CHAPTER - 1

INTRODUCTION
TO THE INDUSTRY

INTRODUCTION TO THE INDUSTRY

BANKING
Definition of banking
The accepting for the purpose of lending or investment, of deposits from the public,
repayable on demand or otherwise and withdrawal by cheque, draft or otherwise.
(Banking Regulation Act)Dr. Paget in Law of Banking states, No one and no body,
corporate or otherwise, can be a banker who does not:
Conduct Current Accounts
Pays cheques drawn on himself
Collects cheques for his customers
A bank is therefore Any company that transacts the business of banking in

India.

Negotiable Instrument Act.

Banker:
Banker is Any person acting as a banker Negotiable Instrument Act.
Customer:
There must be some recognizable course or habit of dealing in the nature of regular
banking business. A single transaction can constitute a customer; must have an
account; dealing must be of a banking nature; some frequency in transactions is
expected but is not essential.
A customer brings us his wants. It is our job to handle them properly and profitably both to him and us.
A customer makes it possible to pay our salary, whether we are a driver, plant or office
employee.

An Overview of Banking Sector in India

2

Till the end of late 18th century, Banks in India, in the modern sense of the term, werent
there. During the time of the American Civil War, the supply of cotton to Lancashire (The
textile hub of UK) stopped from the Americas. At that time some banks were opened,
which functioned as entities to finance industry, including speculative trades in cotton.
Most of the banks opened in India during that period could not survive and failed
because of the high risk which came with large exposure to speculative ventures. It was
a disaster for depositors who lost money and therefore lost interest in keeping deposits
with banks.
In the year 1786, The General Bank of India was the first bank to come into
existence in India. And then, almost a century later, in the year 1870, The Bank of
Hindustan became the 2nd bank in India. Unfortunately, both these banks are now
defunct.1 The Bank of Bengal which later became the State Bank of India. The oldest
bank to be still in existence, that too as the largest bank in India, is the State Bank of
India. Albeit, the name was not the same as today rather was "The Bank of Bengal
which started its operations in Calcutta in June, 1806. At that point of time, Calcutta was
the most active trading port, thanks to the trade of the British Empire, and due to which
banking activity took roots there and prospered.
The first bank in India, though conservative, was established in 1786. From 1786
till today, the journey of Indian Banking System can be segregated into three distinct
phases. They are as mentioned below:
Early phase from 1786 to 1969 of Indian Banks
Nationalization of Indian Banks and up to 1991 prior to Indian banking sector
Reforms.
New phase of Indian Banking System with the advent of Indian Financial & Banking
Sector Reforms after 1991.
To make this write-up more explanatory, I prefix the scenario as Phase I, Phase II and
Phase III.
3

Phase I:The General Bank of India was set up in the year 1786. Next came Bank of
Hindustan and Bengal Bank. The East India Company established Bank of Bengal
(1809), Bank of Bombay (1840) and Bank of Madras (1843) as independent units and
called it Presidency Banks.
These three banks were amalgamated in 1920 and Imperial Bank of India was
established which started as private shareholders banks, mostly Europeans
shareholders. In 1865 Allahabad Bank was established and first time exclusively by
Indians, Punjab National Bank Ltd. was set up in 1894 with headquarters at Lahore.
Between 1906 and 1913, Bank of India, Central Bank of India, Bank of Baroda, Canara
Bank, Indian Bank, and Bank of Mysore were set up. Reserve Bank of India came in
1935.
During the first phase the growth was very slow and banks also experienced
periodic failures between 1913 and 1948. There were approximately 1100 banks, mostly
small. To streamline the functioning and activities of commercial banks, the Government
of India came up with The Banking Companies Act, 1949 which was later changed to
Banking Regulation Act 1949 as per amending Act of 1965 (Act No. 23 of 1965).
Reserve Bank of India was vested with extensive powers for the supervision of banking
in India as the Central Banking Authority. During those days public has lesser
confidence in the banks. As an aftermath deposit mobilization was slow.
Phase II:Government took major steps in this Indian Banking Sector Reform after
independence. In 1955, it nationalized Imperial Bank of India with extensive banking
facilities on a large scale especially in rural and semi-urban areas Seven banks forming
subsidiary of State Bank of India was nationalized in 1960 on 19th July, 1969, major
process of nationalization was carried out. It was the effort of the then Prime Minister of
India, Mrs. Indira Gandhi. 14 major commercial banks in the country was Nationalized.
4

The following are the steps taken by the Government of India to Regulate Banking
Institutions in the Country:
1949: Enactment of Banking Regulation Act. 1955: Nationalization of State Bank of
India.
1959: Nationalization of SBI subsidiaries.
1961: Insurance cover extended to deposits.
1969: Nationalization of 14 major banks.
1971: Creation of credit guarantee corporation.
1975: Creation of regional rural banks.
1980: Nationalization of seven banks with deposits over 200 crore.
After the nationalization of banks, the branches of the public sector bank India rose to
approximately 800% in deposits and advances took a huge jump by 11,000%. Banking
in the sunshine of Government ownership gave the public implicit faith and immense
confidence about the sustainability of these institutions.
Phase III:This phase has introduced many more products and facilities in the banking sector in its
reforms measure. In 1991, under the chairmanship of M Narasimham, a committee was
set up by his name which worked for the liberalization of banking practices.
The country is flooded with foreign banks and their ATM stations. Efforts are
being put to give a satisfactory service to customers. Phone banking and net banking is
introduced.

The

entire

system

became

more

convenient

and

swift.

The financial system of India has shown a great deal of resilience. It is sheltered from
any crisis triggered by any external macroeconomics shock as other East Asian
Countries suffered. This is all due to a flexible exchange rate regime, the foreign
reserves are high, the capital account is not yet fully convertible, and banks and their
customers have limited foreign exchange exposure.
5

Current Situation:Today, the banking sector in India is fairly mature in terms of supply, product
range and reach. As far as private sector and foreign banks are concerned, the reach in
rural India still remains a challenge. In terms of quality of assets and capital adequacy,
Indian banks are considered to have clean, strong and transparent balance sheets
relative to other banks in comparable economies in its region.
The Reserve Bank of India is an autonomous body, with minimal pressure from
the government. The stated policy of the Bank on the Indian Rupee is to manage
volatility but without any fixed exchange rate. Till now, there is hardly any deviation seen
from this stated goal which is again very encouraging. With passing time, Indian
economy is further expected to grow and be strong for quite some time-especially in its
services sector. The demand for banking services, especially retail banking, mortgages
and investment services are expected to grow stronger. Therefore, it is not hard to
forecast few M&As, takeovers, and asset sales in the sector. Consolidation is going to
be another order of the day. The significant change in the policy and attitude that is
currently being seen is encouraging for the banking sector growth.
In March 2006, the Reserve Bank of India allowed Warburg Pincus, a private
foreign investor, to increase its stake in Kotak Mahindra Bank to 10%. Notably, this is
the first time that a foreign individual investor has been allowed to hold more than 5% in
a private sector bank since 2000. Earlier, RBI in 2005 announced that any stake
exceeding 5% by foreign individual investors in the private sector banks would need to
be vetted by them. Currently, India has 88 scheduled commercial banks (SCBs) - 28
public sector banks (that is with the Government of India holding a stake), 29 private
banks (these do not have government stake; they may be publicly listed and traded on
stock exchanges) and 31 foreign banks. They have a combined network of over 53,000
branches and 17,000 ATMs. According to a report by ICRA Limited, a rating agency, the
6

public sector banks hold over 75 percent of total assets of the banking industry, with the
private and foreign banks holding 18.2% and 6.5% respectively.3

