RESEARCH PROJECT REPORT

On

“A STUDY ON CUSTOMER PREFERENCE

Guided By: Submitted by:

Session 2022-2023
School of Management
Babu Banarasi Das University
Sector I, Dr. Akhilesh Das Nagar, Faizabad Road, Lucknow (U.P.) India
PLAGIARISM CERTIFICATE
 DECLARATION

This is to declare that I, DEEPAK DUBEY (University Roll No.1210672102)

student of MBA, have personally worked on the project entitled “A STUDY ON

CUSTOMER PREFERENCE TOWARDS FINANCIAL SERVICES OF

PUBLIC AND PRIVATE SECTOR BANKS - A COMPARATIVE STUDY”.

The data mentioned in this report were obtained during genuine work done and

collected by me. The data or information obtained from primary (first-hand sources)

and any other alternative sources are absolutely acknowledged. The result and

analysis embodied during this project has not been submitted to the other University

or Institute for the award of any degree.

DEEPAK DUBEY
ROLL NO.1210672102
MBA 4th Semester
BBD UNIVERSITY, LUCKNOW
 ACKNOWLEDGEMENT

First and foremost am indebted to the Almighty. It provides Pine Tree State immense

pleasure to position on record my feeling and reverence to my guide and supervising

faculty Mr. Rajat Krishna Lal from Babu Banarasi Das University, Lucknow for

all the timely help and support rendered. But for her constant motivation,

encouragement and adept guidance during the entire course of research, my endeavor

would not have culminated in fruition. The sincerity and dedication put in by her for

the sake of my Research Report is remarkable. I would like to thank her for the

opportunity I was given to conduct my Research and further my Research Report

under his guidance. I am grateful to Prof. (Dr.) Sushil Pande, the Dean/Incharge -

SOM of Babu Banarasi Das University, Lucknow for sparing his valuable time for

me on different occasions. I really appreciate all the bank employees who provided

the requisite data for my research work. It was their cooperation and input that made

this research possible. I express my gratitude to all the library staff of Babu Banarasi

Das University, Lucknow. Close to my heart is the support of my dear Colleagues,

family and friends. They were always there for me with their wise counsel and

sympathetic ear. I could not have done any of this without you all. Thank you once

again.

DEEPAK DUBEY
ROLL NO.1210672102
MBA 4th Semester
BBD UNIVERSITY, LUCKNOW
                                                           
 PREFACE

It was a privilege for me to work in a reputed organization. This has given us an

opportunity to work in a truly professional environment where team work score over

individual effort, where there is a helpful atmosphere. A well planned, properly

executed and evaluated training helps a lot in inoculating good work culture. The

project on “A STUDY ON CUSTOMER PREFERENCE TOWARDS

FINANCIAL SERVICES OF PUBLIC AND PRIVATE SECTOR BANKS - A

COMPARATIVE STUDY” has been made to facilitate effective understanding

about the marketing aspects. The project research has provided me an opportunity to

gain practical experience, which has helped me to increase my sphere of knowledge to

a greater extent. I have tried to summarize all our experience and knowledge acquired

up till now, in this report. This project is a keen effort to obtain the expected results

and fulfill all the information required. At the end annexure and bibliography are

given for effective understanding

This project report is prepared as the partial fulfillment of two year degree programme

of MBA curriculum of Babu Banarasi Das University, Lucknow. This Research

project is a compulsory part of the academics. This research is done in the fourth

semester of the MBA program.

Today employees expect quality of work life, more than financial benefits from the

organization. With the advent of new technologies, factors related to mental health in

Tata Motors Limited are taken into consideration more than ever. Studies have

revealed that one of the factors affecting the productivity of employees in an

organization is quality of work life. Another influential factor is job satisfaction which

is important in the improvement of work environment conditions and organizational

efficiency. Quality of work life is an experience which an employee feels about the

job and work place in organization. The purpose of this paper is to identify the

relationship between two variables like, quality of work life and job satisfaction. The

study is an attempt to explore the better understanding of quality of work life and

employee job satisfaction in Tata Motors Limited. Findings of the study will help the

management and employees of Tata Motors Limited to understand the level of quality

of work life of Tata Motors Limited employees.

