A report which the student presents after the completion of their internship.

1. SUMMER INTERNSHIP PROJECT REPORT
(June7th
2017 –July 22nd
2017)
On Training Undertaken at
Project Title: “A STUDY OF RETAIL BANKING OPERTIONS”
At HDFC BANK
Submitted in partial fulfillment for the award of degree of
Master of Business Administration
FMS- The IIS University
Submitted by:-
AYUSHI JAIN
Roll No.: 162619
Submitted to:-
Dr. SUCHI SINGHAL
(Assistant Professor)
1

2. ACKNOWLEDGMENT
It is really a matter of pleasure for me to get an opportunity to thank all the persons who contributed
directly or indirectly for the successful completion of the project report, “A STUDY OF RETAIL
BANKING OPERATIONS AT HDFC bank”.
I wish to express my gratitude to the branch manager Mr. VIMLESH MALPANI of HDFC BANK,
SIKAR for giving me an opportunity to be a part of their esteem organization and enhance my
knowledge by granting permission to do a summer training Project. They provided me with their
assistance and support whenever needed, which has been instrumental in completion of this project.
I am thankful to them, for their support and encouragement throughout the tenure of the project.
I would also take this opportunity to thank my institute International School of Informatics and
Management to put theoretical inputs gathered at the institute to practise. I also feel a sense of
gratitude towards my guide Dr. Suchi Singhal who took personal interest in progress of this report.
Thanking You,
AYUSHI JAIN
2

3. EXECUTIVE SUMMARY
Retail banking refers to provision of banking services to individuals and small business where the
financial institutions are dealing with large number of low value transactions. The concept is not
new to banks but is now viewed as an important and attractive market segment that offers
opportunities for growth and profits.
Excess of liquidity, increased dependence of corporate on capital markets, the rising income of
middle class with increase in purchasing power and ability to handle debts, the increasing amount of
NPA’s from corporate portfolio and the growth and future growth potential of the credit card
business has induced banks to shift from wholesale banking to retail banking.
Retail banking has immense opportunities in a growing economy like India. As the growth story gets
unfolded in India, retail banking is going to emerge a major driver. Some of the key policy issues
relevant to the retail-banking sector are: financial inclusion, responsible lending, and access to
finance, long-term savings, financial capability, consumer protection, regulation and financial crime
prevention.
The credit portfolio of banking business is fast changing in India. Retail lending is becoming an
important segment of bank credit. Large credit exposures are linked to bank’s capital. Limits have to
be fixed for single exposure in relation to the capital funds. A paradigm shift from corporate lending
and disintermediation are reasons responsible for resurgence.
3

4. TABLE OF CONTENT
Sl. No. Particulars Page No.
1 Introduction
• What is retail banking?
• Why banks are doing conversion
• Offerings
• Retail banking in 2016
5-9
2 Introduction to the industry
• Introduction to organization
• HDFC Bank
• Business Objective
• Wholesale banking services
• Retail banking services and
products
• CSR Activities
10-19
3 Objectives 20
4 Methodology 21
5 Data interpretations 22-28
6 Findings 29-30
7 Limitations of the Study 31-33
8 Conclusion 34
Appendix:-
• Questionnaire
• Bibliography
35-37
4

5. CHAPTER 1: INTRODUCTION
What is Retail Banking
Retail banking is, however, quite broad in nature - it refers to the dealing of commercial banks with
individual customers, both on liabilities and assets sides of the balance sheet. Fixed, current /
savings accounts on the liabilities side; and mortgages, loans (e.g., personal, housing, auto, and
educational) on the assets side, are the more important of the products offered by banks. Related
ancillary services include credit cards, or depository services. Today's Retail banking sector is
characterized by three basic characteristics:
Multiple products (deposits, credit cards, forex cards, insurance investments and securities);
Multiple channels of distribution (call centre, branch, Internet and kiosk); and Multiple customer
groups (consumer, small business, and corporate).
What is the nature of Retail banking? In a recent book, Retail banking has been described as "hotter
than vindaloo". Considering the fact that vindaloo, the Indian-English innovative curry available in
umpteen numbers of restaurants of London, is indeed very hot and spicy, it seems that Retail
banking is perceived to be the in-thing in today's world of banking. There are various banks
providing the retail services to the consenter all over India namely HDFC Bank, ICICI Bank, SBI,
HSBC Bank, Axis Bank etc.
Why banks are doing conversions?
Banks are awash with liquidity. Prime corporate do not borrow from banks except at sub-PLR rates.
Banks do not favor other corporate. Suddenly there is a great change in attitude of banks. The name
of the game is no longer ‘Lending to big corporate, huge amounts to create loan assets’. Banks
invest their resources in government paper to the hilt and then scout for hitherto neglected retail
borrowers for lending. Retail credit is now welcomed even from RBI’s perspective. There are no
longer any regulatory hurdles. Consumer credit is no longer considered as unproductive, as it
triggers demand for consumer products, which in turn help manufacturers in a period of economic
slowdown. Retail to project credit stands to a ratio of 3: 1. While the rates of interest on consumer
credit have still fallen, there is a scope for further reduction. Perhaps, competition will further bring
down the interest rates.
5

