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ith their focused portfolio of products and services, these Non Banking Financial I The popularity of these banks can be gauged by the fact that in a short span of time, these banks have gained considerable customer confidence and consequently have shown impressive growth rates. Today, the private banks corner almost four per cent share of the total share of deposits. Most of the banks in this category are concentrated in the high-growth urban areas in metros (that account for approximately 70% of the total banking business with efficiency being the major focus,ay now & pay later in parts!




Dial-A-Draft:
One can use your bank card to pay for your personal expense at places where credit cardas are not acceptable yet. Like paying for investments, telephone & electricity bills, school fees & much more. Just call to your bank phone & the draft you need, will be delivered to you!

Credit limit increase:
Just call & ask for a credit limit increase in the event that you have to make a large purchase on your card urgently. It is especially handy for paying off vehicles repairs, telephone bills & electricity bills, And for anniversaries, weddings, birthdays, or business trips or when a holiday goes beyond budget.




24 Hours ATMs:
One can withdraw emergency cash up to 60% of your credit limit from 24 hours ATMs in Ahmedabad, Bangalore, Calcutta, Chennai, Delhi, Hyderabad, Mumbai & Pune. While traveling overseas you can draw cash from MasterCard ATMs spread across the globe. The same is applicable for any bank branch. What is more the cash withdraw is ensured against theft for a period of 12 hours after withdrawal. A never before facility brought to you with the Bank card. At a transaction fee of 2.5% or Rs. 50 whichever is higher. All cash advances also carry a service charge from the date of the transaction fee of 2.5 % or Rs. 50 whichever is higher. All cash advances also carry a service charge from the date of the transaction. The cash withdrawal limit for the first year is Rs. 5,000.

Photo card:
One may choose to have your photograph & signature digitally imprinted on the front of your card in color. So that you get the extra recognition & security you expect as a Bank card member.

Concession on Personal Remittance:
Do you often need to remit funds to other cities using facilities such as Drafts/ Telegraphic transfers, etc.? Here’s a benefit you would most appreciate. A 25% rebate on standard commission is offered on personal remittance bank branches.

Overdraft Facility:
Your bank card provides you with an overdraft facility to the extent of 75% of the value of your holding of Demat shares & units! Moreover, you get the waiver of 0.5% on interest rate chargeable under scheme. All you need to avail yourself of these benefit is a Demat A/c with every bank.


Free ATM card:
The bank offers you a free ATM card, which can be used at Bank ATM centers allover India. All you have to do is open a saving bank/ current account with such bank.

Other Features:
The bank card has the widest possible reach – welcome by 1,10,000 Merchant partners across India & Nepal & yet another 160lakh merchant Establishment worldwide. Spend in a foreign currency & pay in Indian rupees. The card can be used for both major occasions, & also for everyday purchase like groceries, cosmetics & petrol & auto accessories. To buy high value items like consumer durable (refrigerators, washing machines, microwave ovens, etc.) And even paying customs duty & hospitals bills become so convenient with your cards.

Product Width & Depth:

Width:
Width of the product mix is no. Of product lines a company is offering. The product width could be a narrow one or a wide one depending from bank to bank. A wide mix encourages more sales since the bank is able to diversify & provide more to the customers & they also appeal to a larger target market.

Depth:
Depth of the product mix is the number of product items in each product line. Banks with more schemes & service have more depths than those offering only a few.

Here is table given an example of a bank width & depth in a product mix.

WIDTH



Thus similarly different bank plan out their product portfolios & bases on that the depth & width of their product mix can be determined.

In today’s scenario when there is so much competition & there are new foreign banks entering the Indian market it has became more or less like a law to have very wide product lines with more & more number of products in each line.


Product Levels:

Core Benefits:
It is the main or core reason why the customer will buy the service of the bank. More like the basic purpose or necessity.



Basic Product:
The core benefit is converted into a basic product. That is the service that can use by the customer in order to fulfill his / her needs.

Expected Product:
It refers to the set of attributes & conditions expect by the customers when they purchase the service.

Augmented Product:
It is the additional features that the bank provides which exceeds the customer’s expectations.

Potential Product:
Innovations & product differentiation is the bases of a potential product. If the bank alters its services according to the requirements of the individual customers it reaches this level.

Thus, it can be seen in the chart how that how particular product passes through different levels. In today’s competitive scenario most bank try offerings services at augmented & potential level. In below chart: -


The Price Mix

The price mix in the banking sector is nothing but the interest rates charged by the different banks. In today’s competitive scenario where the customer is the king the banks have to charge them interest at the rate in force on accordance with the RBI directives.

Banks also compete in terms of annual fees for services lie credit cards, DMAT etc. another important part of the banks pricing policy today is the interest charged on the Home Loans and Car Loans but at a very competitive interest rate.

Let’s understand this with an example: - A particular buyer approaches for a car loan say for a period of 3 years. He is charged Rs.20000 as interest. However if sales representative of another bank come to know of this deal he will try to attract the customer by giving him a better deal that is loan at a lower rate of interest. In this way due to the high level of competition the customer benefits.


Transaction:

Pricing Strategy:

This model shows a pricing strategy, which should be adopted in order to ensure maximum satisfaction to both the bank as well as the customers.

The price should be set in such a manner that the customer is assured that he is not being cheated or overcharged by the bank and at the same time the bank is able to reap maximum profits. Such a pricing stand help the bank get maximum sales as well as profits since the customer feels that by entering such a transaction he is winning.


The Place Mix

Place mix is the location analysis for bank branches. There are number of factors affecting the determination of the location of the branch of a bank. It is very necessary for a bank to be situated at a location where most of its target population is located.

Some of the important factors affecting the location analysis of a bank are:

The Trade Area:

The trade area is a very important factor determining the place where a bank branch should be set up. For example a particular location may be a huge trading place for textiles, diamonds or for that case even the stock market. Such location is ideal for setting up of bank branches.

