To Identify Service Qulaity Gaps in Banking Sector in India

To identify service quality gaps in
banking sector: A comparative study of
public, private and foreign banks
2/28/2015
Indian Institute Of Social Welfare And Business Management
By Mr.SAMIK DATTA And SENJUTI SARKAR
MBA Day 2013-15
Marketing (Major)/Finance (Minor)

To identify service quality gaps in banking sector: A comparative study of public, private and foreign
banks
By Mr.SAMIK DATTA
Page 1
Acknowledgment:
We, Ms. Senjuti Sarkar and Mr.Samik Datta, the students of marketing
specialization from Indian Institute of Social Welfare and Business Management
(IISWBM), Kolkata, want to take this opportunity to thank all those who have
extended their enthusiastic support in helping me to complete this endeavour.
This Dissertation of mine is concentrated on the fact of “Service Quality Gap
within public, private and foreign sector banks”. There are five major factors in
the “SERV QUAL” factors are there like tangibility, reliability, responsiveness,
assurance and empathy. In this process of research work I have tried to find out
the dependency of the total perceived service experience with respect to the five
“SERV QUAL” factors.
We would first like to convey our gratitude to the writer of the thesis, A Study on
customer Service Quality of Banks in India, Dr. Manasa Nagabhushanam, who is
also the Lead Researcher of Analyz Research Soultions Pvt. Limited for providing
us a platform from where the interest to work on this project has popped in my
mind. Many of the concepts have been an extension of her research work. Apart
from this I am thankful to our head of the department Dr. Tanima Ray Madam to
allow the opportunity to work on this project.
Thanking you in anticipation.
Date: 28/02/2015
Place: IISWBM, Kolkata

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Institute certificate:
This is to certify that Mr. Samik Datta and Ms. Senjuti Sarkar, is a
bonafide student of the institute and has successfully completed his
dissertation project entitled ““Service Quality Gap within public, private and
foreign sector banks” for the fulfilment of the course MBA Day 2013-15
(Major: Marketing and Minor : Finance) from IISWBM, Kolkata.
---------------------------------------------
Prof. (Dr.) Tanima Roy
Head of the Department
MBA Day
IISWBM, Kolkata

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Table of Contents
Abstract: ........................................................................................................... 4
Introduction: ..................................................................................................... 4
Role of banking sector in Indian Economy: .................................................... 5
Indian Banking Industry and Service Quality:................................................. 7
Measuring service quality in banking sector: ................................................... 9
Objectives of the Study: ................................................................................... 11
Short-term objectives:................................................................................... 11
Long-term objectives:................................................................................... 11
Management Decision Problem: .................................................................. 11
Market Research Problem: ........................................................................... 11
Scope of the Study:.......................................................................................... 12
Limitations of the Study: ................................................................................. 13
Methodology of Study: .................................................................................... 13
A discussion about proper perceived service quality and shortfall in banking
Industry with current examples:....................................................................... 14
The current situations and 2013-2014 fiscal years:......................................... 14
Research Statement and Data Collection:......................................................... 17
Analysis of Data:............................................................................................. 18
Primary Data Analysis:................................................................................ 18
Recommendations and Conclusions:................................................................ 44
Further scope of extensive research: ................................................................. 45
Bibliography:................................................................................................... 45
Appendix: ....................................................................................................... 45
Requisite documents:................................................................................... 45
Questionnaire: ............................................................................................. 45
Response Sheets:.......................................................................................... 45
Important Table used for calculations:.......................................................... 45

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Abstract:
Service quality is a comparison between expectations and performance. From
business administration view point , service quality is an achievement in customer
service. It reflects at each service encounter. A customer's expectation for a
particular service is determined by, factors such as peer recommendations,
personal needs and past experiences. The expected service and the perceived
service sometimes may not be equal, thus leaving a gap. The service quality model
or the "GAP model" developed by the authors- Parasuraman, Zeithaml and Berry
at Texas and North Carolina in 1985, highlights the main requirements for
delivering high service quality. It identifies "gaps" that cause unsuccessful delivery
of service. Customers generally have a tendency to compare the service they
'experience' with the service they 'expect'. If the experience does not match the
expectation, there arises a gap.
Now in this process of finding the service quality gap we are actually trying to
realize that the five attribute have any effect on the total perceived quality or not.
At the same time out motto is to find out how these five attribute dependency
varies from one cluster of bank to another cluster, ranging from public to foreign
sector banks.
Therefore with this research we have tried to We will try to find out the service
quality gap within the banking sectors. The comparison of the service quality gap
will be depicted between Public sector bank, private sector bank and foreign
banks.
There will be also the analytical evidences that whether the five attributes like
tangibility, reliability, responsiveness, assurance and empathy has any effect to
determine the overall service quality by the consumes or not.
Method of data collection is online. The data cleaning is done using methods of
mean replacement, clustering etc.

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Introduction:
Bank plays an important role in the economic development of a country. A
financial institution accepts deposits and channels those deposits into lending
activities either directly or through capital markets. A bank connects customers
that have capital deficits to those customers with capital surpluses. The banking
industry in India is facing certain challenges of quality service, customer
satisfaction, customer retention, customer loyalty; Quality service plays a major
role in achieving customer satisfaction, and creating brand loyalty in banking
sector.
Role of banking sector in Indian Economy:
The Government of India, after independence had to focus on many areas among
which one of the important tasks was economic development of the country. In
this context, the industrial policy resolution in 1948 focused on mixed economy,
which played an active role in development of different sectors including banking
and finance. A major step in this direction was the nationalization of banks in
1948. The Banking regulation Act was enacted which empowered the Reserve
Bank of India (RBI) to regulate, control and inspect the banks in India. In other
words all the banks in India fell under jurisdiction of Reserve Bank of India under
the Banking Regulation Act.
The Government of India nationalized private banks in 1969 and later in 1980 in
order to have better control over this sector. Government of India controls around
91% of the banking business in India. In early 1990‟s the prime minister of India
P.V. Narshima Rao liberalized the sector by giving licence to small number of
private banks, which came to be known as new generation tech-savy banks.
Among these banks were, Global Trust Bank (now Oriental Bank of Commerce),
UTI (Now renamed as Axis Bank), ICICI Bank and HDFC Bank. The banking
sector of India constitutes government banks, private banks and foreign banks.
1. Mobilizing Saving for Capital Formation:
The commercial banks help in mobilizing savings through network of branch
banking. People in developing countries have low incomes but the banks induce
them to save by introducing variety of deposit schemes to suit the needs of
individual depositors. They also mobilize idle savings of the few rich. By
mobilizing savings, the banks channelize them into productive investments. Thus,
they help in the capital formation of a developing country.
2. Financing Industry:
The commercial banks finance the industrial sector in a number of ways. They
provide short-term, medium-term and long-term loans to industry. In India they
provide short-term loans. Income of the Latin American countries like
Guatemala, they advance medium-term loans for one to three years. But in
Korea, the commercial banks also advance long-term loans to industry.
In India, the commercial banks undertake short-term and medium-term financing
of small scale industries, and also provide hire- purchase finance. Besides, they
underwrite the shares and debentures of large scale industries. Thus they not only