6. Fixed interest rates on housing loan have sharply fallen, but not the floating rates, which are linked
to medium and long-term PLRs. Banks, refuse to reduce these rates, which appears rather unfair. But
then the consumers still needs innovative products like graduated payment mortgages etc., in place
of stand alone EMI structures.
SME sector borrowers still appear to be suffering from inadequate and delayed credit delivery this
sector has immense potential for growth and banks have to devise innovative strategies to fund their
ventures on the principle of entrepreneurship and bank ability rather than mere collateral securities.
Micro finance, another area of retail credit, has unfortunately become a so-called priority sector
credit. Perhaps it will be a great idea if it is delinked from the obnoxious priority tag and thereby
allow banks to display creativity in financing the sector, especially in rural and semi-urban areas
where its potential for positive transformation of socio-economic conditions is immense. Banks are
gradually appreciating the virtue of spreading the credit risk by financing large number of small
(Retail) borrowers.
Credit card business is growing and even government banks have started marketing cards.
Surprisingly, they still do not leverage the network of branches and availability of surplus manpower
into effective marketing. The interest rates on credit cards that are 30 percent per annum refuse to
come down. May be with the active participation of many banks in this lucrative business, the
customer will eventually have the benefit of low rates. Thanks to the on set of ATMs, channel
migration is visible.
The personal banking segment customers have become the center of attraction. It is their deposit and
savings account that are actively sought after, and not mega deposits at a slightly higher rate of
interest. Banks are truly spreading their deposit net rather widely.
It perhaps apt to quote what Hugh McCulloch, secretary of the treasury – UK, said long ago –
‘Distribute your loans rather than concentrate them in a few hands. Large loans to a single borrower
or a firm, although some times proper and necessary, are generally injudicious and frequently
unsafe. Large borrowers are apt to control the bank, and when this is the relation between a bank and
its customers, it is not difficult to decide which one in the end will suffer”.
Offerings
6

7. • Retail Banking solutions and services.
• Credit cards
• Internet Banking.
• Mortgages practice.
• Multi-Channel Integration.
• Business Rule Engine.
• Customer Relationship Management.
• ATM Solutions and services
Key Benefits Associated with Offerings:-
• On-line, real time processing and cost saving thru Multi channel Transactions.
• Relationship banking enabled through extensive mining of all customer
transactions.
• Rapid time-to-market with new product and service offerings.
• Rapid Customer Acquisition. Multi-currency and multi-language support so as to
ensure geographic reach across continents.
• Multi-layer security, monitoring and reporting.
Seamless integration with advanced delivery systems including teller and branch automated teller.
Retail Banking in India 2016
Retail banking in India is not a new phenomenon. It has always been prevalent in India in
various forms. For the last few years it has become synonymous with mainstream banking for
many banks. The typical products offered in the Indian Retail banking segment are housing
loans, consumption loans for purchase of durables, auto loans, credit cards and educational
7

8. loans. The loans are marketed under attractive brand names to differentiate the products offered
by different banks. Credit card is another rapidly growing.
While new generation private sector banks have been able to create a niche in this regard, the
public sector banks have not lagged behind. Leveraging their vast branch network and outreach,
public sector banks have aggressively forayed to garner a larger slice of the retail pie. By
international standards, however, there is still much scope for Retail banking in India. After all,
retail loans constitute less than seven per cent of GDP in India vis-à-vis about 35 per cent for
other Asian economies — South Korea (55 per cent), Taiwan (52 per cent), Malaysia (33 per
cent) and Thailand (18 per cent). As Retail banking in India is still growing from modest base,
there is a likelihood that the growth numbers seem to get somewhat exaggerated. One, thus, has
to exercise caution is interpreting the growth of Retail banking in India.
The annual growth in bank credit to the commercial sector is at 25.4%as on March 31, 2016 and
was lower than 27.2% against previous year. Till 2015, retail banking is expected to grow at a
CAGR of 28% to touch a figure of INR 9,700 billion. This requires expansion and
diversification of retail product portfolio, better penetration and faster service mechanism.
The Retail Banking Industry in India covers industry segments like housing loan, auto loan,
personal loan, education loan, consumer durable loan, credit card etc. Total 22 major retail banks
in India are covered in terms of their performance, strategy and outlook.
Key Highlights Covered
• During 2016-17, gross credit extended by Indian commercial banks grew by 34.83% to touch
INR 19,495 billion.
• Bank increase deposit Rs.57988 crores during the period of 2016 against Rs.45, 384 crores
during the period of 2016 And that is 19.3% from 16.3% Retail credit constitutes about 25%
of the total credit and has grown by 28.0% to INR 4,218.3 billion.
8