Banking System in India:In India the banks are being segregated in different groups. Each group has their
own benefits and limitations in operating in India. Each has their own dedicated target
market. Few work in rural sector while others in both rural as well as urban. Many even
are only catering in cities. Some are of Indian origin and some are foreign players.
Public Sector Bank: Among the Public Sector Banks in India, United Bank of India is one of the 14 major
banks which were nationalised on July 19, 1969. Its predecessor, in the Public
Sector Banks, the United Bank of India Ltd., was formed in 1950 with the
amalgamation of four banks viz. Comilla Banking Corporation Ltd. (1914), Bengal
Central Bank Ltd. (1918), Comilla Union Bank Ltd. (1922) and Hooghly Bank Ltd.
(1932).
Private Sector Bank: The first Private bank in India to be set up in Private Sector Banks in India was
Indusind Bank. It is one of the fastest growing Private Sector Banks in India.
IDBI ranks the tenth largest development bank in the world as Private Banks in India
and has promoted world class institutions in India.
The first Private Bank in India to receive an in principle approval from the Reserve
Bank of India was Housing Development Finance Corporation Limited, to set up a
bank in the private sector banks in India as part of the RBI' s liberalisation of the
Indian Banking Industry.

It was incorporated in August 1994 as HDFC Bank Limited with registered office in
Mumbai and commenced operations as Scheduled Commercial Bank in January
1995.

Co operative Banks in India: The Co operative banks in India started functioning almost 100 years ago.
7

 Though the co operative movement originated in the West, but the importance of
such banks have assumed in India is rarely paralleled anywhere else in the world.
The cooperative banks in India play an important role even today in rural financing.
The businesses of cooperative bank in the urban areas also have increased
phenomenally in recent years due to the sharp increase in the number of primary cooperative banks.
Co operative Banks in India are registered under the Co-operative Societies Act. The
cooperative bank is also regulated by the RBI. They are governed by the Banking
Regulations Act 1949 and Banking Laws (Co-operative Societies) Act, 1965.
This exponential growth of Co operative Banks in India is attributed mainly to their
much better local reach, personal interaction with customers, and their ability to
catch the nerve of the local clientele.
Rural Banking: Rural banking in India started since the establishment of banking sector in India.
Rural Banks in those days mainly focussed upon the agro sector.
The Haryana State Cooperative Apex Bank Ltd. commonly called as HARCOBANK
plays a vital role in rural banking in the economy of Haryana State and has been
providing aids and financing farmers, rural artisans, agricultural labourers,
entrepreneurs, etc. in the state and giving service to its depositors.
National Bank for Agriculture and Rural Development (NABARD) is a development
bank in the sector of Regional Rural Banks in India. It provides and regulates credit
and gives service for the promotion and development of rural sectors mainly
agriculture, small scale industries, cottage and village industries, handicrafts.
Foreign Banks in India: Foreign Banks in India always brought an explanation about the prompt services to
customers. After the set up foreign banks in India, the banking sector in India also
become competitive and accurative.
New policies are introduced by RBI for them
8

Reserve Bank of India as a Regulatory Institution in Banking Sector:The RBI was established under the Reserve Bank of India Act, 1934 on April 1, 1935 as
a private shareholders' bank but since its nationalization in 1949, is fully owned by the
Government of India. The Preamble of the Reserve Bank describes the basic functions
as 'to regulate the issue of Bank notes and keeping of reserves with a view to securing
monetary stability in India and generally, to operate the currency and credit system of
the country to its advantage'. The twin objectives of monetary policy in India have
evolved over the years as those of maintaining price stability and ensuring adequate
flow of credit to facilitate the growth process. The relative emphasis between the twin
objectives is modulated as per the prevailing circumstances and is 24 articulated in the
policy statements by the Reserve Bank from time to time. Consideration of macroeconomic and financial stability is also subsumed in the mandate. The Reserve Bank is
also entrusted with the management of foreign exchange reserves (which include gold
holding also), which are reflected in its balance sheet. While the Reserve Bank is
essentially a monetary authority, its founding statute mandates it to be the manager of
market borrowing of the Government of India and banker to the Government.
The Reserve Bank's affairs are governed by a Central Board of Directors, consisting of
fourteen non-executive, independent directors nominated by the Government, in
addition to the Governor and up to four Deputy Governors. Besides, one Government
official is also nominated on the Board who participates in the Board meetings but
cannot vote.

Important Functions Played by Reserve Bank of India

1. Main Functions
Monetary Authority
Regulation and Supervisor of Financial System
Manager of Exchange Control
Issuer of the Currency
Developmental Role
Banker to The Government
2. Supervisory Functions
3. Promotional Functions
RECENT INNOVATIONS IN INDIAN BANKING
Foreign Direct Investment (FDI)

Non-Performing Assets (NPAs)

Priority Sector Lending
Merger/Amalgamation of Banks
Branch Expansion
Gross Domestic Product (GDP)
Online Banking
Net Banking
Real Time Gross Settlement (RTGS)
Technology
ATM

Before getting into the details of how CRM actually works in the financial sector, it is
very important to know your customer.
Know Your Customer (KYC)
It is very important to know the customer before having any kind of relationship with him
(especially in the banking sector).This is important because of drugs smuggling/
trafficking,

money

laundering

and terrorism coming up. If one has to build a

relationship with the customer one should follow all the KYC norms laid down by RBI.
Under the KYC a customer is:

10

A person or entity that maintains an account and/ or has a business

o
o

relationship with the bank

One on whose behalf an account is maintained
Any person/ entity connected with financial transaction which can
pose significant reputation or other risks.

The RBI States:

KYC must be the key principle for identification of an individual/ corporate for opening
an Account. This would entail verification through an introductory reference from an
existing Account holder, through a person known to the bank or on the basis of
documents provided by the customer.
CONCLUSION
We can conclude that the financial sector is a nerve system of Indian economy. Banking
plays an important role in development of economy. For steady growth in economy
innovations and development in financial sector is very important. Economy of any
country faces lots of challenges and problems. To tackle those problems financial sector
plays a vital role. The financial sector makes the economy efficient to the extent where it
can rival other developed economies in the world. Financial sector also faces lots of
problems but it should develop certain strategies to come out of these problems which
is very important for healthy growth of economy.