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provide finance for industry but also help in developing the capital market which
is undeveloped in such countries.
3. Financing Trade:
The commercial banks help in financing both internal and external trade. The
banks provide loans to retailers and wholesalers to stock goods in which they deal.
They also help in the movement of goods from one place to another by providing
all types of facilities such as discounting and accepting bills of exchange,
providing overdraft facilities, issuing drafts, etc. Moreover, they finance both
exports and imports of developing countries by providing foreign exchange
facilities to importers and exporters of goods.
4. Financing Agriculture:
The commercial banks help the large agricultural sector in developing countries in
a number of ways. They provide loans to traders in agricultural commodities.
They open a network of branches in rural areas to provide agricultural credit.
They provide finance directly to agriculturists for the marketing of their produce,
for the modernisation and mechanization of their farms, for providing irrigation
facilities, for developing land, etc.
They also provide financial assistance for animal husbandry, dairy farming, sheep
breeding, poultry farming, pisciculture and horticulture. The small and marginal
farmers and landless agricultural workers, artisans and petty shopkeepers in rural
areas are provided financial assistance through the regional rural banks in India.
These regional rural banks operate under a commercial bank. Thus the
commercial banks meet the credit requirements of all types of rural people.
5. Financing Consumer Activities:
People in underdeveloped countries being poor and having low incomes do not
possess sufficient financial resources to buy durable consumer goods. The
commercial banks advance loans to consumers for the purchase of such items as
houses, scooters, fans, refrigerators, etc. In this way, they also help in raising the
standard of living of the people in developing countries by providing loans for
consumptive activities.
6. Financing Employment Generating Activities:
The commercial banks finance employment-generating activities in developing
countries. They provide loans for the education of young person‟s studying in
engineering, medical and other vocational institutes of higher learning. They
advance loans to young entrepreneurs, medical and engineering graduates, and
other technically trained persons in establishing their own business. A number of
commercial banks in India is providing such loan facilities. Thus, the banks not
only help inhuman capital formation but also in increasing entrepreneurial
activities in developing countries.
7. Help in Monetary Policy:

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The commercial banks help the economic development of a country by faithfully
following the monetary policy of the central bank. In fact, the central bank
depends upon the commercial banks for the success of its policy of monetary
management in keeping with requirements of a developing economy.
Thus, the commercial banks contribute much to the growth of a developing
economy by granting loans to agriculture, trade and industry, by helping in
physical and human capital formation and by following the monetary policy of
the country.
Indian Banking Industry and Service Quality:
There are varieties of services offered by Indian banking industries and most of
them are related to financial services. The modes of providing services are either
B2B or B2C or B2G. The major services that bank can provide to its customers
are as follows:
 Current Account
 ATM Cards & Laser Cards
 Savings account
 Investments
 Credit Card
 Insurance
 Mortgage
 Online banking
 Pension
Now we will discuss the effectiveness of these services in human life:
Current Account:
A Current Account is a common type of bank account which is used to store
money, which is needed on a regular basis. It is a useful way to manage your
money in the short-term. It allows us to:
 Receive money such as our salary or other types of income.
 Withdraw cash by using our ATM (Automated Teller Machine) or Laser
Card at the bank counter.
 Pay for things using our Laser Card or by writing cheques
 We can transfer money to other accounts.
 Bank using the internet or the telephone.
 We can pay bills.
Till date the current account service provided by Indian banks mostly in B2B
transactions.
Savings Account:
Savings accounts are a type of bank, building society, credit union or An post
account that is used for accumulating money. Funds saved can be for both short
and long-term needs.
Short-term needs include things like holidays, weddings and short term
investments.

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Longer-term needs include things like saving for car purchase or a house. There
are many different types of savings accounts available.
Generally speaking, savings accounts can be opened with a small sum of
money and you can save either regular amounts or lumps sums, or sometimes
both.
A Savings Account accumulates interest which actually increases the fund
value. Interest rates can be either fixed or variable.
The Government charges DIRT (Deposit Interest Retention Tax) on the
interest earned on savings. This tax is automatically taken from your account.
ATM Cards & Laser Cards:
 ATM Cards are used to withdraw cash from our current or savings
account
 We can use our ATM card abroad so long as our card has a Link logo on
the back.
 We can use our ATM card at any banks‟ ATM machines
 Using cash Laser Cards (also known as Debit Cards) allow us to pay for
items at POS (Point of Sale) terminals in most shops, restaurants, and now
even in some taxis.
 Some retailers will give us the option of receiving “cash back”, the amount
of which is added to the transaction on our laser card.
Investments:
Investment involves purchasing a financial product or other item of some
specified value with the expectation that the value of the item will increase over
time. Simply put, investment means spending money in the hope of making more
money.
Investments can offer us a better return on our money in the longer-term
compared to savings accounts. However, certain investments may carry a higher
level of risk.
Credit Card:
Credit cards are usually a “pay later” concept as they let us purchase an item and
pay for it sometime in the future.
VISA, MasterCard, Maestro are the two main types of Credit Card in India.
Credit cards are mainly provided by banks, but some retailers and airlines also
provide their own credit cards.
According to financial rule in India a person must be 18 years or over to use a
Credit Card.
Insurance:

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Insurance is a form of risk management – you pay a set amount called a premium
to an insurer and the insurer agrees to cover the costs associated with certain risks
that could be financially devastating if they were to happen. There are a number
of different types of insurance including:
Car Insurance
By law if we have a car we must have third party insurance. Third party insurance
covers any injury or loss suffered by other people as a result of our driving.
Comprehensive insurance is an “all inclusive” type of insurance that covers the
cost of repair or replacement if our car is stolen, damaged or destroyed and
includes any loss suffered by Third parties.
Home Insurance
Some of the risks your home may be subject to include damage by fire or flooding,
burglary or someone injuring themselves on your property. Taking out insurance
can cover you for some of these risks.
Travel Insurance
There are many risks associated with travel including damage or delay of luggage,
cancelled flights, delayed or missed departure, loss or theft of money or passport
and illness or injury. Travel insurance can help compensate us in the eventuality
of these things happening.
Health Insurance
Private health insurance helps us to cover medical or hospital expenses if we or
our family get sick, have and accident or need an operation.
Payment Protection insurance
Payment Protection insurance is designed to cover our repayments on a loan if we
suffer from an accident, illness, death or redundancy.
Mortgage:
Mortgage is a special type of loan offered by banks and building societies which
enable people to buy properties. It‟s typically a big loan, paid back by the
borrower over 25 or 30 years, in monthly installments.
Some different types of Mortgages are:
Mortgage
This is the most common type of mortgage. The monthly repayment consists of
the original loan amount (or capital repayment) and the interest payment. At the
beginning of the mortgage‟s life, most of the monthly repayment goes towards the
interest. Towards the end, more of the monthly payment goes towards the capital
repayment.
Interest-only mortgage
With this type of mortgage the monthly repayment only covers the interest on
the mortgage and not the capital. The original loan must be repaid in a lump sum
at the end of the mortgage term.
Measuring service quality in banking sector:

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Service quality has been identified as a critical success factor for a organization to
build their competitive advantage and increase their competitiveness. Pioneering
work by Parasuraman (1985) and led to a list of ten determinants (reliability;
responsiveness; competence; access; courtesy; communication; credibility;
security; understanding the customer; and tangibles) of service quality as a result
of their focus group studies with service providers and customers which
subsequently resulted in the development. But among all these ten factors only
five are the main determinant of the quality and they are tangibility, reliability,
responsiveness, assurance and empathy.
(1)Tangibles, which pertain to the physical facilities, equipment, personnel and
communication materials; Parasuraman (1985) defined tangibility as the
appearance of physical facilities, equipment, personnel, and written materials.
Ananth referred to tangibility in their study of private sector banks as modern
looking equipment, physical facility, employees are well dressed and materials are
visually appealing.
(2)Reliability, which refers to the ability to perform the promised services
dependably and accurately; Reliability depends on handling customers' services
problems; performing services right the first time; provide services at the
promised time and maintaining error-free record. Furthermore, they stated
reliability as the most important factor in conventional service .Reliability also
consists of accurate order fulfillment; accurate record; accurate quote; accurate in
billing; accurate calculation of commissions; keep services promise. He also
mentioned that reliability is the most important factor in banking services
(3)Responsiveness, which refers to the willingness of service providers to help
customers and provide prompt service; Responsiveness defined as the willingness
or readiness of employees to provide service. It involves timeliness of services. It is
also involves understanding needs and wants of the customers, convenient
operating hours, individual attention given by the staff, attention to problems and
customers. safety in their transaction.
(4)Assurance, which relates to the knowledge and courtesy of employees and
their ability to convey trust and confidence; Parasuraman et al. (1985) defined
assurance as knowledge and courtesy of employees and their ability to inspire
trust and confidence. According to Sadek et al. (2010), in British banks assurance
means the polite and friendly staff, provision of financial advice, interior comfort,
eases of access to account information and knowledgeable and experienced
management team.
(5)Empathy, which refers to the provision of caring and individualized attention
to customers; Parasuraman et al. (1985) defined empathy as the caring and
individual attention the firm provides its customers. It involves giving customers
individual attention and employees who understand the needs of their customers
and convenience business hours. Ananth et al. (2011) referred to empathy in their

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study on private sector banks as giving individual attention; convenient operating
hours; giving personal attention; best interest in heart and understand customer.s
specific needs.
While consumes comes to the banks these are the basic qualities they always look
for. Now in general as per the general perseverance of the customer the
perceptions are as follows:
For Public Sector Banks, the domains of tangibles are very poor, banks are
reliable, and responsiveness is optimal, assurance is high and empathy is least.
For Private Sector Banks, the domains of tangibles are very high, reliability is at
the low ebb, and responsiveness is high, assurance is optimal and empathy is
extraordinary.
For Foreign Banks, the domains of tangibles are very high, reliability is high, and
responsiveness is very quick, assurance is maximum and empathy is up to the
mark.
Objectives of the Study:
Short-term objectives:
The short term objective of this research paper is:
 To find out the factors that has an impact on the perceived qualities of the
services in different clusters of banking sectors within India.
 To find out the Strength, Weakness, Opportunities and Threat of different
banking cluster one with respect to another.
 To investigate the all the policies of different banking and how the different
clusters of banks implement these policies while delivering their services.
Long-term objectives:
 To establish best service qualities barring the different clusters.
 To reduce competitive rivalry and increase the service dependencies
between the different clusters of banks.
 To induce healthy competition with respect to best service delivery
between all the clusters.
Management Decision Problem:
What are the service gaps in the banking Industry?
Market Research Problem:
What are the pot holes in the service process of Public sector Banks in India?
What are the deficient alongside the service provided by Private Sector Banks in
India?
What are the service quality gaps for foreign sector bank in India?
What are the challenges Foreign banks are facing while penetrating Indian soil?

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Scope of the Study:
This study can be incorporated to study or research the following domains, like:
1. A comparative study between Indian Public, Private and Foreign sector
banks:
 The dissertation project can give a comparative idea that that how
the individual banks are performing in intra and inter group
banking market.
 Suppose someone needs a comparative analysis between the service
quality between two market leaders like SBI and ICICI bank or
Canara Bank and HDFC bank, and then the information of this
study will be helpful.
 The threat that the public, nationalized and private sector banks are
facing due to the presence of foreign sector banks.
 The nascent sectors of Indian banking industry.
 Scope of market penetration for all the clusters of banks.
2. Current status of Indian Banking industry:
Introduction of Liberalization Privatization and Globalization (LPG) in
Indian economy has affected almost all the sectors and industries of the
economy. Indian banking industry is no exception to that. The net result of
such policy initiatives has been increased competition at the marketplace.
The fight for customers has got intensified. Literatures establish a direct
link between service quality and marketing performance of banks thus
concluding that loyal customer base can only be created through superior
service. Hence effectiveness of service quality of banks is largely being
tested to forecast the marketing performances of the banks. It has also been
seen that degree and effectiveness of service quality has been said to be
different in case of public and private sector bank.
This study will clarify the process like followings:
Test of Tangibility
1. Does the bank have modern looking equipment?
2. Are the bank's receptions desk employees neat appearing?
Test of Reliability
1. When the bank promises to do something by a certain time, it does so
2. When you have a problem, the bank is sympathetic and reassuring
3. Are the employees in the bank area polite with you?
Test of responsiveness:
1. Do the Employees in the bank give your prompt service?
2. Are employees in the bank always willing to help you?
Test of Assurance:

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1. Does the behavior of employees in the bank instill trust in you?
2. Do you feel safe in your transactions with the bank?
3. Do the employees in the bank have the knowledge to answer your
questions?
Test of Empathy:
1. Do the employees of the bank understand your specific needs?
2. Does the bank have operating hours convenient to all its customers?
3. Does the bank have your best interest at heart?
3. Where will you invest to get the best return?
 Which bank should you use for the purpose of investment?
 What does the consumer feel for, prior to investing in a bank?
 How others are feeling about the service quality of the three clusters
of banks
4. Customer Relationship Management and its realistic analysis using the
banking clusters in India.
Approaches and service delivery pattern of all the clusters towards the
banking sector.
Limitations of the Study:
 The Study is based on the response of only forty two responses.
 The post data cleaning sample size is 31.
 Some people have answered in biased way.
 The survey is based on online survey method only.
 Diversified responses.
 Very short response time.
 Short Duration of research work (only 30 days).
 Lack of capital (both financial and resource).
Methodology of Study:
 Defining the research problem, here the aim was to find out the condition
of banking sectors which deals in the consumer service.
 The first objective of knowing the current market scenario is studied using
the methodology of taking responses from the consumers.
 The secondary data from the websites and the informations and contact
numbers of the big players of the sector in and around Kolkata was one of
the prime methodologies of primary data collection.