Population Characteristics:

The demography of a place is very important factor. This includes:
The income level of the population
The age level
The average male female population
The caste, religion, culture and customs
The average spending and saving habit of the people.
These factors are very important for a bank as it may help to know the kind of business the branch will get.

Commercial Structure:

The commercial structure refers to the level of commercial i.e. business activities taking place at a particular location. The higher the level of business activities taking place in a particular location the more preferable it is for setting up a bank branch.
Industrial Structure:

This is nothing but a combination of the trade area analysis and the commercial structure. However the industrial structure focuses more on thekind of industries operating in a particular location. For example an area like SEEPZ is marked with a lot of electronic manufacturing units. Thus the industrial structure determines the kind of financial transaction that could take place in a particular location.

Banking Structure:

The banking Structure refers to the existence of other banks in the area. Whether there is already an efficient network of other bank branches operating at that particular area. Thus the overall infrastructure needed for the working of a bank.

Proximity of other convenient outlets:

This refers to the other branches of the same bank as well other commercial, entertainment and industrial outlets.

Real Estate Rates:

This is mainly dealing with the cost factor involved in opening up a bank branch at a particular location. The real estate rate is very strong factor influencing the location decision for a bank branch.

Proximity to public transportation:

The location should be proximate to public transportation facilities. This means it should have bus stops close by as well as it should be proximate to railway stations so to make it convenient for the common man.

Drawing Time:

Drawing time refers to the time period in which a bank can draw a huge amount either from other banks or from the RBI in case of any kind of emergency requirement. No bank has more than a certain amount with them and in case a customer wants to withdraw an amount more than that available with the bank, the bank needs to draw that amount from other banks.
Hence a location must be such that it facilitates minimum drawing time.

Location of Competition:

The existence of other banks also means competition. If the level of competition is very high in a particular location it is necessary that a bank do a lot of market research before opening a branch so as to estimate the kind of business it would get.

Visibility:

The location of a branch should be such that it is visible and easily noticed by the customers as well as the other people.

Access:

The bank branch should be very easily accessible to the customers. If this is not the case the customer might switch to some other bank, which is more convenient to him and very easily accessible. The location should be such that it is very convenient for the customers to reach.

The Promotion Mix

Promotion is nothing but making the customers more and more aware of the services and benefits provided by the bank. The banks today can use a lot of new technology to communicate to their customers. Two of the fastest growing modern tools of communicating with the customers are:

1. Internet Banking
2. Mobile Banking

Let’s understand this with an example of services provided by banks to promote its modern services.

SMS functions through simple text message sent from cellular phone. These messages are recognized by bank to provide you with the required information.

ICICI was the first organization in India to provide Wireless Application Protocol (WAP) based services. Mobile commerce using WAP technology, allow secure online access of the web using mobile devices. With WAP one can directly access the ICICI WAP server, check one’s account details and use other value added services.

What is ICICI Bank Internet Banking?
ICICI Bank Internet Banking is convenient banking! Almost all the banking transactions for which you need to visit the branch can be done on their Internet banking site.






From checking your account balance to transaction history to transferring funds to paying bills, you can do everything here. Its convenience banking – anytime, anywhere! To avail of this convenience, you have to get registered.

You can make the following requests online:
Apply for a Credit Card
Apply for a Debit Card
Order a new cheque book
Stop cheque request
Cheque status inquiry
Intimation for loss of ATM Card
Open Fixed Deposit
Open a Recurring Deposit
Apply for a Value Added Savings Account
Apply for Phone Banking

Given below is a small list of transactions that you can do online:
Banking
Balance enquiry
Transaction history
Use Bank Funds Transfer (eCheques) to:
Transfer funds between your own Bank A/cs
Transfer funds to any Bank a/c
Transfer funds to any non Bank a/c (in 15 cities)
Make Service requests like open a Fixed Deposit, duplicate pin etc.
Credit card
View current and past statement
Service requests like auto debit, dial a draft etc.
Demat
View your transaction and holding statement
Bill Payment
Use your Bank Account or Credit Card to pay your bills from the comfort of your home.

Thus different banks to promote its services use different methods.

A bank may have very attractive schemes and services to offer to their customers but they are of no use if they are not communicated properly to the customers. Promotion is to inform and remind the individuals and persuades them to accept, recommend or use of product, service or idea. However there are some very important points that are to be considered before the promotion strategy is made. These points are:

Finalizing the Budget:

Before the bank decides the kind of promotion that should be done it is very important to finalize the budget for it. The formulation of a sound budget is essential to remove the financial constraints in the process. The budget is determined on the volume of business of the bank. In addition to this intensity of competition also plays a decisive role.

Selecting a suitable vehicle:

Another very important task is to select a suitable vehicle for driving the message. There are a number of devices to advertise such as broadcast media, telecast media and the print media. The selecting of the mode of advertising is strongly influenced by the kind of budget decided. Usually for promoting banks the most effective and economical form of advertising has been the print media.

Making possible creativity:

Making possible creativity is nothing but the kind slogans, punch lines etc. that are supporting the message. They should be very creative but yet simple to be understood by the common man. It should appeal to the customers. It should be distinct from that of the competitors and should be successful in informing and sensing the customers.

Testing the Effectiveness:

It should be bear in mind that the advertisement is first tested for its effectiveness. This should be done with the help of various techniques like testing effectiveness on a sample group. This helps determine the success of the advertisement and in case of any problem the advertisement can be altered and remade.

Instrumentality of Branch Managers:

At a micro level it is the responsibility of the branch managers to promote and drive the message to the people in the local area. They should organize small programs in order to attract people and create awareness in the local area about the new schemes of the bank.


Different Ways of Promotion:

Public Relations:

In today’s competitive scenario developing strong public relations is very important for any bank to be successful. Most banks today have a separate Public Relations department. However primarily it is considered as a responsibility of the various bank managers to develop a steady and strong relationship with their present customers as well as potential customers. This can be done by a constant follow- up and also some small programmers etc.