11

CHAPTER - 2
INTRODUCTION TO ORGANISATION

OVERVIEW
State Bank of India is the largest and one of the oldest commercial bank in India, in
existence for more than 200 years. The bank provides a full range of corporate,
commercial and retail banking services in India. Indian central bank namely Reserve
Bank of India (RBI) is the major share holder of the bank with 59.7% stake. The bank is
capitalized to the extent of Rs.646bn with the public holding (other than promoters) at
40.3%. SBI has the largest branch and ATM network spread across every corner of
12

India. The bank has a branch network of over 14,000 branches (including subsidiaries).
Apart from Indian network it also has a network of 73 overseas offices in 30 countries in
all time zones, correspondent relationship with 520 International banks in 123 countries.
In recent past, SBI has acquired banks in Mauritius, Kenya and Indonesia. The bank
had total staff strength of 198,774 as on 31st March, 2006. Of this, 29.51% are officers,
45.19% clerical staff an the remaining 25.30% were sub-staff. The bank is listed on the
Bombay Stock Exchange, National Stock Exchange, Kolkata Stock Exchange, Chennai
Stock Exchange and Ahmedabad Stock Exchange while its GDRs are listed on the
London Stock Exchange. SBI group accounts for around 25% of the total business of
the banking industry while it accounts for 35% of the total foreign exchange in India.
With this type of strong base, SBI has displayed a continued performance in the last few
years in scaling up its efficiency levels. Net Interest Income of the bank has witnessed a
CAGR of 13.3% during the last five years. During the same period, net interest margin
(NIM) of the bank has gone up from as low as 2.9% in FY02 to 3.40% in FY06 and
currently is at 3.32%.

Shareholding & Liquidity (Till 30th Sept. 2007)

Reserve Bank of India is the largest shareholder in the bank with 59.7% stake followed
by overseas investors including GDRs with 19.78% stake as on September 06. Indian
financial institutions held 12.3% while Indian public held just 8.2% of the stock. RBI is
the monetary authority and having majority shareholding reflects conflict of interest.
Now the government is rectifying the above error by transferring RBIs holding to itself.
13

Post this, SBI will have a further headroom to dilute the GOIs stake from 59.7% to
51.0%, which will further improve its CAR and Tier I ratio.

Key Areas of Operations

The business operations of SBI can be broadly classified into the key income
generating areassuch as National Banking, International Banking, Corporate Banking, &
Treasury operations.

HISTORY
14

The origin of the State Bank of India goes back to the first decade of the nineteenth
century with the establishment of the Bank of Calcutta in Calcutta on 2 June 1806.
Three years later the bank received its charter and was re-designed as the Bank of
Bengal (2 January 1809). A unique institution, it was the first joint-stock bank of British
India sponsored by the Government of Bengal. The Bank of Bombay (15 April 1840)
and the Bank of Madras (1 July 1843) followed the Bank of Bengal. These three banks
remained at the apex of modern banking in India till their amalgamation as the Imperial
Bank of India on 27 January 1921.
Primarily Anglo-Indian creations, the three presidency banks came into
existence either as a result of the compulsions of imperial finance or by the felt needs of
local European commerce and were not imposed from outside in an arbitrary manner to
modernise India's economy. Their evolution was, however, shaped by ideas culled from
similar developments in Europe and England, and was influenced by changes occurring
in the structure of both the local trading environment and those in the relations of the
Indian economy to the economy of Europe and the global economic framework .

The three banks were governed by royal charters, which were revised from time to time.
Each charter provided for a share capital, four-fifth of which were privately subscribed
and the rest owned by the provincial government. The members of the board of
directors, which managed the affairs of each bank, were mostly proprietary directors
representing the large European managing agency houses in India. The rest were
government nominees, invariably civil servants, one of whom was elected as the
president of the board.

15

Group Photograph of Central Board (1921)

Business
The business of the banks was initially confined to discounting of bills of exchange or
other negotiable private securities, keeping cash accounts and receiving deposits and
issuing and circulating cash notes. Loans were restricted to Rs.one Lakh and the period
of accommodation confined to three months only. The security for such loans was public
securities, commonly called Company's Paper, bullion, treasure, plate, jewels, or goods
'not of a perishable nature' and no interest could be charged beyond a rate of twelve per
cent. Loans against goods like opium, indigo, salt woollens, cotton, cotton piece goods,
mule twist and silk goods were also granted but such finance by way of cash credits
gained momentum only from the third decade of the nineteenth century. All
commodities, including tea, sugar and jute, which began to be financed later, were
either pledged or hypothecated to the bank. Demand promissory notes were signed by
the borrower in favour of the guarantor, which was in turn endorsed to the bank.
Lending against shares of the banks or on the mortgage of houses, land or other real
property was, however, forbidden.
First Five Year Plan In 1951, when the First Five Year Plan was launched, the
development of rural India was given the highest priority. The commercial banks of the
country including the Imperial Bank of India had till then confined their operations to the
urban sector and were not equipped to respond to the emergent needs of economic
16

regeneration of the rural areas.

In order, therefore, to serve the economy in general and the rural sector in particular, the
All India Rural Credit Survey Committee recommended the creation of a state-partnered
and state-sponsored bank by taking over the Imperial Bank of India, and integrating with
it, the former state-owned or state-associate banks. An act was accordingly passed in
Parliament in May 1955 and the State Bank of India was constituted on 1 July 1955.
More than a quarter of the resources of the Indian banking system thus passed under
the direct control of the State. Later, the State Bank of India (Subsidiary Banks) Act was
passed in 1959, enabling the State Bank of India to take over eight former Stateassociated banks as its subsidiaries (later named Associates).
The State Bank of India was thus born with a new sense of social purpose aided by the
480 offices comprising branches, sub offices and three Local Head Offices inherited
from the Imperial Bank.

COMPETITORS
Competitors and other players in the field:Top Performing Public Sector Banks
Andhra Bank
Allahabad Bank

17

Punjab National Bank

Dena Bank
Top Performing Private Sector Banks
ICICI Bank
AXIS Bank
Kotak Mahindra Bank
Centurion Bank of Punjab
Hdfc bank
Top Performing Foreign Banks
Citibank
Standard Chartered
HSBC Bank
ABN AMRO Bank
American Express

DIFFERENT PRODUCTS OF SBI:

DEPOSIT

LOANS

CARDS

DIFFERENT CREDIT
CARDS

Savings

Home

18

Consumer

SBI

Account

Loans

Cards

International
cards

Life Plus

Loan

Senior Citizens

Against

Savings

Property

Credit Card

SBI Gold
cards

Account

Fixed
Deposits
Security
Deposits

Recurring

Personal

Travel Card

SBI Gold

Master cards
Your City Your

Loans

Car Loan

Debit Cards

Loans

Commercial

Deposits

against

Cards

Cards

Securities

Tax-Saver

Fixed Deposit

Salary Account

Two

Wheeler

Corporate

Cards

Pre-

Prepaid Card

Purchase Card

Partnership
Cards

approved
Loans

Advantage

Retail Asset

Woman

SBI Employee
Cards

Savings
Account

Rural Savings

Account

People's

Farmer

Finance

Distribution
Cards

Business

19

Business Card

SBI Advantage

Savings
Account

Installment

Cards

Loans

20

Introduction of CRM
For a long time companies saw their customers only as transactions, focusing their
efforts on everything that surrounded the customer but without ever actually getting to
the customer. Every organization realizes the need to get closer to the customer to
increase market share and fight competition, particularly in the fast moving turbulent
environment. Thus the marketing functions are fast changing to adapt themselves to
changing challenges faced at various fronts. With multiple sales channels, increasing
competition and ever-reducing margins, the need to listen to the customer closely has
never been greater than it is today.Building a long lasting, mutually beneficial
relationship with the customer has assumed tremendous importance in todays business
21

environment. Marketers now understand that retaining the customers is far more
challenging though profitable than acquiring new customers in the fast moving
competition. The most profitable companies are those that make the smartest decisions
about investments in attracting and retaining customers. Thus the traditional
transactional approach to achieve marketing goals became insufficient. This situation
necessitated the emergence of new approach namely relationship building through
CUSTOMER RELATIONSHIP MANAGEMENT. Customer Relationship Management
(CRM) has now become a strategic necessity for the sales and business development
professionals who continuously strive to be one up their competitors.
Traditionally, few people changed their banks unless serious problems occurred. In the
past there was, to certain extent, a committed, often inherited relationship between a
customer and his/her bank. The philosophy, culture and organization of financial
institutions were grounded in this assumption and reflected in their marketing policies,
which were product and transaction-oriented, reactionary, focused on discrete rather
than continuous activities.
Today, financial institutions can no longer rely on these committed relationships or
established marketing techniques to attract and retain customers. As markets break
down into heterogeneous segments, a more precisely targeted marketing technique is
required, which creates a dialogue with smaller groups of customers and identifies
individual needs. Also,before the Internet revolution, consumers largely selected their
banks based on how convenient the location of bank's branches was to their homes or
offices. With the advent of new technologies in the business of bank, such as Internet
banking and ATMs, now customers can freely chose any bank for their transactions.
Thus, the customer base of banks has increased, and so has the choices of customers
for selecting the banks.

22

History of Customer Relationship Management

Customer Relationship Management (CRM) is one of those magnificent concepts that
swept the business world in the 1990s with the promise of forever changing the way
businesses small and large interacted with their customer bases. In the short term,
however, it proved to be an unwieldy process that was better in theory than in practice
for a variety of reasons. First among these was that it was simply so difficult and
expensive to track and keep the high volume of records needed accurately and
constantly update them. In the last several years, however, newer software systems and
advanced tracking features have vastly improved CRM capabilities and the promise of
CRM is becoming a reality.
The evolution of CRM was gradual. The concentration at the beginning was only on
consumption. Human activities were confined to consuming whatever was available
within their reach. Then the concentration slowly moved towards production. Production
was though in starting just for consumption on later it moved towards production for
exchange. During the sales era, production was performed exclusively for sales and the
attention was just on the product. Whatever was produced became saleable because
of the limited supply. This made organization move towards marketing activities. It is at
this stage the concentration shifted from products to customers. Understanding and
meeting customers needs became imperative for any business survival. Thus the
emergence of customer driven organizations, keeping customers as their focal point
took place. However cut throat competition made it difficult and challenging to retain
customers. CRM emerged as a new approach enabling marketers with brand new tool
and techniques to reach, acquire, retain and expand customer base. Through CRM
companies tried to re-personalize their customer relationships by installing sales
technology - sales contact management, Web personalization of e-sales messages, and
sophisticated segmenting and predictive modeling tools for more tailored sales
messages.
In the beginning
23

The 1980s saw the emergence of database marketing, which was simply a catch
phrase to define the practice of setting up customer service groups to speak individually
to all of a companys customers. In the case of larger, key clients it was a valuable tool
for keeping the lines of communication open and tailoring service to the clients needs.
In the case of smaller clients, however, it tended to provide repetitive, survey-like
information that cluttered databases and didnt provide much insight.
However database marketing was too costly, too difficult and didnt pay out on the
bottom line, except in the case of business-to-business key account marketing. A little
database marketing went a long way, which was very good news for everyone except
technology vendors. Organizations could do quite well simply by knowing how recently
and frequently customers purchase; how much they spend; what they purchase; and an
iota of customers demographics.

Advances in the 1990s

In the 1990s companies began to improve on Customer Relationship Management by
making it more of a two-way process. Instead of simply gathering data for their own use,
they began giving back to their customers not only in terms of the obvious goal of
improved customer service, but in incentives, gifts and other perks for customer
loyalty.This was the beginning of the now familiar frequent flyer programs, bonus points
on credit cards and a host of other resources that are based on CRM tracking of
customer activity and spending patterns. CRM was now being used as a way to
increase sales passively as well as through active improvement of customer service.

Customer Relationship Management: The Concept

24

Customer Relationship Management is the establishment, development, maintenance

and optimization of long-term mutually valuable relationships between consumers and
the organizations. Successful customer relationship management focuses on
understanding the needs and desires of the customers and is achieved by placing these
needs at the heart of the business by integrating them with the organization's strategy,
people, technology and business processes.
Customer Relationship Management (CRM), also known as relationship marketing or
customer

management,

is

an

information

technology

industry

term

for

the

methodologies, strategies, software, and other web-based capabilities used to help an

enterprise organize and manage customer relationships. The goal of CRM is to aid
organizations in better understanding each customer's value to the company, while
improving

the

efficiency

and

effectiveness

of

communication.

MODEL OF CRM
We now consider the Business Strategy Perspective on CRM. Here, we propose a
model, which is a hybrid, and typical of many of the models and diagrams of CRM that
you will find on The Internet and in popular books on the topic of marketing/ecommerce.
The model has three key phases and three contextual factors:

25

Three key phases:

1. Customer Acquisition.

2. Customer Retention.

3. Customer Extension.

Three contextual factors:

4. Marketing Orientation.

5. Value Creation.

6. Innovative

1. Customer Acquisition - This is the process of attracting our customer for the first
their first purchase. We have acquired our customer.
Growth - Through market orientation, innovative IT and value creation we aim to
increase the number of customers that purchase from us for the first time.