9. • The annual growth in bank credit to the commercial sector is at 25.4% as on March 31, 2017
and was lower than 27.2% against previous year.
CHAPTER 2
INTRODUCTION TO THE INDUSTRY
BANKING IN INDIA
Without a sound and effective banking system in India it cannot have a healthy economy. The
banking system of India should not only be hassle free but it should be able to meet new challenges
9

10. posed by the technology and any other external and internal factors. For the past three decades
India's banking system has several outstanding achievements to its credit. The most striking is its
extensive reach. It is no longer confined to only metropolitans or cosmopolitans in India. In fact,
Indian banking system has reached even to the remote corners of the country. This is one of the main
reasons of India's growth process.
HISTORY
The first bank in India, though conservative, was established in 1786. From 1786 till today, the
journey of Indian Banking System can be segregated into three distinct phases. They are as
mentioned below:
· PHASE I - Early phase from 1786 to 1969 of Indian Banks
· PHASE II - Nationalization of Indian Banks and up to 1991
· PHASE III - Indian Financial & Banking Sector Reforms after 1991.
10

11. PHASE I:
The General Bank of India was set up in the year 1786. Next came Bank of Hindustan and Bengal
Bank.
The East India Company established
• Bank of Bengal (1809),
• Bank of Bombay(1840) and
• Bank of Madras (1843) as independent units and called it Presidency Banks.
These three banks were amalgamated in 1920 and Imperial Bank of India was established
which started as private shareholders banks, mostly Europeans shareholders. During the first phase
the growth was very slow and banks also experienced periodic failures between 1913 and 1948.
There were approximately 1100 banks, mostly small. To streamline the functioning and activities of
commercial banks, the Government of India came up with The Banking Companies Act, 1949 which
was later changed to Banking Regulation Act 1949 as per amending Act of 1965 (Act No.23 of
1965). Reserve Bank of India was vested with extensive powers for the supervision of banking in
India as the Central Banking Authority. During those day’s public has lesser confidence in the banks.
As an aftermath deposit mobilization was slow. Abreast of it the savings bank facility provided by
the Postal department was comparatively safer. Moreover, funds were largely given to the traders.
PHASE II:
Government took major steps in this Indian Banking Sector Reform after independence. In 1955, it
nationalized Imperial Bank of India with extensive banking facilities on a large scale especially in
rural and semi-urban areas. Second phase of nationalization Indian Banking Sector Reform was
carried out in 1980 with seven more banks. This step brought 80% of the banking segment in India
under Government ownership.
The following are the steps taken by the Government of India to Regulate Banking Institutions in
the Country:
· 1949: Enactment of Banking Regulation Act.
11

12. · 1955: Nationalization of State Bank of India.
· 1959: Nationalization of SBI subsidiaries.
· 1961: Insurance cover extended to deposits.
· 1969: Nationalization of 14 major banks.
· 1971: Creation of credit guarantee corporation.
· 1975: Creation of regional rural banks.
· 1980: Nationalization of seven banks with deposits over 200 crores.
After the nationalization of banks, the branches of the public sector bank India raised to
approximately 800% in deposits and advances took a huge jump by 11,000%.Banking in the
sunshine of Government ownership gave the public implicit faith and immense confidence about the
sustainability of these institutions.
PHASE III
This phase has introduced many more products and facilities in the banking sector in its reforms
measure. In 1991, under the chairmanship of M Narasimham, a committee was set up by his name
which worked for the liberalization of banking practices.
The country is flooded with foreign banks and their ATM stations. Efforts are being put to give a
satisfactory service to customers. Phone banking and net banking is introduced. The entire system
became more convenient and swift. The financial system of India has shown a great deal of
resilience. It is sheltered from any crisis triggered by any external macroeconomics shock as other
East Asian Countries suffered. This is all due to a flexible exchange rate regime, the Foreign
Reserves are high, the capital account is not yet fully convertible, and banks and their customers
have limited foreign exchange exposure.
12