Personal Selling:

Personal selling is found to be one of the most effective and popular form of promoting bank business. The main reasons for this are that banking is a service in which trust plays a very important role. In personal selling a bank representative goes to the customers and explains the scheme to the customers. Also he gives the customers any kind consultation he might need. He provides the customers all the information seeked by him. Representative tries to persuade the customers to go for the scheme provided by the bank by telling him all the benefits. Here are some of the important features of personal selling.

It is a direct relation between the buyers and seller
It is oral presentation in conversation
It is personal and social behavior
It is found to be more effective in service oriented organizations.
It is based on the professional excellence or expertise of an individual.

Sales Promotion:

Sales promotions are basically giving the customers some additional benefits maybe at times just some small gifts in order to promote the schemes. The more innovative the sales promotions the more positive are the results. Some of the most popular sales promotions techniques are gifts, contests, fairs and shows, discounts and commission, entertainment and traveling plans for bankers, additional allowances, low interest financing etc. it is very important that the sales promotion benefits are designed in such a manner that they are better than those of the competitors.

Word – of – Mouth Promotion:

This form of promotions is not only very effective in banking services but in any kind of service. However it is more important in banking for the only reason that this is a service where trust plays a very important role. If one’s friends, relatives, or other well recommends a particular bank’s services – wishers the person is more influences and inclined towards that bank. It is very important to note that the internal employees of the bank play a very important role in word –of – mouth promotion technique. This is because they can start the process by recommending the bank to their friends and relatives and after that it is like chain which spreads like wild fire.



Telemarketing:

In recent times telemarketing has gained increasing importance as an effective tool for promotion. This telemarketing is a process of making use of sophisticated communication network for promoting the banks. This includes promoting through television, telephone, radio and nowadays largely through cell phones. This is most popular form of promotion. Banks today have started using ‘SMS’ and many other services supported by cell phones to provide benefits to their customers and thus have tried to increase their sales. In today’s competitive and modern scenario it very important that banks makes use of telemarketing techniques very efficiently to have desirable results.

Internet:

The use of internet as a promotion tool is increasing very fast today. More and more banks are using internet to promote their services. The online banking has made it even easier for the customers to avail the bank’s services. No longer do people have to go to their bank branches for small petty matters like checking their balance etc. all this can be done with the help of a few clicks.



The People Mix

People are the employees that are the service providers. In a banking sector the service provider plays a very important and determinant role in rendering the customers a satisfactory and a good service. It is extremely essential that the service provider understand what his customers expect from him. In a banking sector the customer needs to be guided in a lot of matters, which is possible only with the help of the service provider.

The position in the eyes of the customer will be perceived by appearance, attitude and behavior of the customer contact employees. Not only has the customers contact employee influenced the customer base of the organization done so.

ICICI Bank, India's second largest bank, with total assets of about Rs.112, 024 crore, wanted to provide an enriched customer experience that would encourage loyalty among existing users and help it gain new business. ICICI, by training their employees, delight their customers.





The Process Mix

The process mix constitutes the overall procedure involved in using the services offered by the bank. It is very necessary that the process is very customer friendly. In other words a process should be such that the customer is easily able to understand and easy to follow. Today if particular banks formalities are long and the procedure very complicated the overall process fails and the customer may not inclined towards using that banks services.

Let’s take for example the process for application for a car loan.
Now this mainly involves 3 things.

1. Producing of proper documents
2. Filling up of application form
3. Paying for the initial down payment




Here the process may fail in the following cases:

If the customer is asked to produce a number of forms out of which some may not be necessary at all. Thus it is very necessary that the customer be asked for minimum but most necessary document and not other unnecessary documents.

In case of application form, the application form must in a language best understood by the customers and it should not be very lengthy one demanding a lot on unnecessary information.


Finally the payment of initial amount. The customer should be given options as to how he would like to pay by cheques or by credit card. Once again the amount should be very competitive not very high above the regular rates prevailing in the markets.

The smaller and simpler the procedures the better the process and the customer will be more satisfied.


The 4I’s of Bank Marketing

There are four distinctive characteristics of service, which create challenges and opportunities. They are commonly known as the four I’s namely:

1. Intangibility
2. Inconsistency
3. Inseparability
4. Inventory

Let’s have a look at each one of them in detail

1. Intangibility

It is that characteristics of a service indicating that it is not a physical attribute, which a person may feel, hear, taste before they buy it.

For example if a person wants to open an account in a bank and wants to have transactions through a particular bank then he/she is not able to decide unless and until he/she experiences the banking services all by himself/herself. This is because the core service of a bank is maintaining and carrying out the money transactions of a person. Thus it becomes very important for a person to experience the core service in order to make a perception about a particular bank.

2. Inconsistency

This refers to variability that a company or an organization may depend on Inconsistency. For a bank, a new customer or a rare going customer may not get the same type of service as much as a regular customer may get. This may be case because the staff members know the person well as he comes often but they don’t know that person does not come in again and again.

Also another point for inconsistency is that different types of people deliver the service delivery by different people that is service differently. Like in case of a bank, different staff members would provide different services. In the bank a person may have a lot of work and may not attend a customer as may be a person with the same work may attend him with great enthusiasm.

I heard this statement that “Punjab National Bank” promotes itself as “crown of quality for customers who is the king” and is an ISO 9002 certified bank. Thus it has to have consistency and quality to serve its customers.

3. Inseparability

Inseparability is that characteristics of a product that cannot be separated from creator-seller of the products. This means that whenever a product is sold a service is also attached with it. Like for e.g. If you buy a room in a hotel to stay for 2 days then the receptionist, the waiters all have their service attached with it. But this only possible when the hotels have customers to stay in and the hotel owner has managers, waiters etc. to provide them services. Thus, services when provided should have both the accepter as well as the seller. This is known as inseparable.


