A

PROJECT REPORT

ON

THE STUDY OF SERVICE QUAITY OF HDFC BANK

BACHELOR OF BUSINESS ADMINSTATION

SESSION 2014-2017

SUPERVISED BY: SUBMITTED BY:

STUDENT DECLARATION
I Robin Handa bearing university roll number 5114VBFG430032 hereby declare that I have
done the project report on the topic ‘TO STUDY THE SERVICE QUALITY OF HDFC
BANK AT SOLAN’ which is submitted in partial fulfilment of requirement of the award of
degree of BACHELOR OF BUSINESS ADMINISTRATION of Himachal Pradesh
University Shimla, and the data that is included in it is original. The assistance and help that
received during the course of this study has been duly acknowledged. It is further, declare
that is an original piece of work and it is worthy of the consideration for the degree of BBA.
 ACKNOWLEDGEMENT

This project report is the culmination of several weeks of efforts. It is the combination of
ideas, suggestions and contribution of many minds. It is with a deepest sense of gratitude that
I reiterate my indebtedness to my guide Mrs. KHUSHBOO GOYAL for her valuable
guidance, constant encouragement and constructive criticism during the course of my study.
INTRODUCTION OF THE TOPIC
The housing development finance corporation limited (HDFC) was almost 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 liberalisation 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 operation as a Schedule Commercial Bank in
January 1995.

HDFC Bank comprise of a dynamic and enthusiastic team determined to accomplish the
vision of becoming a World-class Indian Bank. HDFC Bank’s business philosophy is based
on our four core values i.e.

1. Customer Focus
2. Operational Excellence
3. Product Leadership and
 4. People

They believe that the ultimate identity and success of their bank will reside in the exceptional
quality of people and their extraordinary efforts. They are committed to;

1. Hiring
2. Developing
3. Motivating and
4. Retaining the best people in the industry.

BUSINESS FOCUS
HDFC Bank’s mission is to be a world class Indian bank. The objective is to built sound
customer franchises across distinct businesses so as to be the preferred provider of banking
services for target retail and wholesale customer segments, and to achieve healthy growth in
profitability, consistent with the bank’s appetite. The bank is committed to maintain the
highest level of ethical standards, professional integrity, corporate governance and regulatory
compliance. HDFC Bank’s business philosophy is based on four core values- operational
excellence, customer focus, product leadership and people.

MANAGEMENT
Mr. C.M. Vasusdev has been appointed as the chairman of the bank with effect from 6th July
2010 subject to the approval of the reserve bank of India and the shareholders. Mr. Vasudev
has been a director of the bank since October 2006. A retired IAS officer, Mr. Vasudev has
had an illustrious career in the civil services and has held several keys position in India and
overseas, including finance secretary, government of India, executive director, World Bank
and government nominee on the board of many companies in the financial sector.

The managing director, Mr. Aditya puri, has been a professional banker for over 25 years,
before joining HDFC Bank in 1994 was heading Citibank’s operation in Malaysia

The bank’s board of director is composed of eminent individuals with a wealth in experience
in public policy, administration, industry and commercial banking. Senior executives
representing HDFC are also on the board.

Senior banking professionals with substantial experience in India and abroad head various
businesses and functions and report to managing director. The bank believes that its people
are a significant competitive strength.

TECHNOLOGY
HDFC Bank operates in a highly automated environment in terms of information technology
and communication systems. All the bank’s branches have online connectivity, which enables
the bank to offer speedy funds transfer facilities to its customers. Multi branch access is also
provided to retail customer through the branch network and automated teller (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 is supported by scalable and robust system which ensures that our clients always get
the first service we offer.

The bank has prioritised its engagement in technology and the internet as one of its key goal
and has already made significant progress in web-enabling its core business.

MISSION STATEMENT OF HDFC BANK

1. World class Indian bank
2. Benchmarking against international standards
3. To built sound customer franchises across distinct businesses
4. Beat practices in terms of product offering, technology, service audit and compliance.

VISION STATEMENT OF HDFC BANK

The HDFC Bank is committed to maintain the highest level of ethical standards, professional
integrity and regulatory compliance. HDFC Bank’s business philosophy is based on four core
values such as;

1. Operational Excellence
2. Customer Focus
 3. Product Leadership
4. People

The objective of the HDFC Bank is to provide its target market customer a full range of
financial products and banking services, giving the customer a one step window for all
his/her requirements. The HDFC Bank plus and the investment advisory services programs
have been designed keeping in mind need of customer who seeks distinct financial solutions,
information and advice on various investment avenues.

BUSINESS
HDFC Banks offers a wide range of commercial transactional banking services and treasury
products to wholesale and retail customers. The bank has three key business segments.

WHOLESALE BANKING SERVICES- The bank’s target market ranges from large blue
ship manufacturing companies in the Indian corporate to small and mid-sized corporate and
anti-based businesses. 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 leading provider of structured
solution, which combine cash management services with vendor and distributor finance for
facilitating 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 house and prime
public sector companies. It is recognised as a leading provider of cash management and
transactional banking solutions to corporate customer, mutual funds, stock exchange
members and banks.