13. 1.2 NATIONALIZED BANKS IN INDIA
Banking System in India is dominated by nationalized banks. The nationalization of banks in India
took place in 1969 by Mrs. Indira Gandhi the then prime minister. The major objective behind
nationalization was to spread banking infrastructure in rural areas and make available cheap finance
to Indian farmers. Fourteen banks were nationalized in 1969.
Before 1969, State of India (SBI) was only public sector bank in India. SBI was nationalized in 1955
under the SBI Act of 1955. The second phase of nationalization of Indian banks took place in the
year 1980. Seven more banks were nationalized with deposits over 200 crores
1.3 PRIVATE BANKS
All the banks in India were earlier private banks. They were founded in the pre-independence era to
cater to the banking needs of the people. But after nationalization of banks in 1969 public sector
banks came to occupy dominant role in the banking structure. Private sector banking in India
received a fillip in 1994 when Reserve Bank of India encouraged setting up to private banks as part
of its policy of liberalization of the Indian Banking Industry. Housing Development Finance
Corporation Limited (HDFC) was amongst the first to receive an ‘In principle’ approval from the
Reserve Bank of India (RBI) to set up a bank in the private sector.
Private Banks have played a major role in the development of Indian banking industry. They have
made banking more efficient and customer friendly. In the process they have jolted public sector
banks out of complacency and forced them to become more competitive.
13

14. INTRODUCTION TO THE ORGANIZATION
HDFC BANK
TAGLINE:
The Housing Development Finance Corporation Limited (HDFC) was amongst the first to receive
an ‘in principle’ approval from the Reserve Bank of India (RBI) to set up a bank in the private
sector, as part of the RBI’s liberalization of the Indian Banking Industry in 1994. The bank was
incorporated in August 1994 in the name of ‘HDFC Bank Limited’, with its registered office in
Mumbai, India. HDFC Bank commenced operations as a Scheduled Commercial Bank in January
1995.
HDFC is India’s premier housing finance company and enjoys an impeccable track record in India
as well as in international markets. Since its inception in 1977, the Corporation has maintained a
consistent and healthy growth in its operations to remain the market leader in mortgages. Its
outstanding loan portfolio covers well over a million dwelling units. HDFC has developed
significant expertise in retail mortgage loans to different market segments and also has a large
corporate client base for its housing related credit facilities. With its experience in the financial
markets, a strong market reputation, large shareholder base and unique consumer franchise, HDFC
was ideally positioned to promote a bank in the Indian environment.
Capital Structure
The authorize capital of HDFC Bank is Ra.450 crore (Rs.4.5 billion). The paid-up capital is
Rs.311.9 crore (Rs.3.1 billion). The HDFC Group holds 22.1% of the bank’s equity and about 19.4%
of the equity is held by the ADS Depository (in respect of the bank’s American Depository Shares
(ADS) Issue). Roughly 31.3% of the equity is held by Foreign Institutional Investors (FIIs) and the
bank has about 190,000 shareholders. The shares are listed on the ‘The Stock Exchange, Mumbai
and the National Stock Exchange. The bank’s American Depository Shares are listed on the New
York Stock Exchange (NYSE) under the symbol “HDB”.
14

15. Distribution Network
HDFC Bank is headquartered in Mumbai. The Bank at present has an enviable network of over 761
branches spread over 327 cities across India. All branches are linked on an online real-time basis.
Customers in allover 120 locations are also serviced through Telephone Banking.
The Bank also has a network of about over 1977 networked ATMs across these cities. Moreover,
HDFC Bank’s ATM network can be accessed by all domestic and international Visa / MasterCard,
Visa Electron / Maestro, Plus / Cirrus and American Express Credit / Charge cardholders.
Technology
HDFC Bank operates in a highly automated environment in terms of information technology and
communication systems. All the banks branches have online connectivity, which enable the bank to
offer speedy funds transfer facilities to its customers. Multi-branch access is also provided to retail
customers through the branch network and Automated Teller Machines (ATMs).
The bank has made substantial efforts and investments in acquiring the best technology available
internationally, to build the infrastructure for a world class bank. The Bank’s business in supported
by scalable and robust systems which ensure that the bank clients always get the finest services.
The Bank has prioritized its engagement in technology and the internet as one of its key goals and
has already made significant progress in web-enabling its core business. In each of its businesses,
the Bank has succeeded in leveraging its market position, expertise and technology to create a
competitive advantage and build market share.
Businesses
HDFC Bank offers a wide range of commercial and transactional banking services and treasury
products to wholesale and retail customers. The bank has three key business segments are follows.
Wholesale Banking Services
15