There are basically 3 types of services

Co- production: Where the service provider and the customer work together to produce services. Bank service where if a customer wants to withdraw cash then both need to be present.

Isolated production: The part of the service that is done outside to an organization.

Self-service production: Uses the equipments of the service provider and self-server it. Services of an ATM.


4. Inventory

By this it means that the perishable characteristics of the service marketing. In a bank if a customer starts with his day in the morning eight and ending in the day at four where as in bank is open in morning at 9:00 am and closes at 1:00 pm in the afternoon, then one might not be able to attend it but nothing can be done in this case because for such a person the bank cannot be on tall end. Also there may be less work in the middle of the month whereas in end and starting of the month there could be more work like people come in put money as they get their salary, there would be withdrawals, pass book checking etc. which cannot be transferred in the between of the month as it depend on the people when they come as well one would come to put his money of salary only when he gets it and that’s the end of month. So service faces a lot of problems from inventory and cannot be stored, saved and then used later.










Rater Analysis in Banking Service

Quality means improving customer satisfaction by creating better service processes and outcomes. It means providing better value and maintaining a long-term relationship with the customers.

There are many reasons why a customer should be given a Quality Service. Few of them are listed as follows:

1. As the competition in service sector is increasing day by day, marketers have realized the importance of the customer. They know that if a single customer is lost, then it is very difficult to win him back. Hence, they attempt to provide quality service to their customers better than their competitors.

2. Companies have realized that the cost of making new customers is more than the cost of retaining them. Hence they want to be right at the first time and do not want to lose any customer.

3. The lost customers may spread bad word of mouth about the company. This will create a bad image for the company.

Quality of a service can be improved with the help of ten dimensions of quality. These dimensions are summarized into a RATER model since many of them were over lapping. These five quality dimensions are:





RATER MODEL


1. R – Reliability

2. A – Assurance

3. T – Tangibility

4. E – Empathy

5. R - Responsiveness.



This model is explained as follows with the example of SBI & ICICI.

1. Reliability:

Reliability is the ability to perform the promised service dependably and accurately. Here the organization does what it is suppose to do. They do it right the first time. It also called as “no excuse” service delivery.
The SBI tries its level best to provide reliable service to their customers. They made every attempt to keep their promise and provide a better service different than its competitors. For being more reliable the bank has come up with following services that enables their customer more comfort.

7 Days Banking:
SBI provides seven days banking so that to reduce any inconvenience from bank toward the customers.
SBI has been successful in creating a brand name. It is known for fast and best service. Customers have the perception that they will not be cheated and feel secured. This is the reason why SBI is financially one of the largest banks in India.

Home banking:
Bank has introduced home banking facility for their customers, whereby they can withdraw or deposit any amount simply by operating from their homes. Here customer needs to place their order of payment or deposit in call center on the assigned number of bank. This lead to more safe service for both the parties in this transaction. This service really differentiates this bank from those of other financial institute.
Thus we can say that SBI realize that satisfied customer is one who keep returning to them, thus they have provided them with an reliable service. And customers are also very much satisfied that they believe shopping or using the services of same people over a year. Thus they are also sure about banks reliability & this is what that bank builds from their reliability.

2. Assurance:

Assurance deals with knowledge and accuracy of the employees & their ability to convey trust & confidence. This dimension is of great significance where customer perceives high risk & is not sure of outcomes. In case of banking sector, the risk involved is high. Thus when a person approach’s to the bank in all this circumstances then its banks responsibility to make him assured that he would be completely comfortable & profitable in this deal.
In the advertisement of ICICI bank features a young employee with good personality speaking three words through his gesture i.e. “Hum Hay Naa” -We are always there to help you. This advertisement strategy creates a kind of assurance in the minds of people that ICICI is always there to help them in their financial matters.

Thus the knowledge genuineness, honest & ability to provide the service of front office staff creates trust in the minds of customer. Bank also trained its employees who have high customer contact that can build trust & confidence between employee& customer.

3. Tangibility:

Tangibility is the appearance of physical facilities, equipment, personnel & communication material. The customer actually evaluates the quality of service by above tangible things. Tangibility refers to those items that a person can touch or see. In short how a customer chooses a service? Often customer evaluates the services on the tangible clues or physical evidence, before experiencing it.

ICICI Bank is fully equipped with decent interior. It has all the latest technical instruments such as printer, scanner, fax machines, computers, etc. All the equipments are well maintained to avoid any blockage in the service. There were signboards indicating which department lies where, different counter number etc.

All the employees were in their formal uniforms, which gave a decent look and differentiated them from the customers. All this facility probably helps new customer to reduce his confusion for banking transaction & importantly they get involved in banking environment quickly.




4. Empathy:

Empathy is the ability to provide caring individualized attention that bank provides to its customers. It also means treating the customer as an individual. For bank each customer is unique & they provide them with an personalize attention. Here bank makes efforts to know their customer fully & make them fill that they are important for bank.

The employees of SBI are very polite, humble and helpful. They treat their customers as if they are some one special. All the employees were trained to behave in this kind of attitude. This politeness has helped them to retain their customers with Bank.

In today’s competitive world, banks need to understand what their customer expects from them. At the same time, the company should be able to delight its customers to differentiate their service. For this it is necessary to anticipate their needs, to solve problems before they start and to provide service that wows. To deliver that kind of service, bank needs to hire the right people and train them. Employees should understand what delights their customers. At the same time, it's important for employees to use their own personality and their own ideas - to make the customers happy. They have to know that banking service is a relationship with the customers, and not a transaction.

5. Responsiveness:

Responsiveness is the willingness to help the customers & provide prompt services. The bank should be responsive to their customers in handling complaints and requests.
The customer relates responsiveness to the length of time taken to wait for assistance and to answer the queries & handling the problems.
A successful bank should consider following points to set up speed for their service delivery:
All the staff members have been instructed to be present in the counter fifteen minutes before the commencement of business hours.