BUSINESS STRATEGY
1. Increasing market share in India’s expanding banking
2. Delivering high quality customer services
3. Maintain current high standards for assets quality through disciplined credit risk
management
4. Develop innovative products and services that attract target customer and address
inefficiencies in the Indian financial sector.
DISTRIBUTION NETWORK
HDFC Bank is headquartered in Mumbai. The bank at present have a enviable network over
1229 branches spread over 444 cities across India. All branches is linked on an online real
time basis. Customers in over 120 locations are also serviced through telephone banking. The
bank’s expansion plans take into account the need to have a presence in all major industrial
and commercial centres where its corporate customers are located as well as the need to built
a strong retail customer base for both deposit and loan products. Being a clearing/settlement
bank to various leading stock exchange, the bank has branches in the centres where the
NSE/BSE has a strong and active member base.

The bank also has a network of about over 2526 networked ATMs across these cities.
Moreover, HDFC Bank’s ATM network can be accessed by all domestic and international
visa/master card, visa electron/maestro, plus/cirrus and American express credit/charge
cardholders.

PROMOTER
HDFC Bank’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 a, market leader in
mortgagees. Its outstanding loan portfolio covers well over a million dwelling units. HDFC
has developed a significant expertise in retail mortgage loan to different market segments and
also has a large corporate client base for its housing related facilities. With its experience in
the financial franchise, HDFC was ideally positioned to promote a bank in the Indian
environment.

CSR activities

HDFC Bank has taken several steps as a part of their Corporate Social Responsibility. It has
collaborated with several NGOs to assist in its activities.

Initiative Objective Activities

Sustainable Provide
Conducts training for occupational skills, credit
Livelihood empowerment to the
counselling, capacity building program, sustainable
rural section of the
 country, especially livelihood initiative
women.

Financial literacy in
Financial 600 schools across Rural financial literacy programs under the aegis of
Literacy Andhra Pradesh and RBI.
Odisha.

Friends Union for Energising Lives (FUEL), cover

100 children under Jayaprakash Narayan Memorial
Aim to making every
Trust’s Vidya and Child Programme. Supported a
Education child literate with
girl’s project named Basera E Tabassum (BeT) run
quality education.
by Borderless World Foundation especially for the
orphan girls who lost parents in violence.

Aimed at formal
training and ETASHA, support SGBS Trust, tied up with Hope
Training
development of Foundation
youth

Focused on
Partnered with Watershed Organisation Trust
Community sustainable
(WOTR), promote rain water harvesting, blood
Initiatives development with
donation campaigns
economic growth

QUALITY POLICY
1. SECURITY- The bank provides the long term financial security to their policy. The
bank does this by offering life insurance and pension products.

2. TRUST – The bank appreciates the trust places by their policy holder in the bank.
Hence, it will aim to manage their investment very carefully and live up to this trust.

3. INNOVATION – Recognizing the different needs of our customers, the bank offer a
range of innovative products to meet these needs.
 4. INTEGRITY

5. CUSTOMER CENTRIC

6. PEOPLE CARE “ONE FOR ALL AND ALL FOR ONE”

7. TEAM WORK

8. JOY AND SIMPLICITY

SERVICE QUALITY IN BANKS

Service quality has been defined by various experts in various ways as: ‘service quality is the
difference between customers’ expectation foe service performance prior to the service
encounter and their perceptions of the service received. According to Gefan, service quality is
the subjective comparison that customer make between the quality of service that they want
to receive and what they actually get. Parasuraman says, service quality is determined by the
difference between customer’s expectation of services provider’s performance and their
evaluation of services the received. Service quality is the delivery of excellence or superior
service related to customer expectations. Service quality is recognized as a multidimensional
construct. While the number of dimensions often various from researcher to researcher, there
is some consensus that service quality consists of three primary aspects: outcome quality,
interaction quality and physical service environment quality.

Outcome quality refers to the customer assessment of the core service which is the prime
motivating factor for obtaining the services.

Interaction quality refers to the customer assessment of the service delivery process, which is
typically rendered via a physical interface between the service provider, in person, or via
technical equipments and the customers.

The physical service environment quality dimension refers to customer’s evaluation of any
tangible aspects associated with the facilities or equipments that the service provider in/with.
It includes, for example, the physical condition of an ATM machine.

DIMENSIONS OF SERVICE QUALITY

RESPONSIVENESS

TANGIBILTY REALIBILITY
 EMPATHY ASSURANCE

DIMENSIONS OF SERVICEQUALITY

1. RESPONSIVENESS- Customer expects that the bank must respond their inquiry
promptly. Responsiveness describes how often a bank voluntarily provides services
that are important to its customers. Researcher examining the responsiveness of
banking services has highlighted the importance of perceived service quality and
customer satisfaction.

