International Journal of Commerce and Management Research

www.managejournal.com
ISSN: 2455-1627
Received: 04-03-2024, Accepted: 28-03-2024, Published: 20-04-2024
Volume 10, Issue 2, 2024, Page No. 132-136

A study on customer satisfaction towards retail banking services of YES Bank

Abstract
Banking in India in the modern sense originated in the last decades of the 18th century. Among the first banks were the Bank
of Hindustan, which was established in 1770 and liquidated in 1829-32; and the General Bank of India, established 1786 but
failed in 1791. With a jump in the Indian economy from a manufacturing sector, that never really took off, to a nascent service
sector, Banking as a whole is undergoing a change. A larger option for the consumer is getting translated into a larger demand
for financial products and customization of services is fast becoming the norm than a competitive advantage. The banking
sector as a whole is seeing structural changes in regulatory frameworks and securitization and stringent NPA norms expected
to be in place by 2004 means the faster one adapts to these changing dynamics, the faster is one expected to gain the
advantage. In this article, we try to study the reasons behind the euphemism regarding the Retail-focus of the Indian banks and
try to assess how much of it is worth the attention that it is attracting. This research work looks at future of retail banking and
customer’s satisfaction with reference to YES bank. Consumers all over the world have become more quality conscious;
hence, there has been an increased customer demand for higher quality services.

Keywords: Bank, retail banking, customer satisfaction, customer etc.

Introduction Vision
Indian Banking industry is one of the most technologically YES BANK’s vision is to become the ‘Best Quality Bank of
advanced industries with vast networks of branches the World’ in India and evolve its organizational ethos into
empowered by strong banking systems, their wide range of the “Professionals’ Bank of India”.
product and effective distribution channel capabilities.
However, regulatory, structural and technological factors Brand Pillars
At YES BANK, balanced growth is supported by our five
are significantly changing the banking environment
Brand Pillars:
throughout the world. One of the most important factors that
are motivating the growth of the Indian banking institutions Growth: YES BANK’s core promise of growth for
is the liberalization. The financial sector reforms in India stakeholders is represented through ‘Say YES to Growth!’
were designed to infuse greater competitive vitality in the
banking system. To achieve this objective, the “Narsimha Trust: YES BANK’s leadership team is of the highest
Committee” was formed. The Narsimha Committee report pedigree with a demonstrated track record reinforcing our
suggested wide ranging reforms for the Indian banking motto: ‘Say YES to Trust!’
sector in 1992, including the important one to introduce
internationally accepted banking practices so as to enable Human Capital: YES BANK has adopted a knowledge
driven, entrepreneurial management approach and offers
Indian banks to achieve service excellence.
financial solutions beyond the traditional realm of banking.
YES Bank is a private bank in India with headquarters YES BANK’s top quality Human Capital represents the
in Mumbai. It was founded in 2004 by promoters Ashok finest talent in the Indian banking sector.
Kapur and Rana Kapoor, which had a collective
shareholding of 29%. Ashok Kapur was killed in a terrorist Technology: YES BANK is establishing the highest
attack in 2008 in Mumbai. standards in customer service by adopting cutting-edge,
At YES BANK, our differentiation begins with a simple innovative technology. The only thing constant about
word ‘Yes’. ‘YES’ represents our true spirit of being technology used at YES BANK is evolution.
service-oriented. This spirit is supported by key facets,
which distinguish us from our peers. These facets comprise Transparency and Responsible Banking: YES BANK
considers Transparency and Accountability to be of utmost
knowledge, human capital, technology and responsibility.
importance. YES BANK has established one of the most
We are India’s fourth largest private sector bank. We have stringent Corporate Governance norms, and is committed to
steadily built a full-service commercial bank with Responsible Banking by focusing on Sustainability and
Corporate, Retail and SME Banking platforms, with a Social Responsibility.
comprehensive product suite of Financial Markets,
Investment Banking, Corporate Finance, Branch Banking, Retail Banking: Refers to banking in which banking
Business and Transaction Banking and Wealth institutions execute transactions directly with consumers,
Management. rather than corporations or other banks. Services offered