26

2. Customer Retention - Our customer returns to us and buys for a second time. We
keep them as a customer. This is most likely to be the purchase of a similar product or
service, or the next level of product or service.
Growth - Through market orientation, innovative IT and value creation we aim to
increase the number of customers that purchase from us regularly.
3. Customer Extension - Our customers are regularly returning to purchase from us.
We introduce products and services to our loyal customers that may not wholly relate to
their original purchase. These are additional, supplementary purchases. Of course once
our loyal customers have purchased them, our goal is to retain them as customers for
the extended products or services.
Growth - Through market orientation, innovative IT and value creation we aim to
increase the number of customers that purchase additional or supplementary products
and services.
4. Marketing Orientation - means that the wholes organization is focused upon the
needs of customers. Customer needs are addressed by the Three Levels of a Product
whereby the organizations not only supplies the actual, tangible product, but also the
core product and its benefit, and also the augmented product such as a warranty and
customer service. Marketing orientation will focus upon the needs of consumers for all
three levels of a product. (N.B. 'market' orientation and 'marketing' orientation are not
the same).
5. Value Creation - centers on the generation of shareholder value based upon the
satisfaction of customer needs (as with marketing orientation) and the delivery of a
sustainable competitive advantage.
6. Innovative IT - is exactly that - Information Technology must be up-to-date. It should
be efficient, speedy and focus upon the needs of customers. Whilst IT and/or software
27

are not the entire story for CRM, it is vital to its success. CRM software collects data on
consumers and their transactions. Huge databases store data on individuals and groups
of individuals. In some ways, CRM means that an organization is dealing with a
segment of one person, since every consumer displays different purchasing habits and
preferences.

Building Customer Relationship Management

Achieving the long-term value of customer relationship management (CRM)
requires a strategy involving the whole business and should be approached at an
enterprise level. Only a small, but growing, number of enterprises are tackling
CRM at this level, with most CRM initiatives consisting of departmental projects

or attempts to integrate the work of multiple projects.

Executing CRM requires board-level vision and leadership to drive a relentless
focus on the customer. It involves learning new customer management skills,
culture and organization, and grappling with the technology challenges of multichannel alignment and systems integration. Even if the top management accepts
the need for enterprise-level CRM, the high reliance on meeting sales and profit
targets often mean that, although CRM is the most important challenge facing an
enterprise, it is not seen as the most urgent. Besides lack of leadership and
support from top management, the main reason that enterprises are not
approaching CRM at an enterprise level is inability to see the big picture, lack of

a strategic framework to provide the support for the CRM journey

Gartner created the Eight Building Blocks of CRM a framework to help
enterprises see the big picture, make their business cases and plan their CRM
implementation. The framework can be used to develop the CRM vision and
strategies. It can also be the basis of an assessment of the enterprises existing
and required CRM capabilities, to help understand its current position and future
strategy.

The framework emphasizes the need to create a balance between the

requirements of the enterprise and the customer. The two central building blocks
28

in Figure 1 (valued customer experience and organizational collaboration) are

joined by a yin and yang motif to emphasize that this is where people meet, build
relationships and provide value to each other. Too many CRM initiatives suffer
from an inward focus on the enterprise, whereas the point of CRM is to achieve a
balance between value to shareholders or stakeholders and value to customers
for mutually beneficial relationships.
The Eight Building Blocks of CRM are
1. CRM Vision: Leadership, Market Position, Value Proposition
2. CRM Strategy: Objectives, Segments, Effective Interaction
3. Valued Customer
4. Organizational Collaboration
5. CRM Processes: Customer Life Cycle, Knowledge Management
6. CRM Information: Data, Analysis, One View across Channels
7. CRM Technology: Applications, Architecture, Infrastructure
8. CRM Metrics: Value, Retention, Satisfaction, Loyalty, Cost to Serve

Creating a CRM Vision

Successful CRM demands a clear vision so that a strategy and implementation
can be developed to achieve it. The CRM vision is how the customer-centric
enterprise wants to look and feel to its customers and prospects the customer
value proposition (CVP) and the corporate brand values are key to the CRM
vision. Without a CRM vision, the enterprise will not stand out from the
competition, target customers will not know what to expect from it and employees
will not know what to deliver in terms of external customer experience. A
successful CRM vision is the cornerstone to motivating staff, generating
customer loyalty and gaining a greater market share.
Developing a CRM Strategy
A CRM strategy is not an implementation plan or road map. A real CRM strategy
takes the direction and financial goals of the business strategy and sets out how
the enterprise is going to build customer loyalty that feel-good factor of
customer connection with an enterprise that means customers stay longer, buy
29

more, recommend the enterprise to others and are more willing to pay a premium
price. The objectives of a CRM strategy are to target, acquire, develop and retain
valuable customers to achieve corporate goals.
Customer Experience: The Voice of the Customer:
Customers experiences when interacting with the enterprise play a key role in
shaping their perception of the enterprise the value it provides and the
importance it places on the customer relationship. Good customer experiences
drive satisfaction, trust and long-term loyalty. Poor customer experiences have

the opposite effect and,

Because bad news travels faster and further than good news, they harm the
enterprises ability to create new relationships with prospects. No amount of
internal second guessing can simulate what its really like to be a customer.

True CRM Requires Organizational Collaboration

Many enterprises believe that implementing CRM technologies makes them a
customer-centric organization. They forget, ignore or deliberately avoid the
necessary changes to the enterprise itself. True CRM means that individuals,
teams and the whole enterprise must become more focused on the needs and
wants of the customer. The term organizational collaboration, highlights the
many facets of the customer-centric internal change needed to deliver the
required and desired external customer experience. As a critical part of a CRM
program, it will involve changing organizational structures, incentives and
compensation, skills and even the enterprise culture.

Customer Process Re-engineering: Talk to Your Customers

Past efforts to re-engineer processes were primarily driven by the desire to
improve the efficiency of an enterprise and reduce costs. The beneficiary was the
enterprise, not its customers. The rise in CRM has led to a focus on reworking
key processes that touch the customer and asking customers which processes
matter to them. Enterprises frequently do not realize that their functionally
30

fragmented processes often mean that the customer has a poor experience and
receives less than the expected value. Successful re-engineering should create
processes that not only meet customers expectations, but also support the
customer value proposition, provide competitive differentiation and contribute to
the desired customer experience.

Customer Information: Is the Lifeblood of CRM

Successful CRM requires a flow of customer information around the organization
and tight integration between operational and analytical systems. Having the right
information at the right time is fundamental to successful CRM strategies,
providing customer insight and allowing effective interaction across any channel.
Unfortunately, most enterprises CRM information capabilities are poor the
result of numerous and fragmented departments, initiatives, databases and
systems. Enterprises that establish a business plan for sourcing, managing and
leveraging their customer information assets are more likely to achieve their
CRM goals and objectives and gain a competitive advantage
Technology Decisions Are Key to Enabling CRM Strategies
For most technologists, CRM is all about technology. CRM technologies are an
essential enabler for any modern CRM business strategy, but they are just one
piece of the puzzle. Key Technology decisions that enterprises have to take are
in three areas namely CRM applications, architectural issues and integration. In
many CRM projects, integration issues start as a relatively low priority, and then
rise in prominence (cost and time) as enterprises realize that true CRM requires
seamless customer-centric processes, supported by integrated technology
across the enterprise and its supply chain.