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 From the collected data of the sector and it is client market clusters are
made divided and the required graphical representations are made.
 After that each cluster of public, private and foreign banks perceived and
expected qualities are calculated using regression analysis.
 The guidelines and rules of RBI are used to find out the expected amount
of credit need of individual organization.
A discussion about proper perceived service quality and shortfall in
banking Industry with current examples:
India is a country where the whole industry depends upon the banking sector.
Most of the capital requirement and capital budgeting is done by the banks under
the guidance of RBI. With the potential to become the fifth largest banking
industry in the world by 2020 and third largest by 2025 according to KPMG-CII
report, India‟s banking and financial sector is expanding rapidly. The Indian
Banking industry is currently worth Rs. 81 trillion (US $ 1.31 trillion) and banks
are now utilizing the latest technologies like internet and mobile devices to carry
out transactions and communicate with the masses. The Indian banking sector
consists of 26 public sector banks, 20 private sector banks and 43 foreign banks
along with 61 regional rural banks (RRBs) and more than 90,000 credit
cooperatives.
Factors promoting growth of Banking and Financial Services
The Banking Laws (Amendment) Bill that was passed by the Parliament in 2012
allowed the Reserve Bank of India (RBI) to make final guidelines on issuing new
bank licenses. Moreover, the role of the Indian Government in expanding the
banking sector is noteworthy. It is expected that the new guidelines issued by RBI
will curb practices of impish borrowers and streamline the loan system in the
country. In the coming time, India could see a rise in the number of banks in the
country, a shift in the style of operation, which could also evolve by incorporating
modern technology in the industry.
Another emerging trend witnessed by the banking sector is the use of social media
platform like Facebook to attract customers. In September 2013 ICICI bank
launched a Facebook bill payment and fund transfer service called „Pockets‟ for
customer convenience.
According to a report by Zinnov, a Globalization and Market Expansion firm, „IT
adoption in BSFI sector in India‟, the Information Technology Industry spend in
BFSI vertical is expected to reach USD 3.5 billion by Financial Year 2014. The
study also highlighted „the growing maturity of Indian BFSI organizations in IT
adoption, as technology is seen as a driver of business value. Technology firms
have great potential to explore in the BFSI sector, which contributes to eight per
cent of India's Gross Domestic Product.‟
The current situations and 2013-2014 fiscal years:
Global growth did not recover as expected across most major developed and
rapid-growth economies in 2013-14. During the year gone by, the central bankers

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across the globe took decisive steps to restore confidence in markets and broader
economy. In Europe, the banking situation improved in part due to the long-term
refinancing operations of the European Central Bank (ECB), which helped ensure
there was plenty of liquidity in the system. In the US, the picture was more upbeat
but still mixed. And although businesses and consumers started to borrow again,
credit growth remained tepid. The global economic environment broadly
strengthened, and is expected to improve further, with much of the growth
impetus emanating from advanced economies. There was acute financial volatility
in emerging market economies, and increases in the cost of capital which
dampened investments and weighed on growth.
The banking sector, being the barometer of the economy, is reflective of the
macro-economic variables. While the Indian economy is yet to catch strength, the
Indian banking system continues to deal with improvement in asset quality,
execution of prudent risk management practices and capital adequacy.
The Reserve Bank of India (RBI) maintained a status quo in interest rate since
January 2014. However, despite the retail inflation softening in recent periods, it'll
be a little while before the Central Bank would opt for rate cut.
Indian banking industry, with total asset size of Rs 81 trillion (USD 1.34 trillion),
is expanding continuously but on a cautious note. The fact that the industry is
plagued by bad loans, the lenders have chosen to go slow in terms of credit off
take. Fiscal 2014 saw a combination of various external and internal events that
kept markets turbulent, interest rates high and investor confidence low, resulting
in shrinking investment and GDP growth.
The key words that prevails the service quality in Indian Banking cluster:
Supply: The process of liquidity is controlled by Reserve Bank of India(RBI).
Demand: India is a growing economy and demand for credit is high through it
could be cyclical.
Barrier to entry: The main barrier to entry is licensing requirement, investment in
technology and branch network, capital and regulatory requirements.
Bargaining power of supplies: This power is high during periods of tight
liquidity. Trade union in public sector banks can be anti-reforms and orchestrate
strikes.
Bargaining power of customers: For good creditworthy borrowers bargaining
power is high due to the availability of large number of banks.
Competition: High- There is public sector banks, private sector and foreign
banks along with non-banking finance companies competing in similar business
segments. Plus the RBI is all set to issue new banking licenses soon.
The Achievements and Agendas of Financial Year '14:
India's underlying economic growth trends remained weak during
FY14. High and persistent inflation remained a key macroeconomic challenge
facing India throughout the FY14.
During the year, the operating environment for the banking system continued to
be challenging with persistent high inflation, muted growth, slowdown in credit
off-take, concerns over higher non-performing assets and a high incidence of
restructured assets.

