| Contents TOPIC : “STUDY OF HDFC BANK CREDIT CARDS TOWARDS CUSTOMER”1 1. Context /Background3 2. Summary and literature review4 3. Questions and hypotheses and justification6 4. Summary of method7 4. 1:Research instruments7 5. Ethics and Safety Requirements8 6. Limitations9 7. Implications10 8. Research Timetable11 9. References12 STUDY OF HDFC BANK CREDIT CARDS TOWARDS CUSTOMER 1. Context /Background Housing Development Finance Corporation Bank of India was incorporated in the year in August 1994 after the changes that were made by Reserve Bank of India, which is by allowing for the establishment of private sector banks in India.
This is an assignment made on the sales of the bank credit cards because this is a vast subject that is to be studied in a country like India. India is a large country with diversities, so the customer interaction with be different in each and every place, that may be the language, environmental factors etc. According to my study I would like to suggest that the industries go through narrow phases like introduction, growth, maturity and declines. But these may vary from one place to another comparatively on interceptions and interpretations. In India there a various banks like public sector and private sector banks.
And today the private sector banks are giving a tough fight for the public sector banks so called government banks. So considering all these factors I would like to discuss the topic credit cards of HDFC Bank Ltd because there is a tough competition and in this competitive situation how the customers can be satisfied with the bank. In today’s world of competition customer is the supreme for the bank so customer service and customer satisfaction are the main areas were the concentration is to be made. HDFC Bank ltd has got various types of credit cards for different consumers.
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It has made a very good market catching plan by introducing different types of cards to different types of customers like for working class, business class and special cards for women. The different types of cards that they have introduced are like Gold Credit Card, Women’s Gold Credit Card, Business Gold Credit Card, Titanium Credit Card, Business Platinum Card, Platinum Chip Credit Card all these are regular card and there are premium cards like World Master Credit Card, Visa Signature Credit Card and also there are Super Premium cards like Infinia and Regalia cards.
All the above mentioned cards are of different credit limit. All these cards are given to the consumers according to their bank transactions ant measured value of customers according to their efficiency so all types of customer get the privilege of using credit card. In India use of credit card is a privilege. So the HDFC Bank ltd aiming this point of view of customers they have satisfied the needs of customers according to the customer wants. In my study ill will show about the HDFC Bank and their role towards customers. 2. Summary and literature review
I will be showing in this study of HDFC Credit Card towards customers as they have many positive and few negative things towards the usage of credit card. There are three factors of customers that i have taken into consideration that is satisfaction of customer, security and payment default of customer. In this study I have a personal experience with the sales of HDFC Credit Cards so that I know what the customer prefer what are their needs, i have a basic practical research on this. And also in my study i have done a review of different people what is their opinion about credit card towards customers.
There is a lot of study made by various people in the literature review and tried to prove various points like why people start using credit cards by Berthoud and Kempson in 1992, Lea, Webly and Levine in 1993, Lea, Webly and Walker in 1995, Livingstone and Lunt in1992, Tokunaga in 1993, Kaynak and Harcar in 2001. all these people have made an enormous ways of study in credit and customers. In one of the study referred in that Tokunaga in 1993 tried to prove himself by getting involved in profile individuals who are using credit cards and also the related problems of it faced by the customers.
He made a detail study that whether the consumers are able to use or not efficient to use consumer credit card effectively and in his theory he made a research on consumer behaviour, psychology and substance abuse. He came to know from the study that abortive users appeared to have more external locus of control, lower self efficiency, considered money as a spring of power and prestige. Cox and Jappelli in 1993 initiated that the demand of credit card positively related to permanent earnings and net worth and negatively related to income and age.
Duca and Rosenthal in 1993 in their search recognizes that the credit demand of young households is positively related to wealth, income and household size. Calem and Mester in 1995 in their study they investigated the circumstances of the people whether they have the efficiency of paying their credit card debts and they recognized that the card holders with a very high unpaid due or debts had a higher probability of payment default. One of the study made by Ankara Chamber of Commerce (ATO) in this study unimpeded that “what the consumers says for the credit cards? ,it was designed to find that the number credit card a holder having, the interest rates, amount of the card debts of the consumers, expenses that have been made by the credit card and the problems that have been caused by the use of credit cards. Slocum and Mathews in 1970 made a test that whether social class and income class can be considered as indicators of consumer behaviour by using the data that is obtained from nearly 2,032 commercial bank credit card holders in USA.