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include: savings and checking accounts, mortgages, Second: Rising indebtedness could turn out to be a cause
personal loans, debit cards, credit cards, and so forth. And to for concern in the future. India‘s position, of course, is not
know about the customer‘s perceptions about the different comparable to that of developed world where household
products of the bank like current account, savings account, debt as a proportion of disposable income is much higher.
FD, Smart Saver, Smart Access and others. Such a scenario creates high uncertainty. Expressing
As there are immense opportunities of the retail banking in concerns about the high growth witnessed in consumer
India. This project is on the issues and challenges in the credit segments the reserve bank has, as a temporary
retail banking because of the competition of the various measure, put in place risk containment measures and
banks and the customer satisfaction of the services which increased the weight from 100 percent to 125 percent in the
the banks are providing and at the same time to solve the case of consumer credit including personal loans and credit
complaints of the customer and maintaining the sound cards.
relationship for the future and by this way to estimate the
future growth of the retail banking. Third: Information technology poses both opportunities and
This division provides a range of financial services to challenges. Even with ATM machines and Internet Banking,
individual customers and small companies. It operates many of the customers still prefer the personal touch of their
mainly through branch networks. neighborhood branch bank. Technology has made it
Retail banking includes routine transactions like deposits possible to deliver services throughout branch network,
and withdrawals of money; money transfer; foreign providing instant updates to checking accounts and rapid
currency exchange and travellers cheque encashment. They movement of money for stock transfers. However, this
also deal with personal and small loans, credit and dependency on the network has bought IT department‘s
mortgages; insurance policies; investment schemes; pension additional responsibilities and challenges in managing,
funds; and advice to customers on various financial matters. maintaining and optimizing the performance of retail
Apart from offering home loans, car loans, educational banking networks. Illustratively, ensuring that all bank
loans, consumer loans, etc. They also develop various products and services are available, at all times, and across
deposit schemes and help people fill their coffers. the entire organization is essential for today‘s retail banks to
generate revenue and remain competitive. Besides, there are
Opportunities and challenge network management challenges, whereby keeping this
Retail banking has immense opportunities in a growing complex, distributed networks and applications operating
economy like India. As the growth story gets unfolded in properly in support of business objectives becomes
India, retail banking is going to emerge a major driver. How essential. Specific challenges include ensuring that account
does the world view us? The BRIC report is viewing India transaction applications run efficiently between the branch
as an economic superpower. A.T. Kearney, a global offices and data centers.
management-consulting firm, recently identified India as the
―second most attractive retail destination‖ of 30 emergent Fourth: KYC Issues and money laundering risks in retail
markets. banking is yet another important issue. Retail lending is
The rise of Indian middle class is an important contributory regarded as a low risk area for money laundering because of
factor in this regard. The percentage of middle to high- the perception of the sums involved. However, competition
income Indian households is expected to continue rising. for clients may also lead to KYC procedures being waived
The younger population not only wields increasing in the bid for new business. Banks must also consider
purchasing power, but as far as acquiring personal debt is seriously the type of identification documents the will
concerned, they are perhaps more comfortable than previous accept and other processes to be completed. The Reserve
generations. Improving consumer purchasing power, Bank has issued details guidelines on application of KYC
coupled with more liberal attitudes towards personal debt, is norms in November 2004.
contributing to India‘s retail banking segment.
The combination of above factors promises substantial Trends in Retail Banking
growth in retail sector, which at present is in the nascent Key trends in retail Banking are
stage. Due to bundling of services and delivery channels, the 1. Bifurcation of the retail banking business
areas of potential conflicts of interest tend to increase in ▪ National: Consolidate- Credit Cards, Home Equity
universal banks and financial conglomerates. Some of the Loans Mortgages
key policy issues relevant to the retail-banking sector are:
financial inclusion, responsible lending, and access to ▪ Local: Fragmented- Deposits, Installment Loans, Small
finance, long-term savings, financial capability, consumer Business Loans
protection, regulation and financial crime prevention.
2. Lack of differentiation in retail financial services
What are the challenges for the industry and its Many financial institutions are struggling to differentiate
stakeholders their value propositions
First: Retention of consumers is going to be a major In the retail banking market.
challenge. According to a research by Riechheld and Sasser ▪ Free checking is now offered by all or most financial
in the Harvard business review, 5percent increase in institutions.
customer retention can increase profitability by 35 percent ▪ Most institutions no longer charge for online banking or
in banking business, 50 percent in insurance and brokerage, online bill payment.
and 125 percent in the consumer credit card market. Thus, ▪ Extended branch hours are increasingly common in
banks need to emphasis on retaining consumer and many markets, as banks
increasing the market share. ▪ Seek to increase customer convenience.