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Against the backdrop of a slowdown in the domestic economy and tepid global
recovery, the growth of Indian banking sector too remained under pressure in
FY14. That said, the deposit and credit growth was marginally better than that in
FY13. The growth in deposits of scheduled commercial banks (SCBs) at 14.6% in
FY14 was marginally better than the growth at 14.2% in the previous financial
year. However, this growth came on the back of the liberal policy adopted by the
RBI towards non-resident Indian deposits. The credit growth at 14.3% in FY14
too was marginally better than that at 14.1% in FY13. As a part of monetary
transmission, base rate of major banks inched up from 9.70%-10.25% in April
2013 to 10.0% -10.25% in March 2014, while deposit rates were readjusted from
7.5%-9.00% to 8.0%-9.25% in the same period.
In FY14, private sector lenders experienced significant growth in credit cards and
personal loan businesses.
Owing to elevated inflation levels, the banks were compelled to offer
attractive interest rates on their term deposits so as to protect their liability
franchise. The higher deposit rates coupled with lower credit off take impacted the
net interest income and thereby the earnings profile of commercial banks.
Additionally, the macroeconomic challenges and poor repayment capacity of
borrower's deteriorated the banks' asset quality further in FY14. Consequently, the
restructured assets moved north during the year. However, despite the challenging
environment, few banks with prudent risk management systems and the ones with
robust cash recovery delivered a sound performance during FY14.
The aggregated profit after tax (PAT) of PSBs declined by 27% YoY
during FY14. The gross NPAs of banks (PSBs + private) increased over the last
one year from 3.3% to 3.9% as on March 2014. Restructured advances of the
PSBs remain at elevated levels of 6.2% as on March 31, 2014. Private sector banks
were able to hold on good asset quality as reflected in their gross NPAs of 1.8% as
on March 2014. Banks started reporting capital adequacy as per Basel III norms
since June 2013. The Tier 1 capital of PSBs stood at around 8.6% as on March 31,
2014 as against the required Tier 1 capital of 6.5%, while that of private sector
banks was well above the norms around 12.8%. Return on net worth for PSBs
dropped to single digit in FY14.
(data taken from: RBI, ET and
www.equitymaster.com)
Prospects of FY 2015-16
While the medium term prospects point towards an improving growth scenario,
given the improved macroeconomic fundamentals it is highly likely that there will
only be a modest economic recovery in FY15.
o That said, the Indian economy is now on the threshold of a major
transformation, with expectations of policy initiatives by the change
in guard at the Centre. Positive business sentiments, improved
consumer confidence and more controlled inflation should help
boost the economic growth. With a new and stable Government in
place now, a clear revival in the investment climate is sure to come.

banks
By Mr.SAMIK DATTA
Page 17
o Higher spending on infrastructure, speedy implementation of
projects and continuation of reforms will provide further impetus to
growth. A moderate recovery is likely to be seen in FY15 and the
real GDP is expected to grow by 5.3%-5.5%. While the CPI
inflation is expected to remain an important challenge for India, it
should witness a downward trajectory during the major part of
FY15
o The worst seems to be over for the Indian banking industry, as there
will be increased clarity on macroeconomic and political fronts
during FY15. On the positive side, liquidity remains steady,
inflation is expected to move downwards for the major part of
FY15 and the RBI is in full control to manage any volatility.
Macroeconomic improvements and potential for post-election
reforms should see a gradual reduction in stressed loans on lower
slippages and higher recoveries. Recovery in macroeconomic
environment and expected revival in economic growth will help to
mitigate risks and resolve problems of asset quality.
o Not just that, the banking industry may see more participants and
greater healthy competition. Two new banks have already received
licences from the RBI i.e. IDFC and Bandhan Group, which apart
from providing impetus to financial inclusion, is expected to
intensify competition in the banking sector in the medium term. In
addition, by postponing the implementation of Basel III capital
norm by one year, RBI has given some breathing space to banks
struggling with stressed margins and lower profitability on account
of increase in NPAs. The RBI's new norms will further encourage
banks to identify potential bad loans and take corrective actions.
o The overall credit growth may revive marginally at 14-15% in
FY15; private sector banks may continue to outpace PSBs in credit
growth. Overall (PSBs + private banks) gross NPAs could remain at
4-4.2% by FY15 as against 3.9% in FY14.
o Banks need to raise capital of Rs. 1.8-2 trillion over the next two
years (FY15-FY16); of which 45-50% may be issued in the form of
additional Tier 1, 35-40 % through Tier II and balance through
common equity. However, if there are no seekers for additional Tier
1 capital instruments, Indian banks may need to mop up Rs. 1-1.3
trillion common equity capital over the next two years as
mentioned by a rating agency report.
Research Statement and Data Collection:
We will try to find out the service quality gap within the banking sectors. The
comparison of the service quality gap will be depicted between Public sector bank,
private sector bank and foreign banks.
There will be also the analytical evidences that whether the five attributes like
tangibility, reliability, responsiveness, assurance and empathy has any effect to
determine the overall service quality by the consumes or not.

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By Mr.SAMIK DATTA
Page 18
Method of data collection is online. The data cleaning is done using methods of
mean replacement, clustering etc.
Analysis of Data:
There were six major questions that is being asked in the questionnaire and those
are:
The rating (1 to 5) the respondent want to provide for the “Total perceived or
experienced service quality” which he/she experienced while dealing with
public, private or foreign sector banks individually.
The rating (1 to 5) the respondent want to provide regarding the quality for the
“perceived or experienced with respect to Tangibility” which he/she experienced
while dealing with public, private or foreign sector banks individually.
“perceived or experienced with respect to Reliability” which he/she experienced
“perceived or experienced with respect to Responsiveness” which he/she
experienced while dealing with public, private or foreign sector banks
individually.
“perceived or experienced with respect to Assurance” which he/she experienced
“perceived or experienced with respect to Empathy” which he/she experienced
There was also another format of question where the respondents have to tell us
their total expectation from the service received from any particular cluster of
banks in a scale rating of 5.
Primary Data Analysis:
We have divided our analysis in four different strata.
1. The Analysis of the data collected for the public sector banks.
A. The descriptive analysis of the collected data using descriptive
statistics
B. The Inferential analysis of the collected data using inferential
statistics.
2. The Analysis of the data collected for the private sector banks.
statistics
statistics.
3. The Analysis of the data collected for the foreign sector banks.

banks
By Mr.SAMIK DATTA
Page 19
statistics.
statistics.
4. Comparative study of public, private and foreign sectors banks.
The Analysis of the data collected for the public sector banks:
A. The descriptive analysis of the collected data using descriptive statistics
Descriptive Statistics
Mean Std. Deviation N
Service Quality 3.5000 .64550 31
Tangibility 3.6935 .78185 31
Reliability 3.5433 .82533 31
Responsiveness 3.3166 .91727 31
Assurance 3.6727 .72263 31
Empathy 3.5961 .74728 31
This gives the statistical analysis of the mean and standard deviation of
values of all the 31 respondents. The Service quality mean is more or less nearer
to the mean of the individual service qualities like tangibility, reliability,
responsiveness, assurance and empathy. Therefore the distribution is evenly
distributed.
 The percentage service quality gap for public sector banks:
Public sector Banks
Mean_ESQ 4.35
Qlty Tangibility 3.69 Gap due to tangibility 0.66
Qlty Reliability 3.54 Gap due to Reliability 0.81
Qlty Responsiveness 3.32
Gap due to
Responsiveness 1.03
Qlty Assurance 3.67 Gap due to tangibility 0.68
Qlty Empathy 3.60 Gap due to Empathy 0.75
Qlty total Service 3.50
Gap due to total
service Qlty 0.85
Mean ESQ= Mean Expected service Quality.
Qlty Tangibility= Mean of quality of perceived tangibility of consumers.
Qlty Responsiveness= Mean of quality of perceived Responsiveness of
consumer.