The project is followed by 8 Chapters.

Chapter 1: Definition & concept of Employees Satisfaction and Quality of Work

Life at Tata Motors Limited

Chapter 2: Literature Review and Company Profile

Chapter 3: Research methodology, objective of research.

Chapter 4: Analysis & interpretation of collect data’s.

Chapter 5: Findings
Chapter 6: Suggestions & conclusions

Chapter 7: References

Chapter 8: Annexure

This report is an honest work towards the topic. There can be many short comings in

it because of the lack of the time, unavailability of data and other constraints.
 TABLE OF CONTENT

S. No Particular Page No.

1 Bona-fide Certificate of Dean -School of Management i

2 Plagiarism Certificate ii

3 Declaration iii

4 Acknowledgment iv

5 Executive Summary v

6 Introduction 1

7 Company Profile 12

8 Literature Review 27

9 Objective of the Study 37

10 Research Methodology 39

11 Data Analysis and Interpretation 43

12 Findings 64

13 Limitations of The Study 66

14 Suggestions and Recommendations 68

15 Conclusion 70

16 Bibliography 73

17 Annexure 76
CHAPTER - I
INTRODUCTION

1
 Chapter – I
INTRODUCTION

INTRODUCTION
In today's changing world, finding the right individual for the appropriate job is critical. Companies

rely on qualified resources, but finding them is an expensive endeavor.Most firms have a conventional

hiring process that includes evaluating resumes, group discussions, interviews, and psychometric tests.

According to studies, companies are movingand adopting technology. Without abandoning the idea of

going global in social aspects, the recruiting cost can be decreased by having an e-recruitment

platform. Most Organizations should be concentrating on building an online recruitment procedure that

allows for the creation of concrete premade profiles. Banking sector is a backbone of any

financial system. Indian Banking Industry covers various segments such as current

account, saving account, housing loan, auto loan, personal loan, education loan,

consumer durable loan, credit card and debit card etc. There are various drivers of

banking in India which contributes in the growth of banking. To meet the changing

preferences of the customers and to stay ahead of competitors, bankers are bound to

provide quality and efficient services. Banks can enhance customer service by

leveraging on technology, maintenance of efficient service delivery standards and

business process re-engineering. The satisfaction of the customers is very important

factor in all service industries to enhance and improve the profitability. The

satisfaction level of the customers is varying due to different kinds of banking

services and their benefit to the customers

2
3
CHAPTER - II
COMPANY
PROFILE

4
 Chapter – 2

COMPANY PROFILE

COMPANY PROFILE

Service sector of an economy faces a continuous challenge of managing the quality of

service they provide. With the expanding consumer base as well as growing

competition, even banking sector is becoming customer driven. Therefore, nowadays

banking institutions focus on analyzing satisfaction levels of customers and try to

adopt differentiation in their services. Some researches done in this area are described

below. Kangis and Vassilis (1997) studied customer’s expectation and perception of

public and private banks of Greece. They studied five dimensions of service quality

and concluded that consumers of private sector banks have favorable impact of

quality received as compared to banks in public sector. Vasilis, Constantine and

Katerina (2005) made a similar attempt to study Greece customers’ satisfaction level.

Their study concluded that in terms of marketing efficiency public sector banks have

high perceived value while in terms of professional services and communications

private sector banks shows more satisfactory performance.

Al-Tamimi and Al-Amiri (2003) compared service quality between the Dubai Islamic

Bank and the Abu Dhabi Islamic Bank. The result of their study indicated no major

difference between service quality provided by these banks.

Islam and Ahmed (2005) used SERVQUAL model to compare private, public and

foreign banks in Dhaka. The study concluded that personal attention to clients, error

free records, safety of transactions and tangible physical facilities are most important

attributes to measure service quality. Another finding of the study demonstrates

5
significant difference between expected and perceived service quality of public and

private banks.

Ahmad, Rehman, Saif and Safwan (2010) examined how customers perceive the

services provided by Islamic and conventional banks in Pakistan. The study revealed

that customers of Islamic banks expect a high quality of service from their bank while

customers of conventional banks have low expectation in this regards.