Getting the Best Out of CRM Performance Metrics

The other seven building blocks depend on performance targets and metrics to
gauge their success, and enterprises must set measurable CRM objectives and monitor
CRM indicators to successfully turn customers into assets. Without performance
31

management, a CRM strategy a program is destined to fail. Getting the Best out of
CRM Performance Metrics introduces a framework for measuring an enterprises
success with CRM by creating a hierarchy of performance metrics.

Need of CRM in the Banking Industry

A Relationship-based Marketing approach has the following benefits: 1. Over time, retail bank customers tend to increase their holding of the other products
from across the range of financial products / services available.
2. Long-term customers are more likely to become a referral source.
3. The longer a relationship continues; the better a bank can understand the customer
and his/her needs & preferences, and so greater the opportunity to tailor products and
services and cross-sell the product / service range.
4. Customers in long-term relationships are more comfortable with the service, the
organization, methods and procedures. This helps reduce operating cost and costs
arising out of customer error. With increased number of banks, products and services
and practically nil switching costs, customers are easily switching banks whenever they
find better services and products. Banks are finding it tough to get new customers, and
more importantly, retain existing customers.
According to a research by Reich held and Sesser in the Harvard Business Review, 5%
increase in customer retention can increase profitability by 35% in banking business,
50% in insurance and brokerage, and 125% in the consumer credit card market.
Therefore, banks are now stressing on retaining customers and increasing market
share.

Private Banking and CRM

32

Private Banks have traditionally viewed themselves as exceedingly 'Customer Centric'

offering what they believe to be highly personalized services to the High Net Worth
Customers. However, changes in the customer behavior and accumulation of wealth are
resulting in the needs of HNW customers becoming more diverse and complex in terms
of the sorts of products they want, the channels through which they want to access
them and the associated range of advice.
The wealthier the customers, the more demanding they are - and the clients expect
more and more from their banks. Competition for "Supremely elite" is increasing.

Customer Experience
The first step towards successfully winning, retaining and growing the profitability of
private banking customers is to understand what their wants and needs are, so that the
organization can be built around serving those needs. Only when an organization has
done this and incorporated this into its strategy can it start to design its value
proposition and a customer experience that will enable it to achieve a differentiated
competitive position in the private banking market, and more importantly, do so in an
economically viable way.
The Basic Customer Experience
There is a basic 'generic' customer experience that many private banking customers are
seeking. To be a credible player in the market, a private bank must be able to deliver
this 'base' experience. Therefore, the private bank must have the capabilities required to
meet these needs for the majority of its customer base. All customers, regardless of
wealth levels, have similar emotional needs, which drive their need for advice and their
purchase of products. Different wealth levels impose different priorities on meeting
these needs and open up new avenues for doing so. Take a simple example, HNW
customers can afford on it to fund their retirement, so their priorities may be associated
33

with growing wealth, rather than preserving it, allowing them to choose a product option
with a higher risk/reward ratio.

If this is true, it means all HNW customers start with a basic, common set of what they
want and need from a bank, which might include: 1. Personal, long-term relationship
2. Advice combining industry expertise and knowledge of personal circumstances
3. High quality, consistent quality
4. Security, privacy, confidentiality
At this basic level, grouping together these core wants and needs produces a set of
generic characteristics that an HNW individual seeks from an organization before he or
she will even consider placing any of his or her wealth with it.
Underlying these generic characteristics is a set of capabilities covering organization,
process and technology, which the private bank must process to operate in the high net
worth market.
34

Challenges in Customer Relationship Management

It is indisputable that customers are the number-one asset for most companies. Without them
there would be no sales, and so eventually no business. The idea behind customer relationship
management (CRM) was to manage customer relationships in a personalized manner, across
the enterprise and throughout the lifetime of the customer. However the picture is not as rosy as
it seems to be. In truth, though, the manner in which many businesses operate, as a collection
of separate business units with the associated politics, often gets in the way. There are few
major stumbling blocks to realizing the CRM dream:

Multiple lines of business are involved, but processes rarely flow seamlessly across
departmental boundaries.

Departments need to share customer information, an act that can be both technically
difficult and politically sensitive.

Departments often have their own systems, and sometimes multiple versions of
systems, housing customer data that should be common across departments and
systems.

Many companies rely on their Web site to provide customers with information or to
support customer self-service, but the site often is managed by yet another
department, adding to the difficulty of keeping information up-to-date and consistent
across all the various departmental systems.

Next problem is to decide what kind of customer information is relevant and how it
will be used.

Customers retention often poses another difficulty. A study by Mookherjee, A and

Shainesh, G., 2000 indicate that In competitive markets even satisfied customers
switch or defect to competitors offers. Since profitable customers are more loyal for any
35

organization there is a need to identify better predictors of loyalty. Indicators of

relationship strength like trust, satisfaction and commitment are better predictors of
loyalty. By including these parameters in building CRM managers can develop a
system with a focus on customer loyalty.
For CRM to work, companies must bring together a number of disparate processes,
systems and types of data, regardless of where they reside, to deliver an integrated,
unified view of the customer that drives a consistent approach to interactions that is
proactive as well as reactive. One of the most common tactical ways of overcoming this
issue is to implement a centralized data warehouse. The key is strong business
intelligence (BI) focusing on customer information. Once this exists, customer
information, wherever it resides, will be available for analysis to provide insights and
guide interactions across the enterprise. Further for any CRM initiative to be truly
effective, an organization must convince its staff that change is good and that CRM will
benefit them. Then it must analyze its business processes to decide which need to be
reengineered and how best to go about it. A team of carefully selected executives must
choose the right technology to automate what it is that needs to be automated. This
process, depending upon the size of the company and the breadth of data, can take
anywhere from a few weeks to a year or month.

36

CHAPTER - 3
RESEARCH METHODOLOGY

37

RESEARCH DESIGN & METHODOLOGY

PROJECT TITLE: -Customer Relationship Management in STATE BANK OF
INDIA

TYPE OF RESEARCH: - Descriptive Research

Blend of Descriptive method has been used in this research for the collection of
data. As the research is related to the study of consumer satisfaction, which can
more effectively be studied through direct questions, personal interview and informal
talks- experimental research will not much effective. Also, considering the time
constraints, descriptive research leading to conclusive result is the most suitable
design for this research as it is related to why anything happening. It checks the
behavior features of a customer.

DATA COLLECTION METHOD:

Primary Data:-Questionnaire Method
The data has been collected through questionnaire method. The questionnaire was
designed in such a way to cover as many aspects of consumer behavior as possible.
Many questions have been asked in it for feedback from customers. In it both
opened ended questions and close ended questions have been asked for study.

Secondary Data:Under this data is taken from the internet. All the data related to its profile, mission
and capital structure is taken. Even data related to this study is also taken from the
book which is sent to banks manager annually and also quarterly related to its
management, mission and many other things.
38

SAMPLE DESIGN: - Random Sampling

SAMPLE SIZE: - 100
SAMPLE UNIT: - Individual
GEOGRAPHICAL LOCATION: - Bikaner
STATISTICAL TECHNIQUES USED: Percentage Analysis

39

CHAPTER - 4
ANALYSIS AND INTERPRETATION

40

Ques :1 since when are you availing the services of SBI?