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Qlty Assurance= Mean of quality of perceived Assurance of consumer.
Qlty Empathy= Mean of quality of perceived Empathy of consumer.
Qlty total Service= Mean of quality of perceived total Service of consumer.
 Analysis of the service quality gap with respect to the age range of the
respondants:
We have taken the age range of the respondents ranging between:
 15 years to 25 years
 More than 60 years
On the other hand the service quality gap has been catehories as:
Maximum ranging data is 0.50 and minimum ranging data is -2.0.
High = The service quality is satisfactory ( gap ranging from 0 to 0.50).
Medium= The service quality is optimum ( gap ranging from 0.0 to -1.00).
Low = The service quality is dis-satisfactory ( gap ranging from -1.00 to -
2.00).
The representation is as follows:
Age range
15-25 26-40 41-60
61-
above
Service
Quality
Gap
High 1 0 1 0 2
Medium 3 6 1 0 10
Low 2 11 5 1 19
6 17 7 1 31

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By Mr.SAMIK DATTA
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Graph: 1
 Analysis of the service quality gap with respect to the income group range
of the respondants:
We have taken the income range of the respondents ranging between:
 > Rs.60,000 Per Annum
 Rs.60,001 to Rs. 2,00,000 Per Annum
 Rs. 2,00,001 to Rs. 4,00,000 Per Annum
 Rs. 4,00,001 to Rs. 8,00,000 Per Annum
 More than 8,00,001 Per Annum
2.00).
Graph: 2

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The result we can conclude from the graphs are as follows:
Graph1 : The people within the age range 26-40, who are mostly professional
people, they have expericened low service qulaity and therefore for public sector
banks there is a big gap between the perceived and expected quality of service.
Same conclusion for age range of 41-60 years.
Graph 2 : As a whole the inference is most of the consumers irrespective of the
income level ladged a negative perceived value again the service quality,
therefore, for all kind of Income range public sector banks are providing least
satisfactory services.
B. The Inferential analysis of the collected data using inferential statistics.
I. Correlation Matrix:
II. Variables Entered/Removed

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Model
Variables Entered Variables
Removed
Method
1
Empathy,
Assurance,
Responsiveness,
Tangibility,
Reliablityb
. Enter
a. Dependent Variable: Service Quality
b. All requested variables entered.
III.
Model Summaryb
Model R R Square Adjusted R
Square
Std. Error of the Estimate
1 .971a
.942 .931 .16985
a. Predictors: (Constant), Empathy, Assurance, Responsiveness, Tangibility, Reliability
b. Dependent Variable: Service Quality
This part gives the information that whatever regression model we are creating that has
94.2 % reliability. That means with this sample data we can explain 94.2% of the model.
IV.
The ANNOVA table also defines that the mean of the regression and residual are
not equal. So going with the dependency relationship.
V. The Linear Regression co-efficient:

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Now this is the linear regression coefficients and the t-test significance
representation. Interpreting the results we can get the following conclusions:
 The regression equation contains in Y axis or dependable variable as
“Total experienced service quality” of the consumers and the independent
X axis variables are: Tangibility, reliability, responsiveness, assurance,
empathy qualities as per the consumer response. Now, we will examine
whether there is at all any dependency between the five variables over the
„service quality‟ that the consumers are getting.
 Analysing the result we can infer that except tangibility all the other
attribute have the significance level less than 0.05, so those
attributes have effect on the experienced service quality level.
 The regression equation would be:
Y =.182+.112X1+.208X2+.222X3+ .222X4+.172X5
X1= the experienced Service quality due to tangibility.
X2= the experienced Service quality due to reliability.
X3= the experienced Service quality due to responsiveness.
X4= the experienced Service quality due to assurance.
X5= the experienced Service quality due to empathy.
Y= Experienced Service Quality.
 Apart from this, within unstandardized coefficients all the B values
are greater than standard error value, which signifies there is a better
interdependency between the Y and X value and also intra data X
relations are there. And of course the with 94.2% reliable model.
Therefore we can conclude that there is direct effect of tangibility, reliability,
responsiveness, assurance and empathy over the service quality.
Now the standardise residual and service quality forms a histogram which gives
rise to a normal distribution, which signifies the accuracy of the data set.
The graph is depicted below:

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DESCRIPTIVE STATISTICS OF SERVICE GAP:
Now we will perform an MANNOVA test to prove that there is interdependencies between all
the five factors and total experienced service quality.
MANNOVA Table:

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By Mr.SAMIK DATTA
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All the attribute of the service factor showing significance .000, which is less than 0.05, so we
will reject the Null hypothesis and conclude that there, is dependency relationship between the
dependent total service quality and independent attributes.
2. The Analysis of the data collected for the private sector banks:
A. The descriptive analysis of the collected data using descriptive statistics
Tangibility 3.9400 1.09278 25
Reliability 3.7600 1.04314 25
Assurance 4.0313 .57926 25
Empathy 3.8009 .98339 25
This gives the statistical analysis of the mean and standard deviation of values of
all the 31 respondents. The Service quality mean is more or less nearer to the
mean of the individual service qualities like tangibility, reliability, responsiveness,
assurance and empathy. Therefore the distribution is evenly distributed. But all
the means are greater than the mean of each attribute for public sector banks.
 The percentage service quality gap for private sector banks:

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By Mr.SAMIK DATTA
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Private sector Banks
Mean_ESQ 4.37
Qlty Tangibility 3.78 Gap due to tangibility -0.43
Qlty Reliability 3.94 Gap due to Reliability -0.61
Gap due to
Responsiveness -0.33
Qlty Assurance 4.04 Gap due to tangibility -0.34
Qlty Empathy 4.03 Gap due to Empathy -0.57
Gap due to total
service Qlty -0.59
Mean ESQ= Mean Expected service Quality.
consumer.
respondants:

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By Mr.SAMIK DATTA
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2.00).
Graph: 1
Income Category
<60,000
60,001
INR -
2,00,000
INR
2,00,001
INR -
4,00,000
INR
4,00,001
INR -
8,00,000
INR
Above
8,00,000
Service
category
Highly
Satisfied
0.00% 0.00% 0.00% 0.00% 0.00%
Satisfied 20.00% 8.00% 12.00% 12.00% 12.00%
Dis-satisfied 8.00% 4.00% 4.00% 12.00% 8.00%
of the respondants:
 Rs.60,001 to Rs. 2,00,000 Per Annum
 Rs. 2,00,001 to Rs. 4,00,000 Per Annum
 Rs. 4,00,001 to Rs. 8,00,000 Per Annum

banks
By Mr.SAMIK DATTA
Page 29
2.00).
Graph: 2
Age Category
15-25
years
26-40
Years
41-60
Years
Above 60
years
Service
category
Highly Satisfied 0.00% 0.00% 0.00% 0.00%
Satisfied 20.00% 40.00% 0.00% 4.00%
Dis-satisfied 0.00% 24.00% 12.00% 0.00%
Graph1 : The Distribution of satisfied consumer are uniform.Except the salary
range of 4,00,000 to 8,00,000 within all other income categories the frequency of
satisfied people is greater than unsatisfied people. There is no highly satisfied
people dealing with private sector banking.
Graph 2 : The people within the age range 26-40, who are mostly professional
people, they have expericened satisfactory service qulaity and therefore for
public sector banks there is a littele gap between the perceived and expected
quality of service. But conclusion for age range of 41-60 yearsis different, for
these sample of people the service qulaity gap for the strata of people is high.