In their study they observed that people of various segments gave their views as different credit card using patterns, and they found that the social class is not the most useful market segmentation variable for the credit card behaviour of consumers and came to a conclusion that the income level is better indicator of consumer card behaviour than social class. Again in 1969 Mathews and Slocum in their study found that the card holders who have low income and socio economic status used credit cards to spawn revolving credit more habitually than the affluent and elevated class card holders.
Ankara Chamber of Commerce says that according to their survey results that 70. 6% of the card holders will be using more than one credit card, 50. 3% of the people have the difficulty in the payment of credit card bills, 24. 2%of the people paid their all debts every month and 25% of the people did not even bother of repaying the amount. According to the Novilities et al of 2003 there are inconsistent conclusions in the literature about the effect of psychological factors cause a creation of debt.
Some of the studies come to a conclusion that people with outsized amount of personal debt are not demographically different from others. For instance, Livingston and Lunt in 1992 instituted that the debt is common among individuals with high income and less children. In 1993 Lea et al. studied that the serious debtors are varied from the non-debtors in terms of sociological, economical and psychological variables and gentle debtors are generally intermediate between the two.
Ausubal in 1997 and Domowitz and Sartain in 1999 instituted that there is a positive relationship between credit cards and personal bankruptcy. Warren-Tyagi in 2003 in his study he says that credit cards provide temporary opportunities for the people to continue their life values when their income is not sufficient. It is like they want to go above their limits to get the needs that are not necessary. In one of the study made by Ahuja G and Singh in 2006, according to them the perceptions of nearly 160 customers of a place in usage of credit cards especially their growth of India.
They say that 2/3rd of males and 1/3rd females use credit cards. People of age 40-50 years are the people who make more usage. Majority of the card holders are business man or serviceman. The whole study says that the bank should try to give equivalent attention to female consumers with some special offers and benefits. According to Saha p and Zhao Y in 2005 they analyzed that the relationship between service and customer satisfaction in credit cards are mainly of five service dimensions selected by them.
Their survey says that efficiency, reliability, responsiveness, fulfilment, privacy, communication, personalization, technology update are the main factors for the customers. These have a strong impact on customer satisfaction. Here in above instances we are aware of different people given different interpretations, ideas, views regarding credit cards. Here in my study I have taken three major factors into consideration that is satisfaction of the customer, payment default of the customer and the security of the credit card.
Satisfaction of customers is how the customers are going to be satisfied with the product which is given by the bank. Paymentdefault is a major problem for the bank and also the customers the study is also made on this as key factor and security which each and every customer are find that as a very important factor because they require safety for their money and the credit card which may cause for the misappropriation of the account if lost or mishandled. All these factors are also studied with hypothesis below. 3. Questions and hypotheses and justification
Questions 1. RQ1: Does the customer’s satisfaction affect credit cards? 2. RQ2: Is there any payment default? 3. RQ3: Do the customers have security for their credit card? SATISFACTION RQ 1 PAYMENT DEFAULT RQ 2 HDFC CREDIT CARDS RQ 3 SECURITY RQ1: HDFC Bank is a customer friendly bank and it try to have a good relationship with the customers by giving good service RQ2: Bank sees that there will be no more payment default and so that it will help the customer and the customer will have satisfaction with the service of the Bank.
RQ3:Bank gives security to each and every customer of the bank it is like the credit customer credit card is the credit card of the bank so that it will be taken care of it so that there will be no misappropriation. 4. Summary of method In my study i can say that the customer’s attitude towards HDFC Bank credit card services was eloquent in nature. According to my secondary data study collected by me I would like to say that regarding the satisfaction, customer default and security collected the data feedback from the people to whom I have issued credit cards and use to have a discussion with them about the usage of the card.