16. The Banks target market ranges from large, blue-chip manufacturing companies in the Indian
corporate to small & mid-sized corporate and agri-based business. For these customers, the Bank
provides a wide range of commercial and transactional banking services, including working capital
finance, trade services, transactional services, cash management, etc. the bank is also a leading
provider of structured solutions, which combine cash management services with vendor and
distributor finance for facilitating superior supply chain management for its corporate customers.
Based on its superior product delivery / service levels and strong customer orientation, the Bank has
made significant inroads into the banking consortia of a number of leading Indian corporate
including multinationals, companies from the domestic business houses and prime public sector
companies. It is recognized as a leading provider of cash management and transactional banking
solutions to corporate customers, mutual funds, stock exchange and banks.
Retail Banking Services
The objective of the Retail Bank is to provide its target market customers a full range of financial
products and banking services, giving the customer a one-stop window for all his/her banking
requirements. The products are backed by world-class service and delivered to the customers
through the growing branch network, as well as through alternative delivery channels like ATMs,
Phone Banking, Net-Banking and Mobile Banking.
The HDFC Bank Preferred program for high net worth individuals, the HDFC Bank Plus and the
Investment Advisory Services programs have been designed keeping in mind needs of customers
who seek distinct financial solutions, information and advice on various investment avenues. The
Bank also has a wide array of retail loan products including Auto Loans, Loans against marketable
securities, Personal Loans and Loans for Two-wheelers. It is also a leading provider of Depository
Participant (DP) services for retail customers, providing customers the facility to hold their
investments in electronic form.
HDFC Bank was the first bank in India to launch an International Debit Card in association with
VISA (VISA Electron) and issues the MasterCard Maestro debit card as well. The Bank launched its
credit card business in late 2001. By September 30, 2016, the bank had a total card base (Debit and
credit cards) of 5.2 million cards. The Bank is also one of the leading players in the “merchant
acquiring” business with over 50,000 Point-of –sale (POS) terminals for debit / credit cards
acceptance at merchant establishments.
Retail Banking Products
16

17. Wide range of retail banking products and services are offered by the banks, which cover both
Depository and Advances to suit various segments of customer like salaried persons, businessmen,
traders, professionals, pensioners etc. are as follows:-
• Housing loan.
• Personal loan.
• Vehicle or automobile loan.
• Loan for consumer goods.
• Credit and Debit cards-Global and international.
• Loan for holidays.
• Insurance products.
• Gold loans.
• Event loans.
• Overdraft.
• Mutual funds etc.
• Leasing, hire purchase and factoring services
Retail banking depositories in various segments like children, housewives, salaried class,
professionals etc. include the following: -
• Flexi deposit accounts.
• Savings bank accounts.
• Recurring deposit account.
• Fixed deposit
• Lockers.
• Other short-term deposits.
Banks are coming out with more features to add value to retail banking products and services. These
are called VALUE ADDED PRODUCTS AND SERVICES. These include the following: -
• Free collection of specified number of outstation instruments per month.
17

18. • Instant credit of outstation cheque.
• Concession in commission, exchange for issuance of pay orders and demand drafts.
• Issuance of free cheque books.
• Issuance of free ATM cards.
• Interest rate options (fixed or floating)
• Waiver of credit card issuance fees.
• Free issuance of Add On cards to the members of the cardholders.
• Accident insurance cover.
• Arranging for insurance cover on the lockers in the bank.
• Reducing the fees charged on locker facilities.
• Free execution of standing instructions of customers.
• Free investment advisory services.
• Legal services for documentation
• Services to senior citizens
Other services include
• Payment of utility bills like electricity bills, telephone bills and water bills etc. on due date.
• Payment of monthly or quarterly education fee for children.
• Payment of insurance premium on or before due dates.
• Demating of shares, debentures and bonds.
• Telephone banking.
• Internet banking.
• Making payments at doorsteps
18

19. NRI ACCOUNTS
The present menu of bank accounts for Non-Resident Indians (NRIs) has three categories:
1. Non-Resident (External) Rupee Accounts (NRE)
2. Non-Resident (Ordinary) Rupee Accounts (NRO)
3. Foreign Currency Non-Resident (Banks) Accounts FCNR (B)
CSR Activities
Development in a large country brings with great social responsibilities adding up various
challenges; the foremost is to translate economic growth to sustainable development. To achieve
this, it is critical that growth be inclusive. At the core of this strategy is our commitment to reach out
to marginalized communities through our Sustainable Livelihood Initiatives and to encourage each
business to include social and environmental consideration as part of their business processes.
HDFC Bank has undertaken several interventions and projects through the year to create a positive
impact on society while doing business. These are:
 Sustainable livelihood
 Sanitation
 Education
 Skilling
 Community initiatives
Other key initiatives
 Educational crisis scholarship support (ECSS)
 Fellowship for social change
 Organizing blood donation drive
 Payroll giving through employees
19