banks
By Mr.SAMIK DATTA
Page 30
Now, using different hypothesis we will try to draw some inferential or
conclusive decision about the gathered sample and perception about the
private banking.
We will use:
 Linear Regression Analysis, for finding out whether there is at all any
dependencies between the dependent variable, i.e. the total experienced or
perceived service quality and the independent variables, all the attribute
qualities.
 MANOVA, to found out the inter dependencies between the independent
attribute variables and the dependent variables.
 Descriptive statistics to identify the mean, median, mode and skewness.
We will start with linear regression model, where the correlation table gives us the
idea about the inter-dependencies between each of the attribute variables.
This table signifies:
 Tangibility and reliability is weakly co-related.
 Tangibility and responsiveness is highly co-related.
 Tangibility and Assurance is highly co-related.
 Tangibility and Empathy is highly co-related
 Reliability and responsiveness is weakly co-related.
 Reliability and Assurance is highly co-related.
 Reliability and empathy is weakly co-related.
 Responsiveness and Assurance is very highly co-related.
 Responsiveness and empathy is weakly co-related.
 Assurance and Empathy is weakly co-related.

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By Mr.SAMIK DATTA
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Linear regression model Summary:
Model Summaryb
Square
Std. Error of the
Estimate
1 .772a
.596 .515 .56033
a. Predictors: (Constant), Empathy, Reliability, Responsiveness,
Tangibility
This part gives the information that whatever regression model we are creating that has
59.6 % reliability. That means with this sample data we can explain 59.6 % of the model.
Therefore, the model of regression is not apt for this sample of data.
noANOVAa
Model Sum of Squares df Mean Square F Sig.
1
Regression 9.261 4 2.315 7.374 .001b
Residual 6.279 20 .314
Total 15.540 24
b. Predictors: (Constant), Empathy, Reliablity, Responsiveness, Tangibility
As the significance is <0.05, so the ANNOVA table also defines that the mean of the
regression and residual are not equal. Therefore, we will go the conclusion of the
dependency relationship of the dependent and independent variable.

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By Mr.SAMIK DATTA
Page 32
Now this result of linear regression is quite interesting, this result signifies that for the
given sample assurance has no impact on the total perceived service quality by the
consumer.
 The regression equation contains in Y axis or dependable variable as
“Total experienced service quality” of the consumers and the independent
X axis variables are: Tangibility, reliability, responsiveness, assurance,
empathy qualities as per the consumer response. Now, we will examine
whether there is at all any dependency between the five variables over the
„service quality‟ that the consumers are getting.
 Analysing the result we can infer that except tangibility all the other
attribute have the significance level less than 0.05, so those
attributes have effect on the experienced service quality level.
 The regression equation would be:
 Y =-.388-0.225X1+.231X2+.849X3+ .0X4+.199X5
 Apart from this, within unstandardized coefficients all the B values
of reliability, responsiveness, empathy are greater than standard error
value, along with this tangibility has negative relationship with
perceived quality, which signifies there is a better interdependency
between the Y and X value for reliability, responsiveness, empathy
and also intra data X relations are there. And of course the with 59.4%
reliable model.
Therefore we can conclude that there is direct effect of reliability,
responsiveness, and empathy over the service quality.
Descriptive statistics for the service Gap:

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By Mr.SAMIK DATTA
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3. Analysis of the data collected for the foreign sector banks.
statistics.
Tangibility 3.9532 .76452 31
Reliability 3.9067 .72801 31
Assurance 3.7698 .60012 31
Empathy 3.8257 .64942 31
This gives the statistical analysis of the mean and standard deviation of values of
all the 31 respondents. The Service quality mean is more or less nearer to the
mean of the individual service qualities like tangibility, reliability, responsiveness,
assurance and empathy. Therefore the distribution is evenly distributed. But all
the means are greater than the mean of each attribute for public sector banks and
private sector banks.
 The percentage service quality gap for private sector banks:
Private sector Banks
Mean_ESQ 4.84
Qlty Tangibility 3.95 Gap due to tangibility -0.89
Qlty Reliability 3.91 Gap due to Reliability -0.39

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By Mr.SAMIK DATTA
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Mean
ESQ= Mean Expected service Quality.
consumer.
respondants:
2.00).
Gap due to
Responsiveness
-1.05
Qlty Assurance 3.77 Gap due to tangibility -1.07
Qlty Empathy 3.83 Gap due to Empathy -1.01
Gap due to total
service Qlty
-0.55

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By Mr.SAMIK DATTA
Page 35
Graph: 1
of the respondants:
 Rs.60,001 to Rs. 2,00,000 Per Annum
 Rs. 2,00,001 to Rs. 4,00,000 Per Annum
 Rs. 4,00,001 to Rs. 8,00,000 Per Annum
2.00).
Graph: 2

banks
By Mr.SAMIK DATTA
Page 36
Age Category
Service category
as a percentage of
Age Category
15-25
years
26-40
Years
41-60
Years
Above 60
years
Highly
Satisfied 0.00% 3.23% 3.23% 0.00%
Satisfied 9.68% 29.03% 16.13% 0.00%
Dis-
satisfied 9.68% 22.58% 3.23% 3.23%
Graph1 : The Distribution of satisfied consumer are uniform.Except the salary
range of 4,00,000 to 8,00,000 within all other income categories the frequency of
satisfied people is greater than unsatisfied people. There is no highly satisfied
people dealing with private sector banking.
Graph 2 : The people within the age range 26-40, who are mostly professional
people, they have expericened satisfactory service qulaity and therefore for
public sector banks there is a littele gap between the perceived and expected
quality of service. But conclusion for age range of 41-60 yearsis different, for
these sample of people the service qulaity gap for the strata of people is high.