Haq and Muhammad (2012) compared public and private sector banks of Pakistan.

Customers were found to be more satisfied with the private sector banking services.

As these banks were technologically well equipped and had multiple branches at

convenient locations.

Akhter (2012) analysed public and private sector banks of Bangladesh. The study

demonstrated a large gap between public and private banks. Commercial banks in

public sector needan overall change and improvement in its system so as to meet the

demand of their clients. The study also reveals that there exist a gap between

customer expectations and employee perception in private sector banks. Therefore

private sector should focus on internal as well as interactive marketing.

Yapa and Hasara (2013) researched customer satisfaction between customers of

public and private sector banks in Sri Lanka. Their study revealed that there exist a lot

of difference between performance and expectation of public and private sector banks.

The major areas where the performance gap persists are tangibility and reliability.

Aurora and Malhotra (1997) made efforts to study level of customer satisfaction and

marketing strategies adopted in public and private sector banks in India. Their study

explored various factors of satisfaction in these banks and concluded that customers

are more satisfied with private banks mainly because of the staff factor. They suggest

6
public sector banks to be well equipped, have trained staff, personalise the services

provided, avoid long queues, and keep their environment attractive.

Varghese (2000) conducted a study to compare public and private sector banks of

Kerela. He considered two banks from each category and analyzed their performance.

The study revealed that there exist no major differences between services of public

and private sector banks. Also, banks in both the sectors adopt similar internal

marketing strategies.

Bodla (2004) examined four private sector banks and four public sector banks of

Chandigarh, Delhi and Haryana in order to assess their service quality. He concluded

that expectations and perceptions of customers differ significantly in the banks of

these two sectors. Israel, Clement, and Selvam (2004) made similar attempt to analyse

service quality of banks. Their study identified that marketing efforts and performance

of banks in public sector are less efficient than in private sector, but when it comes to

reliability and security public sector banks are trusted more over private sector banks.

Sudesh (2007) analysed service quality of banks in India and reported that services of

public sector banks are of poor quality. These banks are rated low for tangibility,

responsiveness and empathy when compared to private sector banks. The study also

suggested that management should keep a close watch on potential failure points and

should make efforts to solve customer problems promptly.

Singh and Arora (2011) studied the factors effecting customer satisfaction with the

quality of services. The study was conducted in some selected branches of public and

private sector banks of Delhi. The respondents reported that they were not satisfied

with the employee behavior and infrastructure of public sector banks. While private

sector services were perceived to be cost with lack of accessibility and

communication.

7
Lohani and Shukla (2011) focused on banks in Lucknow city and concluded that

customers perceive services of private sector banks to be of superior quality than

banks in public sector.

Virk and Mahal (2012) presented a comparative analysis of level of customer

satisfaction towards services provided by public and private sector banks in

Chandigarh city. They identified that customers prefer private sector banks mainly

because of two reasons, firstly these banks focus on building and maintaining good

relationship with their clients and secondly as they are well equipped with the use of

modern technology as compared to banks in public sector.

Simon (2012) studied customers’ perception with respect to service quality of public

sector and private sector banks in Coimbatore. She concluded that private sector

banks give tough competition to public sector banks by providing better quality and

range of services to customers.

Franklin and Arul (2014) surveyed banks of Chennai city and compared satisfaction

and expectation of consumers of public and private sector banks. They reported that

service gap of private sector is better than public sector across all service dimensions

except assurance. Public sector banks must concentrate on improving their

performance in order to maintain their market share in Chennai

8
CHAPTER - III
LITERATURE
REVIEW

9
 Chapter – 3

LITERATURE REVIEW

LITERATURE REVIEW
Puja K and Yukti A reveals that Private Banks have more satisfied customers due to

good services. Private sector banks are successfully maintaining level of quantity of

its customers by providing better banking services than Public sector Banks. In any

economy, innovative technologies and changing expectations of markets,

consideration of quality of each and every service is important to enhance customers’

satisfaction level. Further, Puja K and Yukti A advocated that success mantra could

be customer centric orientation, where the customer relationships management with

its customers in Private sector Banks has been successful in achieving its goals.