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3. Proliferation and growth of electronic payments "outsourcing" as a means of both reducing costs and
In the last 25 years, the range of payment methods available achieving better efficiency. While outsourcing does have
in the market has exploded. In addition to cash, checks, and various cost advantages, it has the potential to transfer risk,
credit cards, consumers can now use one of an expanding management and compliance to third parties who may not
array of electronic payment options that includes debit be regulated.
cards, prepaid cards, online bill payment, automatic bill
payment, and P2P services. Finally: Retail banking does not refer to lending only. In the
whole story of retailing one should not forget the role
4. Increasing demand for ATM access played by retail depositors. The homemaker, the retail shop
Strategies for Ensuring high Customer Satisfaction keeper, the pensioners, self-employed and those employed
▪ Set service expectations and standards of behavior- this in unorganized sector - all need to get a place in the banks.
means that managers must set clear service expectations It is in this backdrop that the Annual Policy for 2005-06
and standards of behavior, beginning with defining pointed out issues relating to financial exclusion and had
"excellent service." announced that the RBI would implement policies to
▪ Identify and eliminate barriers and obstacles. Policies encourage banks which provide extensive services while
that do not make sense; procedures that get in the way; disincentivising those which are not responsive to
and rules, norms that make satisfying customers The banking needs of the community, including the
difficult all need to be eliminated to successfully underprivileged.
improve service
▪ Learn and develop skills. Clearly, personnel at all levels Literature review
should learn new skills related to service excellence and Sudhir (2005) in his study entitled as, “Growth Pattern of
serve the customer. Retail Banking” emphasizes that existing potential of Retail
▪ Listen to your customers. Measurement of customer Banking was untapped in rural and semi-rural areas and that
satisfaction can be a powerful way to improve service if untapped clientele provided a good and vast opportunity for
the feedback is not focused on punishment. Managers growth in this segment.
need to help staff hear, first hand, how they are doing. Timothy & Williams (2005) in their article, entitled as,
For this feedback to be effective, however, it must be “The Role of Retail Banking in the US Banking Industry:
tied to specific targets and goals and needs to be Risk, Return and Industry structure’ focused the return in
frontline driven retail’ in the US Banking industry, the reason for shift and
▪ Reinforce and support continuous improvement. The the rising trends in retail loan share. The observed trends in
real challenge is keeping the energy, learning, and retail loan shares, retail deposit shares, the balance sheets of
improving alive and going US consumer and the number of bank branches all indicate
an increased focus on retail activities. .
Future of Retail Banking Groeneveld & Wagemakers (2012) in their article entitled
How do we see the future of retail banking? What are the as, “Retail Banking Strategies”, focuses on retail banking
major attributes of the shape of things to come in this strategy and lays emphasis on retail banking in the broadest
sector? sense of the world. Many banks ‘rediscovered’ retail
First: Customer service should be the be-all and end-all of banking after the collapse of corporate and investment
retail banking. The other day a document released by the banking activities and the drop in stock prices in the last few
British Bankers Association, entitled UK Retail Banking years.
Manifesto: addressing the challenges that lie ahead for the Reinhold Leichtfuss, (2014) in the study entitled as, “Retail
industry and its stakeholders on September 29, 2004 came Banking – Winning Strategies and Business Models
to my notice. This document analyzed the key policy issues Revisited”, analyzed the performance of retail banking in
relevant to the retail banking sector and highlighted the role different western countries of the world. It high light the
of financial inclusion, responsible lending, access to strategies followed by different bank groups in the western
finance, and consumer protection. It is in this context that countries. It also aims to help banks reassess their strategies,
that one is reminded of the needs to develop the standards business models and plans for emerging from the crisis
and codes for banking. faster and in a stronger position than their peers. It also
includes insight into the performance of retail banks for
Second: Sharing of information about the credit history of 2001 to 2008 and in the first three quarters of 2009, based
households is extremely important as far retail banking is on data of more than 140 banks around the globe.
concerned. Perhaps due the confidential nature of banker- Thomas M. Hoening (2014) in his study entitled as, “The
customer, banks have a traditional resistance to share credit Future of Retail Banking and Payments - Developments in
information on the client, not only with one another, but Global Market, the Role of Central Banks”, points out that
also across sectors. Globally, Credit Information Bureaus the retail payments in the United States and worldwide have
have, therefore, been set up to function as a repository of an enormous transformation over the past decade driven by
credit information - both current and historical data on technology and change in consumer preference. Federal
existing and potential borrowers. Reserve study indicated that electronic payments now
exceed two-third of all non-cash payments in the United
Third: Outsourcing has become an important issue in the States. The major factor of the transformation banking
recent past. With the increasing market orientation of the system is efficiency convenience, speed and ease of use and
financial system and to cope with the competition as also to will continue to do so.
benefit from the technological innovations such as, e- Tantakasem & Lee (2014) in their study entitled as “Service
banking, the banks are making increasing use of Quality and the Customer Satisfaction Chain in the Retail