20. CHAPTER 3
OBJECTIVES
• To study the customers awareness in respect of Retail banking products and services.
• To know about the customer preferences regarding retail banking services provided by the
bank.
• To know about the customer’s satisfaction for the services that they avail from the bank.
DURATION OF THE PROJECT : 45 DAYS
20

21. Chapter 4
METHODOLOGY AND SAMPLE DESIGN
This unit of observation and analysis of survey of bank customers of HDFC Bank. The sampling
frame in the form of a list of all customers is neither readily available nor can it be easily prepared.
One of the notable features of the design is that the sample has been taken from a cross section of
customers in Sikar with the objective of enhancing the precision of the estimates. Since most of the
policy decisions are been taken by the head office which is located at Mumbai a total of 1000
customers in different branches of HDFC Bank were selected in the Sample frame. Information on
some basic characteristics of the customer along with the service availed from HDFC Bank was
collected from these customers. A sub sample of 50 customers was then used for detailed
canvassing.
Coverage: -
Sikar City and its suburb have been covered by the survey.
Reference Period:
The field operation for the customer pre-tested questionnaire was carried out during June and July,
2017.
21

22. CHAPTER 5
DATAANALYSIS AND INTERPRETATION
Distribution of Sample Customers according to their Monthly income
Monthly Income Group No. of Customers
Unto Rs.10,000 07
Rs.10,001- Rs.25000 22
Rs.25001- Rs.50000 12
Rs.50001- Rs.100000 06
Rs.100001 and above 03
Fig:5.1
It can be seen from the above, that the data collected for sample customers according
to their monthly income. The Customers having a monthly income of Rs.10001 to Rs.25000 was the
maximum i.e. 22 numbers of customers. And the second higher income group is from Rs.25001 to
Rs.50000 i.e 12 numbers of customers. And least income monthly group is from Rs.100001 and
above i.e. 3 numbers of customers.
Distribution of customer on the basic of only availing services out of 50
customers
22

23. Type of Services and Products No of customers
Net Banking 27
Phone Banking 15
E-Payment 07
Insta Alerts 20
Locker 04
ATMs 47
TABLE : 5.2
Figure1.1
It can be seen from the above table and the diagram that maximum number of customers using
ATMs facility that is 47 number of customer utilized the ATMs facility out of 50 numbers of
customers and second higher services utilized by the customers is Net banking that is 27 out of 50
customers. Third facility used by customers is Insta Alerts that is 20 out of 50 customers. Minimum
number of customers using Locker and E-Payment services that is 04 and 07 out of 50 customers.
Since the purpose of the survey is only to estimate the number and level of services availed of by the
customers. The information on the type of the services was also collected and the distribution is us
under.
23

24. Distribution of customer on the basic of type of services availed
Type of Service
Income Level
Below
10000
10001
-25000
25001 –
50000
50001 –
100000
Above
100000
Net Banking 2 10 8 4 3
Phone Banking 2 3 6 3 1
E-Payment - - 2 4 1
Insta Alerts - 8 6 3 3
Locker -- -- -- 1 3
ATMs 4 22 12 6 3
TABLE : 5.2
It can be seen from the above, that the data collected for sample customers according to their
monthly level of income. All kind off services are used by only upper middle and high income
group customers that can seen from the above table. Below Rs.10000 monthly incomes group
customers normally use ATMs, net banking and phone banking services. And Rs.10001 to Rs.25000
monthly income group customers use net banking, phone banking, insta Alerts and ATMs. And
above Rs.25001 to Rs.50000 income group customers use net banking, phone banking, E-payment
and ATMs services. But from the above table Net banking, phone banking and ATMs services are
used all kind of income group customers and the service like locker and E-payment are used only
upper middle and high income group customers. But the maximum type of services availed by the
customer like ATMs, Net Banking and Phone Banking.
24

25. Profession wise Distribution of monthly income
Profession
Less than
10000
Above 10001 –
25000
25001 –
50000
50001 –
100000
Above
100001
Professional -- -- -- 1 1
Business Men -- 2 8 3 2
Salaried Person 2 20 4 2 --
Others 5 -- -- -- --
TABLE: 5.3
It can be seen from the above table that profession wise distribution off monthly income are given in
this salaried persons monthly income distribution are more number i.e. less than 10000/- (2 persons),
above 10001 – 25000/- (20 persons), 25001-50000/- (4 persons) and 50001 – 100000/- (2 persons).
And the second maximum distribution is Businessmen.
Age Wise Distribution of monthly income
Age
Less than
10000
Above 10001
– 25000
25001 –
50000
50001 –
100000
Above
100000
18 – 24 5 4 1
25 – 39 2 15 4 3
40 – 59 -- 2 7 2 2
60 and above -- 1 -- 1 1
TABLE : 5.4
From the above table the age wise distribution of monthly income are given in this the age between
25 – 39 the monthly income group customers are more comparatively other age group. And the
second maximum monthly income age group is 40 – 59. And the least income age group are 60 and
above.
The level of services provided by the Bank
25