This was done in order to fully understand the existing banking scenario of the banking services. Firstly regarding satisfaction of customer is yes most of the customers preferably the working class like the customers who work in companies and the companies will have tie up with the bank, in that the companies are graded and according to the grade of the company, the type of credit which the customer require will be given. So the customers of this kind are preferably more in the bank avoiding to my observance so these customers have good satisfaction.
But there are instances where customers are not having a great satisfaction with the bank credit card. This is because of some there is some mishandling with the customers because they don’t use the credit card as per the guidelines, rules and regulations given by the bank. Even bank has got some drawbacks because the credit card is been sold out by the credit card sales representatives, so these so representatives don’t explain the customer systematically in a eager that they got a customer and the representatives will be in the only view of completing their target with the given data.
I have made few discussions with customers to whom i have issued to get the feedback of the service given by the Bank and by myself. 4. 1:Research instruments Discussion: Direct discussion with the customer when he visited the bank for the payment of the credit card bill or by a telephone call after the credit card is issued. Geographical coverage: This study is taken on the customers of HDFC Bank customers. And the customers were from various places who had come for the sake of job.
Place where I made my study is in India, Karnataka state, Mangalore. In my study i also found about the payment default of the customers due to various reasons that is; Late payment: This is a major mistake what the employees do, as soon as they get the bill they keep aside then forget to pay or just neglect it and due to this the bank will levy high charges because of the due of the bill. Then the customers start blaming the bank that the bank has unnecessarily levied high charges.
Unwanted swiping: Customers once they get a credit card first they start is swiping everywhere for things which not required and the bank put sur charges for the swipes made which the customers some time won’t be aware of that then later the customer will blame the bank. So the bank has taken some precautions for this by giving some facilities like regular messages to the mobile phone, mailing the customer and also the customer can enquire through customer care centre. Security Customers in India are very careful when their using such kind of facility.
They will be having lot of enquiries regarding the usage of credit card. They also prefer the card to be secured sop that if lost also any one should not be able to misuse it. So the banks give a pin or a security code to the customer and also insurance facility with the credit card. And if the card is lost and misused by any one the customer will get an alert on his cell or to his mail saying that the card is being swiped. So that he will come to know that if he is using or someone else if using. 5. Ethics and Safety Requirements:
While conducting my research i have taken into consideration that some kind of ethics and safety requirements are followed that are necessary. All the data which I have collected and presented is authentic one. All the research methods which have done is where other researchers have done in their study and I am going to use the method which the research’s have used in their early research study. Some of the ethics to be followed are: Understand would like to make the reader understand what is the research is made on. I have used the language in the way that is simple so that any reader can understand and find it easy.
Disclosure: All the data which has been given in this research will have full authenticity. All the data and all the information given will be disclosed despite of being positive or negative in nature. Think about the data when the research is yet to begin would be unethical if the data used is not proper in nature. To avoid this data will be re analysed before the study begins so that there will be a proper, supportive good data disclosed. Limits of internet: it would be unethical if the data that is applied in the research made by me would be abstracted directly from the internet and disclosed.
All the literature and the data will be disclosed taken from internet and checking its authentication and researcher who has done before as the primary research. 6. Limitations 1. The study which i have made on is restricted to the customers of the place Mangalore and it was only about the bank which I was working. 2. There was a lack of co-operation from the customer’s side to give the required information to know or get back the feedback of the customer. 3. The study was restricted to only Mangalore. Hence caution need to be exercised in generalizing the results of the study. 4.
The availability of time to carry out an overall exhaustive study was not enough to gather the complete scenario. 5. In between the work load of the bank the study was conducted so factors may be missed out. 6. There is still study to made on this but due to the time shortage only few things are taken into consideration in my study 7. In some instances the customers are satisfied with the HDFC Bank and the services but in some cases customers are not satisfied with some factors. 8. Only around 50 % of the customers are satisfied with the interest rate on credit card purchase.
Most of them believe that the researcher must be enthusiastic to provide some variety of compensation or benefits on the respond because interaction has sacrificed time and may even incur transportation cost to participate in the collection of data. Such responses should be restricted only to the non-financial such as the sharing of the data collection, results etc. 7. Implications The outcome of this research will let us know the customers if the bank better and the customer will come to know about some of the basic things of the bank credit cards.