However, Public sector banks have to improve in the area of dealing with the

customers. Private Banks need to focus on their loan and insurance services while

Public sectors banks need to improve their infrastructural facilities and provide some

training to the employees’ who are dealing with customers. Equipped with latest

technology, developed infrastructure and well trained employees, convenient office

hours and locations of the branches are the factors affecting the customers’

satisfaction level. Mishra US, Sahoo KK, Mishra S and Patra SK (2010) explained

that service quality, customers satisfaction, customers retention, customers loyalty etc.

are the major challenges to in attracting and retaining customers in banking sector.

Among all, customers’ satisfaction is playing a significant role in attracting, retaining

customers and creating brand loyalty among the customers. Mishra US, Mishra BB,

Praharaj S, and Mahapatra R observed that whole banking sector is facing the

10
challenge of attracting and retaining customers. They revealed that public sector

banks are better than private sector banks in attracting and retaining customers. The

main factors for opening a new account are convenient location and reputation of the

banks etc. Retired or higher age group business man customers prefer public sector

banks due to its high reputation. The customers of public sectors banks are more

satisfied than private sector banks. But, the major factors of dissatisfaction of

customers in public sector banks are enquiry counter and front office services. The

private sector banks are executing pure banking services while public sector banks

have to deploy some social responsibilities. Nirmaljeet V and Prabhjot KM explains

that infrastructural facilities in the branch not only leads to customer satisfaction but

overall improves the working of the branch [3] revealed that the Private Banks has

advanced technologically but the reverse situation is available in Public sector banks

observed from their analysis that that customer satisfaction in banks vary according to

the quality of services. Nominal charges of services, location of bank branches and

staff attitude towards solving problems of customers are the factors responsible for

highest customer’s satisfaction. Private bank customers are more satisfied with their

bank because of their multiple branches at convenient locations and technological

facilities. Public sector banks are not so technologically advanced. But, Public sector

banks are maintaining satisfaction level of the customers due to its reliability, high

reputation in the society and low charges of the services. Customer care services of

the Private Banks are better than Public sector banks. Vijay PG and Agarwal PK

found in their research that the empathy, friendly attitude of staff, and customer

guidance, customer support are the behavioral treatment factors for high customers’

satisfaction. Tangibility and empathy are the other factors create satisfaction among

customers. Private and Public sectors banks are needed to consider the weak areas of

11
the concern to enhance the level of satisfaction. According to Doddaraju ME, the

behavior of Public sector banks employees are not so courteous comparatively Private

sector banks. The Public banks should provide special training and developmental

programs to the employees engaged in directly dealing with customers. Development

of infrastructure and tangibility of the banks are also affecting the satisfaction level of

the customers. The new schemes of the investment and other related informations

should be published and displayed systematically. Customer relation management and

promotional schemes of the banks also increase satisfaction level. Puri J, Yadav SP

found that the public sectors bank performed better than private sector banks in all

dimensions and revealed that the new private sector banks are performing better than

the old private sector banks. The technical efficiency was better in public sector banks

comparatively private sector banks [4] indicated that the time factor is very important

for the customers and customer relationship should be maintained to satisfy the

customers. Location of the bank, timely delivery of the services and customer oriented

policy making are the factors enhance satisfaction in Private sector banks resulting

larger customers base. Public sector banks are equipped with latest technology and

technically trained staff. The infrastructural appearances and extra services like home

facility, round the clock facility etc. and query resolution through telephone, lowest

prices of the services and above all availability of the multiple products are the special

features in Private Banks to enhance the level of satisfaction of the customers [2]

observed that there is a significant relation between customer satisfaction and

dimensions of service quality in Public sector commercial Banks. Khushboo B,

Naveena C and Neha J explained in their study that people are more satisfied from the

Private sector banks due to their better services provided by them in terms of fast

transactions, fully automatic computerized facilities, more and convenient working

12
hours, advisory services, skilled and co-operative staff, better customer relationship

management etc. But, there is need to make aware rural customers about the services

of Private Banks. The most facility availed by customers of the Public sector banks

are ATM and least facilities are demat a/c and foreign transfer of funds. The Private

sector banks’ customers are using internet or phone banking by ATM/ Debit card.