YEARS
PERCENTAGE
36

Less than 1 yr
1-3 yr

34

More than 3 yr

30

INTERPRETATION:The data given above clearly explain itself that the SBI bank is performing very well.
As the percentage of new customers is increasing every year from 30 to 34 and 36
percentage, which is quite satisfactory, as in the presence of other public and private
banks which are attracting the customers with new methods.
Ques:2 Which type of services are you availing at present?

SERVICES
Current a/c

PERCENTAGE
12

Saving a/c

91

Fixed Deposit

22

Mutual Funds

Others

0
41

INTERPRETATION:As per the research, the data collected shows that the percentage of the saving
account is the highest as compared to other accounts. The business class account
i.e. current account is having 12 percent which is low and the percentage of the fixed
deposits is 22 i.e. satisfactory and the mutual fund investors ratio is 7 i.e. because
of the low interest of people in mutual funds and prefer old investment methods.

Ques:3 Are you satisfied with the services offered by bank staff?

RESPONSE
PERCENTAGE
88
Yes
31
No
42

INTERPRETATION:The research shows that the dealings and behavior of the staff members are up to
mark and generally customers are satisfied. Few of the customers says no as they
are facing some problems due to more work load on staff and having less time to
deal with them.

Ques: 4 if yes, what are the various factors on which you are satisfied?

FACTORS
PERCENTAGE
73

Co-operative Behavior
Less Time Consuming

30

Provide Valuable Information

23

Others

43

INTERPRETATION:The ratio of the satisfactory customers is quite good and the customers are happy
with the cooperative behavior of the staff. Due to the competent staff members the
work performance is quick and efficient and so they take less time to resolve
quarries of customers and provide valuable information to them.

Ques: 5 if no, what are the various factors on which you are not satisfied?

FACTORS

PERCENTAGE

Less Co-operative

14

Behavior
More Time Consuming

18

Doesnt Provide Any other

11

Valuable Information
Others

44

INTERPRETATION:As the coin has 2 sides similar some of the customers are also there who are
dissatisfied with the dealings of the staff. In their opinion the staff members behavior
is not cooperative and they also take more time to resolve their problems.

Ques: 6 In addition to SBI Bank, which Banks services currently you are availing?

BANKS

PERCENTAGE

Kodak Mahindra

14

OBC

PNB

15

HDFC

26
45

Others

18

None

18

PERCENTAGE
Kotak Mahindra
14

18

OBC
9

18

PNB
HDFC

15
Others
26

None

INTERPRETATION:As the business needs cant be satisfied with availing the services of one bank, so
the customers are also having the accounts in other banks. Most of the customers
are having the services of HDFC bank in addition to SBI (state bank of India) almost
all banks branches are there in DELHI, so the customers are having their accounts
in PNB, Kodak Mahindra, OBC, and others.
Ques: 7 What is prompting to you not avail the services of only SBI Bank?

REASON

PERCENTAGE

Not do fast processing

11

Strict Requirements

28

More emphasis to Private Sector

25

Banks
46

Others

16

Didnt Specify

29

INTERPRETATION:As one bank cannot fulfill all business requirements, so on the question of using
other banks facilities are, most of the customers thinks that the requirements of the
SBI Bank is very strict. Next reason is, many customers are gaining faith on Private
sector banks. Very few are dissatisfied due to slow processing; many other
customers didnt specify particular reason due to personal problems.

. Ques: 8 Are you aware of the various services offered by the SBI Bank?
RESPONSE
PERCENTAGE
50

Yes
No

34

Cant say

16
47

INTERPRETATION:The awareness of the customers of SBI Bank is quite well. As per survey many
customers are fully aware about all services and many of them are not having full
information as due to lack of personal interest and some has not given the answer to
this question.

48

INTERPRETATION:On the question of the recommendation,48% customers say that this bank should
provide services equal to private bank. 44% customers say that they are facing
problems due to poor infrastructure, so intention should be given to this aspect.41%
customers say that the bank should improve net banking. 16% customers feel that
the customer dealing time is less, so Banking Hours should increased.

Ques:9 Tick the following which services are you aware of?

DIRECT BANKING FACILITIES

PERCENTAGE
39

E-Banking
37
Phone Banking
20
Money Transfer
49

77
Facilities through ATM
9
Didnt specify

Ques: 10 What are the various problems that you come to face while dealing with
Bank?

PROBLEMS

PERCENTAGE

ATM is not

10

working
Long queues at

34

teller counter
Taking more time
to resolve the

Ques: 11 What would you

20

recommend to improve

queries
Rigid

SBI Banks services

further?

15

requirements
RECOMMENDATIONS
Less
customer

8 PERCENTAGE
16

dealing time
Increase customer dealing time
Cheque is not
Improvement in Infrastructure
credited to a/c

Improve Net Banking

Didnt specify

17

44
41
48

Provide Services equal to private

sector bank
18
Others
50

5
Didnt Specify

51

CHAPTER - 5
SWOT ANALYSIS

52

SWOT ANALYSIS OF SBI BANK

SWOT Analysis:-SWOT Analysis is mainly to see what are the various strength,
weakness, opportunities and threats of the organization. As we know that every
organization is specialize in one field and weak in other field. No one organization can
be specializing in every field because it is beyond its scope. If every organization will be
specialize in every field then there will not be any competition between various
organizations and it will not have fear of lose the business to other organizations. So
this analysis is given as follow:

STRENGTHS: Main strength of this bank is, it is the largest bank of the INDIA, it has wide
network of branches and ATM overall pan INDIA.
Less charges are taken from the customers for providing the services. Most of
customers are happy due to this complaint of this.
This bank also keeps that type of customers which are of low profitability. It
believes not only in profit which is main aim of every organization. It is also
perform social responsibility.
This bank has monopoly in most of fields as it provide clearance house, come
most important after RBI, provide loans to the poorest farmers and needing
persons.
It has seven subsidiary banks; all of these capture more market growth rate by
more synergy.
53

WEAKNESS: First weakness of this branch is ,it doesnt issue the memo immediately if any
one work
is not perform in time or any one come late. No one take responsibility on his
shoulder .
High networking technology is used in some branches. All branches are not
computerized and high security softwares are not used.
Daily performance chart of the organization doesnt come on the computer of
every employee as in private sector bank. Even performance of the employee
also doesnt come.

No incentives are given to the employees for motivating them. Even the
incentive is also not fixed for the employee who has operation work. Only they
have to perform customers work.
High discipline is not used in the branch as it is requirement of every
organization. No organization can exist in this competitive environment without it.
In this bank, account is open with minimum of Rs.1,000. Some low class person
cannot manage this amount in initial stage.
Every employee in this branch is overloaded with work. The work distributed is
more than working capacity of the employee.