From this study I would prefer to say that the HDFC Bank should concentrate on the study of the customer card department of HDFC Bank and the credit card section should be in a position to direct the customers in all transactions and credit card queries. There should be a quick processing of the applications when an applicant is applied for credit card. There should be security for the credit cards that which has got a advanced technology so there no chance of misappropriation without the knowledge of the customer.
The surcharge and other hidden charges that the bank will be charging on the customer should be informed properly to the customers. The message of the bill should be reached to the customers in time and the bank should keep a good friendly relationship with the customer and suggest the customer to pay the bill in time and also try to convince the customer if there is any pending of the bill to make the payment but convincing the customer in a very polite systematic way that the customer is satisfied with bank and do the payment which will be helpful for the customer as well as the bank.
The sales representatives should give a clear picture or idea to their customers about the credit card services and all the queries. The research is based on the study made in a place called Mangalore of only one branch of the bank. Thought there are certain limitations feel that justice has been made to the subject and an attempt is made to present an overall picture about the banking experience in HDFC Bank. By conducting this study i would feel that the Bank may go for further improvements in the credit card section in their upcoming days so that it will be favourable to the customers and the bank.
The success of the bank depends on the extent to which they are able to sustain the competitive advantages. The bank should also do such kind of studies so that it will come to know the customers wants and needs. 8. Research Timetable TIME FRAME| MILESTONE| | | 20 JUNE 2012| Selection of assignment topic| 22 JUNE 2012| Enquire with the supervisor can the study be done or not| 25 JUNE 2012| Start with the topic| 26 JUNE 2012 to 27 JUNE| Context| 28 JUNE 2012| Summary of literature review| 9 JUNE 2012| Questions and hypotheses and justification| 30 JUNE 2012| Summary of the method, ethics and safety requirements, limitations| 1 JULY 2012| Implications| 9. References Mehta, Subhash, “India Consumer Behaviour, Studies and case for Marketing Divisions”, 1997 Tata McGraw Hill Publishing Co. , Ltd. , New Delhi. Kotari C. R, “Research Methodology” Wiley Eastern Ltd. , New Delhi Jean Pierre Jeannet, Hubbert D. Hannessey, “Global Marketing Strategies”, 2nd edition, Jaico Publishing House, New Delhi, 1999. Journals,publications,magazines and websites
Survey of India Industry 2005, The Hindu. Goyal, A. 2004. Role of Supplementary Services in the Purchase of Credit Card Services in India. Asia Pacific Journal of Marketing and Logistics, 16(4): 36 Lee, J. , & Kwon, K. -N. 2002. Consumers' use of credit cards: Store credit card usage as an alternative payment and financing medium. The Journal of Consumer Affairs, 36(2): 239. Sulaiti, K. A. , Ahmed, Z. U. , ; Beldona, S. 2006. Arab Consumers' Behavior Towards Credit Card Usage: A Comparative Analysis of Consumers Across Middle Eastern Countries. Journal of T Adcock, W.
O. , E. C. Hirschman and J. C. Goldstucker (1977). “Bank credit card users: an updated profile” Advances in Consumer Research, Vol. 4, pp. 236-241ransnational Management, 12(1): 65 Ausubel, L,M. (1997), “Credit card default, credit card profits and bankruptcy”, American Bankruptcy Law Journal, Vol. 71, pp. 249-270 Dunn, L. F. and Kim, T. H. (1999), An empirical investigation of credit card default, Working Paper, Ohio State University www. www. sebi. gov. in/dep/dcbdraft. pdf ezineartticles. com/online-credit-card-payment-service-HDFC-Anyone? &id=6907353 ttp://article. wn. com/view/2012/07/01/HDFC_Bank_aims_one_million_new_credit_cards_in_201213/ Credit Card Research Group (2001), Statistical Yearbook, Credit Card Research Group, London. Mackintosh, J (2001), The Financial Times, pp. 4. Horne, S, Worthington, S. (1999), "The affinity credit card relationship: can it really be mutually be Worthington, S (1999), "The plastic card and its role in customer relationship management", Customer Relationship Management, Vol. 1 No. 3, pp. 199-20. neficial? ", Journal of Marketing Management, Vol. 15 No. 7, pp. 603-1 ***
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