Almost all the branches have been provided with a 'May I Help You' counter, whose services can be used by the citizens to complete their transactions in a speedy manner.

Instructions have been issued to the branches to accept local clearing and outstation cheques even after the business hours, till one hour before the closure of working hours of the branch.

Different time limits have been prescribed for specific transactions like encashment of cheques, issuance of demand drafts, deposit of cash, etc.

Teller counters have been functioning in most of ICICI branches for speedy encashment of cheques/withdrawals and also acceptance of cash remittances up to a sum of Rs. 1,000/-.

Staff Committees have been formed in all the branches that look after the improvement of the customer service, maintenance and cleanliness of the branch.

Regional Managers and officials of the Regional Office also visit the branches once in a quarter and guide the branch staff to help serve our customers better.


Blue Printing in Banking Service

A service blueprint is a visual portrayal of a service plan. It is a key tool in service designing. It is a detailed flow chart of different stages in the process. It displays the service by depicting the process of service delivery, points of customer contact, the roles of customers and employees. Blueprints are useful in designing and redesigning the service process.

A key characteristic of service blueprinting is that it distinguishes between what the customers experience “front-stage” and the activities of employees and support processes “backstage”, where customers can’t see them. The line, which distinguishes front stage from back stage, is known as ‘Line of Visibility’.

Service blueprints clarify the interactions between customers and employees and support it from backstage activities. In the blue print, ‘Line of Interaction’ provides the service encounter of customers with the front line staff. The interaction, which supports the service from backstage, is called ‘Line of Internal Interaction’. This line divides the front line staff employees and the operational support staff.

In banks, the blueprint comprises a long-term development strategy and a sector development plan. The long-term strategy is based on key lessons drawn from the experiences of financial sector development and reform in other countries, and it guides the sector development plan.

In banking service, the Blue print:
Sets out a long-term vision and development strategy for the financial sectors.
Aims to develop a sound market-based financial system to support sustainable economic growth
Anticipates that the financial sector whether it will double in terms of the ratio.
To understand the role blueprint in banking service, let us see the two examples of opening an account in ICICI Bank and State Bank of India.


Blueprint of ICICI Bank:

ICICI Bank prepares a ‘blueprint' to lay out its strategy for consolidating its operations and increasing its customer base. Their blueprints have a ‘focus objective' of adding more clients and increasing the branch network, besides introducing new products and value-added services in the coming years.

The process of opening an account in ICICI Bank is given as follows:

Firstly, the customer has to collect the form from the counter.
He has to fill in the details such as name, address, and type of account, name of nominee and so on.
He has to attach certain documents to give a proof for his identity and residential address. These documents include Passport copy, Ration card copy, Telephone bill, etc and his photograph.
Along with the documents, he is required to give a self signed cheque of Rs.5, 100/-
The attached form is then submitted at the counter. Here the form is physically checked.
After checking the form, the information is feed in the computer. The account number and ATM pin card is given to the customer on the spot. But his account activates only after three days.
The branch then sends the attached form to the Regional Processing Center (RPC), where the documents are physically checked and scrutinized.
After the verification is complete, and if they are satisfied with the documents, they activate the account else the form the application is rejected. The control of activating the account is under only RPC. The branch cannot do this activity.
RPC informs the respected branch about the activation of the account.
Finally, the branch employee gives a call to the customer informing him that his account is activated.

Blueprint of State Bank Of India:

This bank prepares blueprint as it helps them to find out the faults in their service and take proactive measures to rectify the same. They use this technique to provide a better quality service to their customers.

The process of opening an account at State Bank Of India is as follows:

The account officer regarding the type of account consults the customer. He explains the complete procedure of opening an account.
The customer has to first attest the photocopies of the documents. At this stage, the originals are verified and the officer stamps the Xerox copies.
Then the three processes remain the same i.e. collection of form, fill the form and submit it with the documents.
In this bank the minimum amount to open account is Rs. 500/-
The officer collecting the form thoroughly and feeds the information in the computer.
The form is again counter checked by the Manager. If all the information is correct then he approves the form by signing it.
With the approval, the account is activated on the spot. All the details regarding the account are provided to the customer.
The last stage in this process is that the bank sends a call letter thanking the customer. The main purpose of this letter is to verify the address of the customer. If the address is not confirmed, a Payorder is released and the account is closed.

Thus by comparing the procedures of both the banks it can be seen that the process of ICICI Bank is longer and takes three days to activate an account. Whereas, it is simpler in SBI, and the account is also activated on the spot.

At the same time, the minimum amount to open an account also differs. In ICICI Bank it is Rs.5100/- and in SBI it is Rs.2, 500/-. This is so because ICICI aims the upper middle class and the rich class as their customers. Whereas, SBI targets the all class of people like lower, middle and upper class people as their customers.



















Fish Bone Analysis















The fish bone analysis is the cause- effect analysis of the service failure. There are eight main aspects that lead to delay in service delivery or service failure.

They are as follows:

Customers:

They are important in services sector because they are directly involved in the process of service making and service delivery. So any delay on the part of the customers may lead to the eventual delay in service delivery.




Facilities & equipments:

Facilities and equipments play an important role when it comes to service delay or service failure. This is because if the arises a problem in the facilities provided or the equipments used then that will lead to delay in service delivery.
In case of the banking sector facilities like ATMs, online banking etc and equipments like computers, printers, money counting machines etc play an important role. If there is a breakdown in any of these equipments or there is some basic formulation problem with the facilities provided then it may lead to delay in service delivery.