2. TANGIBILITY- This dimension deals with modern looking equipments and visual
appealing part of banks.

3. REALIBILITY- This dimension has a direct positive effect on perceived service

quality and customer satisfaction n banking institution. Bank must provide error free
service and secure online transactions to make customer feel comfortable.

4. ASSURANCE- Customer expects that the bank must be secured and the behaviour of
the employees must be encouraging.

5. EMPATHY- Individual attention, customised service and convenient banking hours

are very much important in today’s service.

RESEARCH OBJECTIVE AND RESEARCH METHODOLOGY

RESEARCH OBJECTIVES

The objectives of the study are as follows:

1. To examine the essential dimension of service quality i.e. RATER- Reliability,

Assurance, Tangible, Empathy and Responsiveness of HDFC Bank and its effects on
customer’s satisfaction.

2. To find out the level of perception of the customers from the service quality offered
by the bank.

3. To know which service quality dimension of the bank is performing well.

 4. To identify which dimension of service quality needs improvements so that the
quality of service of HDFC Bank is enhanced.

IMPORTANCE AND SCOPE OF THE STUDY

The study would try to throw some insight into the existing services provided by the bank,
perception and the actual service quality of the bank. The result of the study would be able to
recognise the lacunae in the system and thus provided key areas where improvements is
required for better performance and success ratio. In the days of intense competition, superior
service is the only differentiator left before the banks to attracts, retain and partner with the
customers. Superior service quality enables a form to differentiates itself from its
competition, gain a sustainable competitive advantage, and enhance efficiency.

SCOPE OF THE STUDY

The scope of the study is to identify the service quality of HDFC Bank. This research is based
on primary data and secondary data. This study only focuses on the dimension of service
quality i.e. RATER. It aims to understand the skill of the company in the area of service
quality that are performing well and shows those areas which require improvements. The
study is done taking two branches of HDFC bank into consideration.

RESEARCH METHODOLOGY
DATA SOURCE

PRIMARY DATA-

The primary data was collected by means of a survey. Questionnaires were prepared and
customers of the banks at two branches were approached to fill up the questionnaires. The
questionnaire contains 20 questions which reflect on the type and quality of the service
provided by the bank to the customers. The response of the customers is recorded on a grade
scale of strongly disagree, disagree, uncertain, agree and strongly agree for each question.
The filled up information was later analyzed to obtain the required interpretation and the
findings.

SECONDARY DATA-
In order to have proper understanding of the service quality of the bank a depth study was
done from the various sources such as books, a lot of data also collected from the official
website of the bank and the articles from various search engines like Google, yahoo search
and answer.com.

RESEARCH DESIGN-

The research design is exploratory till identification of service quality parameters. Later it
becomes descriptive when it comes to evaluating customer perception of service quality of
the banks.

Descriptive research also known as statistical research describes data and characteristics
about the population or phenomenon being studied.

Descriptive research answer the question who, what, where, when and how.

Although the data description is actual, accurate and systematic, the research cannot describe
what caused a situation. Thus, descriptive research cannot be used to create a casual
relationship, where one variable affects another. In other words, descriptive research can be
said to have a low requirements for internal validity.

The description is used for frequencies, average and other statistical calculations. Often the
best approach prior to writing descriptive research is to conduct a survey investigation.
Qualitative research often the aim of description and researchers may follow-up with
examination of why the observation exists and what the implications of the findings are.

RESEARCH SAMPLE
SAMPLING PLAN-

Sample is not possible to study whole universe, it becomes necessary to take sample from the
universe to know about its characteristics.

1. Sampling units : customers of HDFC bank

2. Sample technique : random sampling

3. Research instruments : structure questionnaire

4. Contact method: personal interview

SAMPLE SIZE-

1. The work is case of HDFC bank, one of the largest banks of Indian banking industry
together representing over 25 percent of the market space of Indian banking space.
The survey was conducted in the city of soaln with two branches of HDFC Bank, with
50 customers as respondent.

DATA COLLECTION TOOLS

1. Strongly disagree

2. Disagree

3. Neither agree nor disagree

4. Strongly agree

Likert scaling is a bipolar scaling method, measuring either positive or negative response to a
statement. The questionnaires contain two parts. The first part consists of question concerning
the demographic information of the respondent such as the name, age, education qualification
and income. The second part consisting of 18 questions exploring the respondent’s perception
about the service quality of the HDFC Bank. For evaluation of service quality of HDFC Bank
service quality dimension of reliability, assurance, tangibility, empathy and responsiveness is
used in order to evaluate the actual service quality of HDFC Bank.

LIMITATIONS OF THE STRATEGY

1. The study is only for the HDFC bank confined to a particular location and a very
small sample of respondent. Hence the findings cannot be treated as representative of
entire banking industry.

2. The study can also not be recognized for public and private sector banks of the
country.

3. Respondent can give biased answers for the required data. Some of the respondent did
not like to respond.

4. Respondent try to escape some statement by simply ‘neither agree nor disagree’ to
most of the statements. This was one of the most important limitations faced, as it was
difficult to analyze and come at a right conclusion.
5. In this study, included 50 customers of bank because of time limit.