Justin P, Arun M and Garima S [5] explains about Private sector banks’ fast services,

quick connection to the right person, efforts to reduce time in processing transactions,

knowledge of the banks products and responsiveness of the employees are positively

associated with the customers’ satisfaction level. In Public sector banks, slow

services, low knowledge of banking products appearance is the factors negative for

the satisfaction level of the customers. Kesari S and Nitin G [6,7] explain in his

studies that Public sector banks should work to attain the confidence of salaried class,

lower age group customers, students and self-employed businessman people. Private

sector banks should give much attention to the lower income group customers also

because the higher income group found the services provided by banks to be more

effective but high service charges, which is out of the reach of the lower income

group of customers. Seema S stated that the performance of urban banks on service

delivery and customer satisfaction exceeds the expectations of the customers in terms

of physical facilities, appearance of employees and attitude of employees to help

customers. Kumar J, Thamilselvan R [8-13] stated in his research that private sector

banks are competing with the public sector banks in terms of Capital Adequacy, Asset

Quality, Management Efficiency, Earning Capacity and Asset Quality. They found

that capital adequacy, assets quality and liquidity in public sector banks while

management efficiency, earning quality banks was better, comparatively [1]. found

that few customers are dissatisfied because of the poor responsiveness and empathy of

13
the employees in urban and rural area branches. Further, concluded that there is need

to give special training to the employees who are working in rural areas directly

dealing with the customers. Equipment of branches with latest technology,

Publication of required informations on the websites of the bank and unbiased

behavior of the employees are the factors lead to customers’ satisfaction in banking

industry.

14
CHAPTER - IV
OBJECTIVES OF
THE STUDY

15
 Chapter – 4

OBJECTIVES OF THE STUDY

OBJECTIVES OF THE STUDY

16
CHAPTER - V
RESEARCH
METHODOLOGY

17
 Chapter – 5

RESEARCH METHODOLOGY

RESEARCH METHODOLOGY

18
CHAPTER - VI
DATA ANALYSIS
&
INTERPRETATION

19
 Chapter – 6

Data Analysis and Interpretation

20
CHAPTER - VII
FINDINGS

21
 Chapter – 7

Findings

FINDINGS

22
CHAPTER - VII
LIMITATIONS OF
THE STUDY

23
 Chapter – 7

LIMITATIONS OF THE STUDY

LIMITATIONS OF THE STUDY

The respondents are only from few parts of India and rural respondents are very less

comparatively urban. Some respondents filled the questionnaire unwillingly. The

informations are collected from the respondents within one month and study is static

in nature while the satisfaction of the customers varying according to the change in

the services quality of the banks. So, the results of study may be different due to lag in

information collection, analysis and finally publication of research article.

24
CHAPTER - VIII
SUGGESTIONS
AND
RECOMMENDATIONS

25
 Chapter-8

Suggestions and Recommendations

SUGGESTIONS AND RECOMMENDATIONS

26
CHAPTER - IX
CONCLUSION

27
 Chapter-9
Conclusion

CONCLUSION

In Indian banking industry, banking customers from Urban and Rural areas are

satisfied and there is no significant difference among the customers from the Urban

and Rural areas. But, behaviors of Public sector banks’ employees are not supportive

in comparison to Private sector Banks. There are some infrastructural, tangibles and

ATMs related problems in Public sector Banks. There is need to provide special

training to the Public Banks employees’ to deal cordially with the customers of

different jobs, employment and gender. ATMs of Public Banks should be established

at more convenient and easy reachable places. There should be equipment of latest

technology Public sector banks to avoid inconvenience and delay. Although,

customers of Public and private Banks are satisfied but level of satisfaction in Private

banks is higher than the Public Banks due to some tangible and behavioral

consideration. In this research, there is only consideration of service quality

dimensions to customers’ satisfaction. So, there is further research scope available to

get satisfaction level of Public and Private bank customers’ weighing various aspects

of loans and deposit schemes of Private and Public sector banks.

28
29
BIBLIOGRAPHY

30
 BIBLIOGRAPHY

BIBLIOGRAPHY

31
ANNEXURE

32
 QUESTIONNAIRE

NAME:

33