Material Supply:

Materials and supplies are also playing an important role during the delivery of the service because they act as the supportive goods for the services provided by the service provider.
In the banking sector materials like pass book, chequebook etc play an important role in service delivery. For example if the cheque book is received by the account holder before he/she uses the last cheque it will lead to enhancement of the service experience but a delay in the issue of the cheque book may lead to service failure.

Front stage personal:

Again a very important aspect with regards to service delivery because it the frontline personnel who come in direct contact of the customers. Any misbehavior on their part or lack of knowledge may lead to service failure or at least delay in service delivery.
In case of a bank a person at the information desk, at the passbook update desk etc are the people that come under this category. As a result of this they have to be well informed about the various policies, procedures as well as the various services provided by the bank and that they must be well behaved. Lack of any of these aspects may lead to service failure.

Back stage personal:

They are the people who support the front line staff and thus play an important role in the process of service delivery.
In the banking sector the backline staff includes the people who are involved with providing loans, accepting deposits, maintaining accounts of the customers etc. if these people are not efficient in their work then it will affect the efficiency of the frontline staff which will in turn lead to delay in service delivery.

Procedures:

Procedures play an equally important role in service delivery. The shorter the process, the faster the service delivery and vice versa.
In most of the banks the procedures are very lengthy which leads to delay in service delivery.

Information:

Proper giving of information is also important or else it may lead to service failure.



Other causes:
There may be other reasons apart from this, which may lead to delay in service delivery or service failure.
FLOWER OF SERVICE
The Case Study
Ashok was a regular customer of Bank of India Borivali branch. He had to make a Demand Draft of Rs.5000/- for the admission process in the college. He was supposed to reach Andheri before 12 noon to submit the DD. Therefore; he reached the bank sharp at 8:30 because he knew that it would take time, as it was a nationalized bank.
On entering the bank Ashok noticed that there was too much crowd. The customers were waiting in a queue and the staff was roaming around which made the place further crowded. He inquired about the procedure for making a DD at the inquiry counter. The officer at the counter was polite and friendly, and guided him. Ashok collected the form from Counter 2, filled in all details and went to submit it on Counter 3. It was 9:00 a.m. when he was standing in the queue. His number came after 20 minutes. When he went to submit the form, with smiles he was told he had to submit an additional form along with it. Ashok was shocked to hear that. He quickly collected the other form and filled the details and again stood for submission. By the time he reached the counter it was 9:45. The person operating at the counter was so slow that it took him 10 min to feed the information in the computer. At 10 he was told that he would be called to collect the DD. Ashok took a sigh of relief and sat patiently.
He waited till 10:30 and went to inquire. The employee said their printer is not working. He was shocked to see that the whole staff was sharing only one printer. He explained his problem to the Manager and made a request to issue the DD as soon as possible. At 11a.m., the Manager handed over a handwritten DD. Ashok rushed quickly and was worried whether he will reach college before 12 or not. He decided to close his account in this bank.
Questions:
1) Which is the deformed pattern of flower of service in this case?
2) List the encounters and the critical encounters?

Flower of Service
It is very important for a firm to provide a variety of service related activities along with the core product. Of the potentially dozens of supplementary services, almost all of them can be classified into one of the following eight clusters. They are classified into two types: facilitating services and enhancing services. They are listed as follows:
FACILITATING SERVICES
Information
Order Taking
Billing
Payment
ENHANCING SERVICES
Consultation
Hospitality
Safekeeping
Exceptions
These eight clusters are displayed as petals surrounding the center of a flower, which is known as ‘Flower of Service.’










In a well-designed and well-managed service organization, the petals and core are fresh and well formed. A badly designed service is like a flower with missing petals. Even if the core is perfect, the overall impression of the flower is unattractive.
All eight supplementary clusters do not surround every core product. It depends upon the type of service. Also the size of the petals varies in different organizations. All the eight clusters are explained below with the example of ICICI Bank:
Information:
Organizations like banks need to provide complete information to the customer as well as the employees. Many a time’s new customers and the existing customers need a direction to the process of service. The bank officers have all the information regarding the banking service.
In the case of Ashok, it can be seen that there was lack of information amongst the employees. The information officer asked him to fill only one form when two forms were required. Thus the employees could not provide suitable direction to the customer. Companies should also take into consideration the time of the process. They should make the customer waited for a long time.
Consultation:
Consultation involves finding out customer’s requirements and develop solution. Customers often seek for consultation in the type of account to be opened. Bank consulters need to understand each customer’s current situation, before suggesting suitable course of action. At this stage, bank employees should have ample of knowledge about the types of account and different situations in which a particular account is opened.
The consultation petal does not apply in the case of Ashok. He did not require any consultation.
Order Taking:
Order taking refers to accepting applications, orders and reservations. In home banking, bankers take orders of money transaction. They see to it that the order taking is easily accessible to the customers. The front line staff is trained in such a manner so that the process is carried politely, fast and accurately.
This petal is not applicable in Ashok’s case.
Hospitality:
Hospitality deals with nurturing the customers and providing all the facilities and makes them feel that they are special to the organization. Most of the banks ensure that their employees treat their customers as guests.
In Ashok’s case, the employees made him stand in the queue for long time. The bank did not comfort their customers while providing the service to them.
Safekeeping:
Customers often want assistance with their personal possessions, while visiting a service site. Unless certain safekeeping services are provided some may not come at all. Responsible businesses also worry about the safety of their customers. Many Bankers pay close attention to safety and security issues of the customers who are visiting their service facilities. Bank educates its customers about how to protect Passbooks, Chequebooks, ATM cards, etc. from theft. They even provide safety measures to operate the ATM machine to avoid personal injuries.
As Ashok was intending to close the account, this petal is not applicable to the case.
Exceptions:
Exceptions involve supplementary services that fall outside the routine of normal service delivery. Banks anticipates exceptions and develops contingency plans and guidelines in advance. They train their employees so that they don’t appear helpless and surprised when customers ask for special assistance. There are several types of exceptions. Few of them are special request, problem solving, handling complaints and restitution.
A special request was made by Ashok to handover the DD as soon as possible. But his request was not granted immediately. In fact, they delayed it. At the same time the problem of printer was not solved quickly. They made him wait for a long time. The bank should have kept more printers to avoid such incidences. This has created a bad image about the bank in Ashok’s mind.