26. Level of Services
Number of
customers
Excellent 10
Very Good 9
Good 28
Average 7
Bad 2
TABLE : 5.5
It can be seen from the above table that the level of services provided by the bank. In this table 28 %
of customers say “Good”. And 10% of customers say “Excellent”, 9% of customers say “Very
Good”, 7% of customers say “Average” and 2% of customers say “Bad”.
Ranking of the customers according to the factor are given under
Ranking
Number of customers
Advise
from
Friends
Independently
Existing
Customers
Tele
Marketing
Economic
situation
1 19 23 1 3 4
2 18 18 7 5 2
3 10 5 16 9 10
4 2 2 14 16 16
5 1 2 12 17 18
Figure1.2
From the above table and diagram we can see that the ranking of the customers according to the
factors the first rank is given to “Independently “ factors the decision are taken by the customer
itself rather then he ask other or other factors. The second rank is given to “Advise from Friends”
and “Independently” in this customer takes some advice from friends and relative before take some
services from the bank. The third rank gives to “Existing customers” the customer asks some kind of
26

27. information from exiting customers before take the services from the customers. Fourth rank gives
to”Tele Marketing” and “Economic Situation” in this the customer take some kind of advice from
the tele-marketing executives and customer itself analysis the economic situation regarding their
products and services accordingly the customer take the decision. And the fifth rank is given to
“Economic situation”. The services may be Phone Banking, Net Banking, ATMs, Mobile Banking,
E-Payment, Insta Alerts and Lockers Etc. before use the services from the bank the customer are
rank the services and then he buy the services from the bank.
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28. CHAPTER 6
FINDINGS
• Debit cards have become very popular in India. But, as of date, ATM/Debit cards have still
their primary usage for cash withdrawal from the ATM machines.
• While credit cards are more popular in making payments online. There is a growing
awareness regarding RTGS amongst Indians but still around 73% of the respondents
surveyed have never used RTGS.
• Fund transfer and Online bill payment emerged as the most popular payment options in
internet banking, with over 60% of the respondents using this method.
• Interestingly, many customers have been unable to use internet banking due to the non
availability of site or connectivity problems. Moreover, a trust in the security of internet
banking is yet to develop amongst the majority of bank customers.
• As far as mobile banking is concerned, its popularity is limited mainly due to the charges for
sending SMS's are not justified. Despite the available payment options, how well customers
are able to use them is still a question. The key differentiator in future will be how banks can
increase usage of these payment options by the end user. Competitive analysis of Indian
retail sector vis-à-vis global retail industry.
• Supportive policies and regulations of government for the retail sector.
• Issues and implications related to the current foreign direct investment in the retail sector.
• Market size and growth of Indian retail sector segmented by sectors, retail formats, and
regional segmentations.
• Increasing employment opportunities with stepping up of international retail brands in India.
• Behavioral pattern, preferences and expenditure capacity of Indian consumers.
• Increasing acceptance of e-retailing among Indian consumers.
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29. • Evolution of franchise businesses in Indian retail sector.
• Customers’ preference to more and more alternate channels for convenience.
• Fee based income from remittance is shrinking due to RTGS and other technology
initiatives.
• Rapid penetration of Personal Computers, Mobile phones and on-line Trading and purchase
options encouraged increased usage of technology banking.
• Retail Banking technology is gaining its importance due to the continued demand
• Retail Banking customers are demanding more and more features and product
differentiation.
• More and more Retail customers in the age group of 25-39 with high saving potential.
• Every Bank has enough opportunities to perform without unhealthy competition.
• Business potential in Semi urban and rural areas are very high, which is yet to be explored.
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30. CHAPTER 7
LIMITATIONS
From this report provides an insight into ATM users’ perceptions, requirements and problems
Report will help banks and vendors in making ATM transactions user friendly and satisfying1.
• The findings of the survey were rather surprising – from more people accepting the norms of
depositing cash / cheques in these ATMs to waiting in long queues and finding no money left
in the machine.
• As many banks encourage the use of ATMs to their clients, ATMs have today become
indispensable tools for majority of banking transactions. But, the drawbacks still seem to
outweigh the benefits.
• The trends have changed with people visiting more frequently to these machines than
monthly and having started using value-added services like bill-payment and mobile top-ups
among others.
• Also highlights minor issues generally overlooked by banks – like non availability of deposit
envelopes and not being able to print receipts after a transaction.
• Customer tendency to borrow more and repay less may adversely affect the NPA levels in