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Banking Industry”, attempt to create a better understanding ▪ 76% respondents view that Branch personnel had
of the relationship between different types of service quality listened to them patiently and have been able to respond
attributes and customer satisfaction by focusing on the retail to their queries and clarifications.
banking industry in Thailand. The study finds that there are ▪ 74% of respondent responded that Branch personnel
three types of quality attributes that affect customer had been very helpful and courteous.
satisfaction: (1) basic factors (2) performance factor, and (3) ▪ 72% of respondents opinioned that branch personnel
excitement factors, and that these factor will vary in their does Need Analyses & Risk Assessment of customer
impact on customer satisfaction. savings before recommending any investment option to
O.V. Safakali (2022) in his book entitled as, Testing them.
Seroquel Dimensions on the Commercial Bank Sector of ▪ 86% of respondent that branch personnel areaware of
Northern Cyprus” examines the sustainability of Seroquel Product and Services and responded to your queries.
dimensions towards the service quality of commercial bank ▪ 80% of respondents opinioned that waiting time at the
of Northern Cyprus. In the study, factor analysis as the Teller Counter is very good.
principal method of the research has necessitated the ▪ 90% of respondent opinioned that transactions are
revision of Seroquel dimensions so as to reflect unique smooth and error free & is very good.
customer preference in Northern Cyprus. ▪ 82% of respondent responded that Yes Bank looks into
the feedback & is very good.
Research methodology ▪ 80% of respondent opinioned that they are happy with
Research is Logical and precise look for picking up data and the TAT post request is very good.
learning on a particular subject or marvels. This study will ▪ 45% of respondent are in favour of Money Monitor
help us to understand the customer satistaction towards feature of the YBL Savings account.
retail banking and futre of retail banking. This study will ▪ 74% of the respondent opinioned that YES
help banks to understand, how a customer selects, organizes, COMMUNITY EVENTS are very good.
and interprets the various service offered by the banks. ▪ 78% of the respondent opinioned that information in
bank statement is clear, easy & adequate and is very
Objectives of study good.
▪ To study the issues and challenges in retail banking ▪ 90% of respondent opinioned that they will most
▪ To study the recent trends in retail banking definitely recommend YES BANK to their friends &
▪ To ensure high satisfaction level and reduce percentage relatives. Overall the response of the bank customer is
of complaints of customer in retail banking. good.
▪ To estimate the future growth of Indian retail banking.
Conclusion
Research design The study was very fruitful, it yielded the desired results,
Research design is simply the framework or plan for a helped me understand the retail banking. The study also
study, used as a guide in collecting and Analyzing data. For helps in what are the customer opinions towards operations
the study, Exploratory Research Design was undertaken to of bank & its various product and services.
classify the investors on their risk and return profile. Any serious discussion of the future of the retail banking
industry eventually raises a basic question: will future
Data collection customers still need retail banks? The answer, it turns out,
The method of collection of primary data was personal depends on banks themselves. With technology and
direct interview through a structured questionnaire. nonblank businesses providing new options for safeguarding
Questionnaire is the method of data collection, which is and managing their finances, customers will continue to
very much popular, particularly in big cities. Different depend on banks only as long as banks can provide service
modes of questions are put up on the paper and the and value that cannot be found anywhere else.
particular universe, on which the research is conducted, are The need to become highly customer focused has forced the
asked to fill their responses slow-moving public sector banks to adopt a fast track
The Secondary source includes data collection through: approach. The unleashing of products and services through
▪ Magazines the net has galvanized players at all levels of the banking
▪ Company Website and financial institutions market grid to look a new at their
existing portfolio offering. Conservative banking practices
Sampling technique allowed.
▪ Sample Size: Sample size for this research was Indian banks to be insulated partially from the Asian
restricted to 50 respondents. currency crisis. Indian banks are now quoting at higher
valuation when compared to banks in other Asian countries
▪ Sampling Method: For this research work Non- (viz. Hong Kong, Singapore, Philippines etc.) That have
Probability Convenience Sampling has been chosen. major problems linked to huge Non Performing Assets
(npas) and payment defaults. Co-operative banks are nimble
▪ Area of Study: Haryana footed in approach and armed with efficient branch
networks focus primarily on the ‗high revenue ‘niche retail
Findings segments.
▪ 90% of customers are happy with the bank timings & The Indian banking has finally worked up to the competitive
they opinioned that it is very good. dynamics of the new Indian market and is addressing the
▪ 80% of respondents like the branch ambience & layout relevant issues to take on the multifarious challenges of
and said that branch was clean and well maintained. globalization. Banks that employ IT solutions are perceived

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to be futuristic ‘and proactive players capable of meeting the

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