Billing:
Inaccurate and incomplete billing disappoints the customers. Billing should be done timely because it serves to stimulate faster payment. In case of banking, customers expect their passbooks and other documents to be clear, informative and itemized in ways that make it clear how the total was computed. Now a day every bank has computerized billing facility, which makes the billing process easier and faster.
In Ashok’s case, there was problem in providing DD. The billing process of the bank was too lengthy and tiring.
Payment:
In most cases, a bill requires the customers to take action on payment and such action may be very slow in coming. The best example is bank statements. It details the charges that are already been deducted from the customer’s account. Customers expect ease and convenience in payment, thus bank makes all attempts to make their payment process simple and easy. The other examples of payment in banks would be handling of cash, cheques, tokens, vouchers, coupons, etc.
The payment process is negligible in case of Ashok.





Service Encounters
Service encounter is the moment of truth whereby the customer comes in contact with service. There are three types of encounters:
Remote encounter
Encounter on the telephone
Face-to-face encounter
The first few interactions with the customers are most important. These interactions lead the customer to high satisfaction or high dissatisfaction.
In the case study, Ashok had interactions with the following front line staff:
Inquiry counter officer:
The first encounter of the Ashok in the bank was at the inquiry counter. Here the officer in-charge guides him regarding the process and whom shall he meet. The duty of the officer at inquiry counter is to solve small doubts of the customer.
Clerk at the Counter no. 2:
His next interaction was with the clerk at counter no.2. Ashok collected the form from this counter. The role of the clerk is to issue these requirements to the customers and scroll it after the customer fills them.
Clerk at the Submission Counter:
After filling the form, the next encounter of Ashok is with the clerk at Counter no. 3 (i.e. the submission counter). This incidence was critical as it disappointed Ashok very much. This is because he was informed to fill another form along with the one he had.
Manager:
Lastly, Ashok meets the Manager who in turn gives him a handwritten DD. This incidence was also critical because the manager further delayed. He was highly disappointed to meet him. But in the end he is the one who helps Ashok.
Interaction with the employee making the draft:

The most critical encounter here in this case is Ashok’s interaction with employee who was making the draft for Ashok. As the system was computerized, a printer was used to print the draft. But at the last minute the printer got spoiled and stopped working. This made Ashok very restless.



Pest Analysis

Meaning
PEST analysis is very important that an organization considers its environment before beginning the marketing process. In fact, environmental analysis should be continuous and feed all aspects of planning. The organization's marketing environment is made up from:

1. The internal environment e.g. staff (or internal customers), office technology, wages and finance, etc.
2. The micro-environment e.g. our external customers, agents and distributors, suppliers, our competitors, etc.
3. The macro-environment e.g. Political (and legal) forces, Economic forces, Sociocultural forces, and Technological forces.


These are known as PEST factors.





Political:

Political factors can have a direct impact on the way business operates. Decisions made by government affect our every day lives and can come in the form of policy or legislation. Government and RBI policies affects the banking sector at times looking into the political advantage in a particular party the govt. declares some measures to their benefits like a waver of the short term agricultural loans, to attract the farmers votes. By doing so, the profits of the bank go down. Various banks in the co-operative sector are open and run by politicians. They exploit these banks for their benefits. The government appoints various chairmen’s of the banks.

Economical:

All businesses are affected by economical factors nationally and globally. Interest rate policy and fiscal policy will have to be set accordingly. Whether an economy is in a boom, recession or recovery will also affect consumer confidence and behavior. Banking is as old as authentic history and the modern commercial banking are traceable to the ancient times. The present era in the banking may be taken to have commenced with the establishment of the BANK OF BENGAL, Punjab national bank and so on.

Every year RBI declares its 6 monthly policy and accordingly the various measures and rates are implemented. Also union budget affects the sector to boost the economy by giving certain concessions and facilities. If in the budget savings are encouraged more deposits will attract the banks and they in turn can lend more money to the rural sectors, industrial sectors, therefore booming the economy. If the FDI limits are relaxed then more FDI can be brought in INDIA through banking channels.

Social:

Within society forces such as family, friends, and media affect our attitude, interest and opinions. These forces shape that we are as people and the way we behave and what we ultimately purchase. As society changes, as behaviors change organizations must be able to offer products and services that aim to complement and benefit peoples lifestyle and behavior. Before nationalization of the banks the control of banks were in the hands of the private parties and only big business houses and effluent sections of the society were getting benefits of banking in India. In 1969 govt., nationalized 14 banks. The banks helped the weaker sections of the society and provided need-based finance to all the sectors with flexible and liberal attitude. Now even they provide various types of loans to farmers, working women, professionals and traders. Big companies have to provide personalized baking also.

Technological:

Changes in technology are changing the way business operates. The Internet is having a profound impact on the marketing mix strategy of organizations. Consumers can now shop 24 hours a day comfortably from their homes. The challenge these organization faces is to ensure that they can deliver on their promise. Those businesses, which are slow to react, will fall at the first few hurdles. This technological revolution means a faster exchange of information beneficial for businesses as they can react quickly to changes within their operating environment.

There is renewed interest by many governments to encourage investment in research and development and develop technology that will give their country the competitive edge. The latest development in the technology in computer and telecommunication has encouraged banking from everywhere. The use of ATM and Internet banking are helpful. Voice recorders answer simple queries, currency accounting machines self-service counters are now encouraged. Credit card facility is another example of the cashless society now debit cards are also in. these are called as an electronic purse. Some of the banks have also started home banking through telecommunication facilities and computer technology by using terminals installed at customers home and they can make a balance enquiry, get the statement of accounts, give instructions for fund transfers etc through ECS we can receive the dividends and interest directly to our account avoiding the delay of chance of loosing the post. Banks also have started using the SMS systems and interest as a major tool of promotion giving great utility to the customers.