future.
• Future delinquency rates are not properly factored in fixing the Retail credit pricing by few
banks
• Increased risk weight of Consumer Credit
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31. CHALLENGES
Retail banking has immense opportunities in a growing economy like India. As the growth story gets
unfolded in India, retail banking is going to emerge a major driver, recently identified India as the
"second most attractive retail destination" of 30 emergent markets.
The rise of the Indian middle class is an important contributory factor in this regard. The percentage
of middle to high income Indian households is expected to continue rising. The younger population
not only wields increasing purchasing power, but as far as acquiring personal debt is concerned, they
are perhaps more comfortable than previous generations. Improving consumer purchasing power,
coupled with more liberal attitudes toward personal debt, is contributing to India’s retail banking
segment.
Retention of customers is going to be a major challenge. According to a research by Reichheld and
Sasser in the Harvard Business Review, 5 per cent increase in customer retention can increase
profitability by 35 per cent in banking business, 50 per cent in insurance and brokerage, and 125 per
cent in the consumer credit card market. Thus, banks need to emphasize retaining customers and
increasing market share. . KYC Issues and money laundering risks in retail banking is yet another
important issue. Retail lending is often regarded as a low risk area for money laundering because of
the perception of the sums involved. However, competition for clients may also lead to KYC
procedures being waived in the bid for new business. Banks must also consider seriously the type of
identification documents they will accept and other processes to be completed. The Reserve Bank
has issued details guidelines on application of KYC norms in November 2016.
SCOPE OF THE STUDY
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32. • Study related to the products and services of retail banking provided by HDFC Bank.
• All Over India HDFC Bank centers
• Objective of rationale study.
• Need and dislike of customers related to products and services.
• Measures to improve the level of customer’s expectation.
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33. Conclusion
The banking industry has a very important role to play in the common man’s life. The middle class
in India is big in number and ever growing. Therefore, in order to satisfy the requirements of this
growing middle class, banks have to offer the best of financial products and services, and that too at
an attractive cost. Doing this project was a great experience and in the deal I learnt quite a bit about
the banking sector, specially the retail segment. In finding out more about this sector, I have
collected invaluable information about the banking industry. What I have tried to do here is to gain
an understanding of banks, particularly focusing my attention on the retail segment, which is such an
important part of each one’s life today.
As a very famous saying goes “Degrees Can Be Put On Display, But Knowledge Can’t”, what I
have presented here is just a project but what I have earned in the meanwhile is something which is
much more precious that anything in this world i.e. knowledge. So doing this project has definitely
added to my knowledge.
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34. APPENDIX
QUESTIONNAIRE
1) Name of the Customer: ___________________________
2) Address of the Customer: __________________________
__________________________
__________________________
3) Age: __________
4) Occupation______________________
Less than
Rs.10000/-
More than
Rs.10001/-
to 25000/-
More than
Rs.25001/-
to 50000/-
More than
Rs.50001/-
to 100000/-
Above
100000/-
6) What facilities you utilize from your bank
Home Loan Saving A/c Credit Card Net Banking ATM
E-Payment Insta Alerts Lockers.
OD / FD /
CC
7) Whether you are utilizing the services provided by the bank?
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35. Yes No
8) How much time you utilized these services in a year?
Services Daily Weekly Monthly Quarterly Yearly
ATM
E-Payment
Insta Alerts
Net Banking
Phone Banking
Locker
9) Please rank the factors according to you is necessary for utilizing the services
of bank
Advise from Friends
Independently
Existing customers
Phone Banking
Economic Situation
10) What is the level of service provided by HDFC BANK?
Excellent Very Good Good
Average Bad
11) Based on your past experience with bank, have you ever changed your
Bank?
Yes No
12) What measures should be taken for improving the level of services of HDFC Bank?
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36. BIBLIOGRAPHY
BOOKS
o Kothari C.R (2015).Research Methodology. New Delhi, New Age International Publishers
o Indian Institute of Banking and Finance(2012).Advanced bank management. New Delhi ,
Macmillan Publishers
WEBLIOGRAPHY
o HDFC BANK(2017 SEPTEMBER 05)Annual Report of HDFC BANK retrieved
from<https://www.hdfcbank.com/aboutus/cg/annual_reports.htm>
o HDFC BANK(2017 SEPTEMBER 05) Company Profile retrieved from
<https://www.hdfcbank.com/>
o Smriti Chand (2017 AUGUST 28) Indian Banking System retrieved
from<http://www.yourarticlelibrary.com/banking/indian-banking-system-structure-and-
other-details-with-diagrams/23495/>
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