54

 This bank spends less on basic facilities what I have found that are very old ATM
which mostly remain out of work, no sitting and standing arrangement
etc.

OPPORTUNITIES:
It can increase its network more as good response is coming as customer base
is increasing; it means people are ready to take services of this bank.
It can relax some of its internal rules to catch more customers. Many other banks
have not rules which this bank has put in ahead of customers.
From the customer feedback it is found that its customers have mainly saving,
current accounts and fixed deposits. Its customers have no insurance policy of its
bank, less awareness of mutual fund. These customers should be provided full
knowledge about its all products. As this banks customer base is increasing,
knowledge of all products should be given.
It can open branches in foreign also as many of its customers are NRIs. It has
tied up with other banks in foreign to handle the foreign transactions.

THREATS: New banks are coming in INDIA. This will increase the competition and this has
to consecrate on its marketing activities.
New banks are giving relaxations to its customers. So it will have to change its
rules.
55

 New banks are poaching the employees of this branch. So this bank has to retain
its employees with it.
New banks are spending more to capture the more customers so this bank will
have to change its policy of less spending or it will have to find new mean to
retain its customers with it.

56

CHAPTER 6
FINDING
AND
CONCLUSION

57

FINDINGS

In Delhi, there are number of banks, despite of the tough competition, the
number of the new customers of SBI Bank are increasing every year.

91% customers are having their savings account. The current account user are
very less while percentage of the fixed deposits is 22.

88% customers are satisfied with the Banks services and Behavior and only
31% are dissatisfied with the Banks performance.

Most of the customers are happily satisfied with the staffs cooperative behavior.
They are satisfied with the fast processing of transaction as they take less time.
They get valuable information at time.

Very few people are dissatisfied because of more time consuming transaction
and less cooperative behavior.

26% of the SBI Banks customer are having their account in HDFC,15% in
PNB,14% in kotak mahindra etc. which shows that the user of the HDFC is
highest.

28% respondent says that they have account in other bank due to strict
requirement, 25% are saying that they give more importance to private sector
banks. 29% doesnt specify the reason.

The awareness about the various services is quite good but not satisfactory as
50% customers are aware about the various services of the bank, 34% are not
aware about the services and 16% respondents answer to cant say.

58

The user of the ATM is the highest and the use of the net banking and phone
banking is the second highest, while the knowledge about the money transfer is
very less among the customers.

Some Customers are having problems with the banks working conditions as
34% customers said that there are long queues at teller counter, 20% said staff
take more time to resolve queries, 15% said about strict requirement and many
others reasons.

44% of the customers require improvement in infrastructure and 48% customers

want that SBI should also provide services equal to private banks. While 41%
customers want improvement in e-banking service. 18% doesnt specify

Conclusion
Banking can be mysterious for consumers and how they interact with their finances can
be a complex matter. The challenges faced by banks and their customers are many but
the trick lies in de-mystifying complex financial relationships.Technical solutions
deployed by banks today are flexible, user-friendly and meant to facilitate specific
workflow and requirements in implementation processes. In order to simplify lives,
banks have begun to implement end-to-end technologies through all departments with
the intention of removing human error from processes. Previously existing manual
environments could not have been adequate for future visions, growth plans and
strategies.

59

In this day and age, customers enjoy complete luxury in terms of customized technical
solutions and banks use the same to cement long-term, mutually-beneficial
relationships. From above complete analysis, this is clear. So at the last we can say that
SBI bank has good scope in future and try to compete with the private sector banks.

CHAPTER - 7
RECOMNDATION
AND
SUGGESTION

60

RECOMMENDATION AND SUGGESTION

The research shows that the teller is the most crowded counter and always
having long queues, so teller should be increased.
Bank should also have to improve its infrastructure as customers feel
inconvenience in sitting and standing.
As e- commerce is going on increasing, many customers want this bank improve
net banking more.
Customers say that may be this public bank does not services more than private
banks but it can try to provide services as equal.
Some customers have also strongly recommended that the number of branches
of bank should be increased in DELHI.

Pay attention for a long time to only one customer with whom staff is dealing, as
other customers are also waiting and staff should understand we should not
waste other customers valuable time.

Banking hours should be increased .as the bank close the customers visit by
3:30p.m. Which is very incontinent to the customers?
61

 As the cheque is not cleared in time due to lack of attention. So staff should pay
proper care that cheque should be credited in customers a/c in time.
Bank should decrease its AQBs non maintenance charges.

ANNEXURE

62

QUESTIONNAIRE
Dear Respondent,
The purpose of this project is to assess the effectiveness of Customer Relationship
Management (CRM) Practices adopted by State Bank of India. Please answer the
following questions. Needless to say, your response would be treated confidential and
would be used only for the purpose of study.
Name : -

Account No :-

Age : -

City : - ..

Q: 1 Since when are you availing the services of SBI?

< 1 yr

1- 3 yr

> 3 yr

Q: 2 Which type of services are you availing at present?

Current a/c

Saving a/c
63

Fixed deposit

Mutual Fund

If any other, specify.

Q: 3 Are you satisfied with the services offered by the bank staff ?
Yes

No

Q: 4 If yes, what are the various factors on which you are satisfied?
Co-operative Behavior

Less Time Consuming

Provide Valuable Information

Others

Q: 5 If no, what are the various factors on which you are not satisfied?
Less Co-operative Behavior

More Time Consuming

Doesnt Provide Any Other Valuable Information

If any other, specify.
Q: 7 In addition to SBI Bank, which Banks services currently you are availing?
Kotak Mahindra

OBC

PNB

HDFC

None

If any other, specify.

Q: 8 what is prompting to you not avail the services of only SBI Bank?
Not do fast processing

Strict Requirements

More emphasis to Private Sector Banks

64

Others

Q: 9 Are you aware of the various services offered by the SBI Bank?
Yes

No

Can not say

Q: 11 Tick the following which services are you aware of?

E- Banking
Money Transfer

Phone Banking
Facilities through ATM (like mini statement,)

Q: 12 What are the various problems that you come to face while dealing with Bank?
ATM is not working

rigid requirements

Long queues at teller counter

fewer customers dealing time

Cheque is not credited to a/c

taking more time

If any other please specify

1).

2)

65

BIBLIOGRAPHY

66

BIBLIOGRAPHY

Berry, L. L. (1983). Relationship Marketing. In L.L. Berry, G.L. Shostack, & G.D.

Dpah (Eds.), Emerging Perspectives on Service Marketing (pp. 28-38). American

Marketing Association.

Gronroos, C., From Marketing Mix to Relationship Marketing: Towards the

Paradigm Shift in Marketing, Management Decision, no. 32(2), 1998, pp. 4-20.
Shainesh,G. and Sheth, J.N. (2006): Customer Relationship Perspective: A Strategic
Perspective, Macmillan India Ltd..
Sheth, J.N. and Parvatiyar(2000): A., Handbook of Relationship Marketing, Thousand
Oaks, California: Sage Publications

www.crm2day.com
www.crmguru.com

67

68