All these technological changes have forced the bakers to adopt the customer-based approach instead of product-based approach.
















THE STATE BANK STORY

The demand for funds by the SBI is even more acute than even the Corporation Bank since the SBI Act provides for a minimum 55 per cent RBI holding in SBI, and the bank is already close to breaching this threshold. The immediate beneficiary of this move would be Corporation Bank where government equity is down to 66 per cent. The bank would be able to access funds from the market without being hampered by the 51 per cent minimum government holding threshold, which currently limits the ability of banks to expand beyond a certain level. Since a decision on the new threshold has been taken in the case of the nationalised banks, the government is expected to follow suit by moving an ordinance to reduce the RBI stake in the SBI to 33%.

The issue of reducing government stake in the nationalised banks has come about on account of demand from the SBI which had demanded that either RBI as the stakeholder pump in funds for the SBI’s massive expansion plans or permit it to issue shares to the public to raise the necessary funds.

Both the Banking Regulation Act and the SBI Act provide that government shares cannot be divested and since the government has decided that it would no longer support banks through budgetary support, they have no option but to go to the market to meet their fund requirements.
Though there is no special significance attached to the 33 per cent threshold in the Company Law — which recognized only 26 per cent and 74 per cent as two major thresholds for management and ownership control — the government has opted for 33 per cent on the basis of the recommendations of the Narasimham Committee. The committee had felt that this threshold would provide comfort to the employees. The banks, like insurance companies, have strong unions and, hence, a phased reduction in government equity was recommended.

The State would continue to be the single largest shareholder in banks even after its stake had been brought down to 33%.
The government is also proposing to move an ordinance for demerger of four subsidiaries of GIC. The law ministry has already cleared both proposals of the finance ministry. In the case of GIC, the ordinance would amend the GIC Act, 1972, and demerge its four subsidiaries - National Insurance Corp, Oriental Insurance, United Insurance and New India Assurance.

Subsidiary of State Bank of India
State Bank of Bikaner & Jaipur
State Bank of Hyderabad
State Bank of Indore
State Bank of Mysore
State Bank of Saurastra
State Bank of Travancore

The services of SBI Bank
Personal Banking
Gold Banking
NRI Banking
International Banking
Corporate Banking
Small Scale Industries
Small Business Finance
Rural Banking
Government Business
Home Loans


SBI Credit Card

The SBI Credit Card offers a Classic VISA card duly acceptable in India and Nepal. It transfers all the advantages provided by the VISA Card. The present eligibility for applying for the SBI Credit Card is Rs. 75,000 for salaried and Rs. 60,000 p.a. for businessmen (kindly verify the rate with SBI before applying).

SBI Credit Card is acceptable over 1,05,000 merchants in India and Nepal. The SBI Credit Card is accepted to 117 cashpoint locations in 57 cities from Leh to Port Blair. The daily withdrawal limit is Rs. 10,000.

SBI Credit Card comes with an insurance of Rs. 2 lakhs on road and Rs. 4 lakhs by air.

Worldwide network of SBI Bank

SBI Bank India has 52 Foreign Offices in 34 countries. SBI India serves the international needs of its foreign customers, in addition to conducting retail operations. The focus of the offices of SBI is India-related business. Few of the countries where SBI Bank has branches are as under:
Australia
Bahamas
Bahrain
Bangladesh
Belgium
Bhutan
Canada
France
Germany
Hong Kong
Japan
Maldives
Mauritious
Muscat
Nepal
Nigeria
Oman
Russia
Singapore
Sri Lanka
South Africa
UK
USA
SBI Central Office

State Bank of India,
State Bank Bhawan,
8th floor, Madame Cama Road,
Mumbai-400 021,
Telephone No. 22029456 or 22029451,
Fax no. 22885369.







Physical Evidence

Physical Evidence is the overall layout of the place. How the entire bank has been designed. Physical evidence refers to all those factors that help make the process much easier and smoother. For example in case of a bank the physical evidence would be the placement of the customer service executive’s desk, or the location of the place for depositing the Cheques. It is very necessary the place be designed in such a manner so as to ensure maximum convenience to the customer and cause no confusion to him.

The experience of Physical Evidence of an SBI bank branch we visited was has follows

Very well organized

All the departments where put up in such order that a rush in one of the departments would not lead to problems to the other department.

The enquiry counters where placed right in front of the entrance so that the new visitors do not have any problem in locating the counters and the people can be helped as quickly as possible.

The work was being carried out at a very efficient pace.

People who had come to withdraw cash where given token numbers and made to sit in the comfortable sofas & chairs which where lead all around the wall of the bank so that there is enough space for the people to sit.
As we had visited the bank during rush hours we though that there would be lot of rush and we won’t be able to get the best possible information but we where totally wrong in our thinking as the bank manager gave very appropriate time and the fullest possible explanation of the topics.

There is no doubt that SBI is the one of the topmost bank as it shows what great planning has been done in even the smallest of the matters.

The only problem was the ATM counter, which had stopped functioning for about 15 to 20 minutes as the machine had some problems in it.




























CONCLUSION
I was having lot of interest to know detailed information on banking. By completing this project I got a lot of satisfaction. I made the project such a way that none of the point should be missed in explaining banking concept. This project will help me in boosting my carrier.
To complete this project I have taken help of respected professors, friends, books & internet. I am very much thankful to my professors & friends for giving me such support.

If any person in this world want to know about Indian Banking than he/she can easily refer to this project. I have given my best to explain banking concept with the help of public as well as privet sector banks. How different banks are provided services to its customers & what is the motive behind formation of those banks are explained in a broader way.