banks
By Mr.SAMIK DATTA
Page 37
Now, using different hypothesis we will try to draw some inferential or conclusive
decision about the gathered sample and perception about the private banking.
We will use:
• Linear Regression Analysis, for finding out whether there is at all any
dependencies between the dependent variable, i.e. the total experienced or
perceived service quality and the independent variables, all the attribute
qualities.
• MANOVA, to found out the inter dependencies between the independent
attribute variables and the dependent variables.
• Descriptive statistics to identify the mean, median, mode and skewness.
We will start with linear regression model, where the correlation table gives us the
idea about the inter-dependencies between each of the attribute variables.
This table signifies:
 Tangibility and reliability is highly co-related.
 Tangibility and responsiveness is highly co-related.
 Tangibility and Assurance is highly co-related.
 Tangibility and Empathy is highly co-related
 Reliability and responsiveness is highly co-related.
 Reliability and Assurance is highly co-related.
 Reliability and empathy is highly co-related.
 Responsiveness and Assurance is very highly co-related.
 Responsiveness and empathy is highly co-related.
 Assurance and Empathy is highly co-related.

banks
By Mr.SAMIK DATTA
Page 38
And therefore, due to high inter dependency between the variables and the
regression model is not a sound one.
Linear regression model Summary:
Model Summary
Square
Std. Error of the
Estimate
1 .428a
.183 .020 .57954
a. Predictors: (Constant), Empathy, Tangibility, Responsiveness,
Assurance, Reliability
This part gives the information that whatever regression model we are creating
that has 18.3 % reliability. That means with this sample data we can explain 59.6
% of the model.
Therefore, the model of regression is not apt for this sample of data.
ANOVAa
Model Sum of Squares df Mean Square F Sig.
1
Regression 1.882 5 .376 1.121 .375b
Residual 8.397 25 .336
Total 10.279 30
b. Predictors: (Constant), Empathy, Tangibility, Responsiveness, Assurance, Reliablity
Now this result of linear regression is quite interesting, this result signifies that for
the given sample assurance has no impact on the total perceived service quality by
the consumer.
• The regression equation contains in Y axis or dependable variable as
“Total experienced service quality” of the consumers and the independent X axis
variables are: Tangibility, reliability, responsiveness, assurance, empathy qualities
as per the consumer response. Now, we will examine whether there is at all any

banks
By Mr.SAMIK DATTA
Page 39
dependency between the five variables over the „service quality‟ that the
consumers are getting.
analysing the result we can infer that except tangibility all the other
attribute have the significance level less than 0.05, so those attributes have effect
on the experienced service quality level.
the regression equation would be:
Y =-3.065-.138X1 -.437X2-.061X3 -.476X4+1.155X5
Apart from this, within unstandardized coefficients all the B values of
reliability, responsiveness, empathy are greater than standard error value, along
with this tangibility has negative relationship with perceived quality, which
signifies there is a better interdependency between the Y and X value for
reliability, responsiveness, assurance, empathy and also intra data X relations are
there. And of course the with 18.1 % reliable model.
Therefore we can conclude that there is there is no direct effect of tangibility ,
reliability, responsiveness, and empathy over the service quality.

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4. Comparative study of public, private and foreign sectors banks.
Public sector vs Private sector cross tabulation:
Case Processing Summary
Cases
Valid Missing Total
N Percent N Percent N Percent
Public Service
Quality_Categorical *
Private Service
Quality_Category
25 78.1% 7 21.9% 32 100.0%

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Public Service Quality_Categorical * Private Service Quality_Category Crosstabulation
Count
Private Service Quality_Category Total
Bad Service Average Service Good Service
Public Service
Quality_Categorical
Bad Service 3 5 2 10
Medium Service 6 3 4 13
High Service 0 2 0 2
Total 9 10 6 25
Chi-Square Tests
Value df Asymp. Sig. (2-
sided)
Pearson Chi-Square 4.968a
4 .291
Likelihood Ratio 5.742 4 .219
Linear-by-Linear Association .000 1 .987
N of Valid Cases 25
a. 8 cells (88.9%) have expected count less than 5. The minimum expected
count is .48.
The H0 is accepted. The two variables are independent to each other. So the
service quality doesn‟t depend each other.

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By Mr.SAMIK DATTA
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Public sector Bank and Foreign Bank:
Cases
Valid Missing Total
Public Service
Quality_Categorical *
Foreign Service
Quality_Category
31 96.9% 1 3.1% 32 100.0%
Public Service Quality_Categorical * Foreign Service Quality_Category Crosstabulation
Count
Foreign Service Quality_Category Total
Bad service Average Service Good Service
Public Service
Quality_Categorical
Bad Service 1 6 4 11
Medium Service 2 6 10 18
High Service 0 1 1 2
Total 3 13 15 31
Chi-Square Tests
sided)
4 .823
Linear-by-Linear
Association
.476 1 .490
N of Valid Cases 31

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By Mr.SAMIK DATTA
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Private Sector Bank Vs. Foreign Banks
Cases
Valid Missing Total
Private Service
Quality_Category * Foreign
Service Quality_Category
25 78.1% 7 21.9% 32 100.0%
Private Service Quality_Category * Foreign Service Quality_Category Crosstabulation
Foreign Service Quality_Category Total
Bad service Average Service Good Service
Private Service
Quality_Category
Bad Service 1 3 5 9
Average Service 1 4 5 10
Good Service 1 4 1 6
Total 3 11 11 25

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By Mr.SAMIK DATTA
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Chi-Square Tests
sided)
4 .646
Linear-by-Linear Association 1.324 1 .250
N of Valid Cases 25
a. 9 cells (100.0%) have expected count less than 5. The minimum
expected count is .72.
Recommendations and Conclusions:
The conclusion is, as per the sample surveyed the public sector satisfaction is in
optimum level, although they are most reliable. Whereas the service quality of the
private sector mostly depends upon the reliability, responsiveness and apathy,
where tangibility is there main USP. For the case of foreign banks all these
attribute has no direct effect on the service quality.
Recommendation to public sector bank, sometimes the look and feel attracts the
consumers more, specifically the generation within age group 15-40, who are
actually the main revenue generating consumers.
Recommendation to private sector bank, they have to concentrate on the factors
of gaining more and more reliability, by providing the promised services.

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By Mr.SAMIK DATTA
Page 45
Further scope of extensive research:
With the content of this research we can further more involve in researching the
specific service gap for individual banks. The SWOT analysis of the three clusters
of banks. What are the challenges foreign banks are facing while penetrating
Indian Banking Industry.
Bibliography:
My Special Thanks to:
Dr. Philip Kotlar, book : Marketing Management.
Das and Maholtra, Marketing Research
C.R.Kothari, Research Methodology.
AppaRao, Business Process and Strategic Analysis.
Apart from this I have referred some of the content of :
http://www.skoool.ie/
http://www.slideshare.net/sreekuttyms/nationalised-in-india
http://en.wikipedia.org/wiki?curid=5413
http://www.wbiworldconpro.com/
http://info.shine.com/industry/
https://www.equitymaster.com/research-it/
Appendix:
Requisite documents:
No requisite document is added
Questionnaire:
Added
Response Sheets:
In soft copy.
Important Table used for calculations:

To Identify Service Qulaity Gaps in Banking Sector in India

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