Comparative Study of Customer Satisfaction in Public Sector and Private Sector Banks in India

Abstract

With the introduction of liberalization policy and RBI's easy norms, several private and foreign banks have entered the Indian banking sector giving birth to cut throat competition amongst banks to acquire large customer base and market share. Banks have to deal with many customers and render them various types of services. If the customers are not satisfied with the services provided by the banks then they will defect which will impact the economy as a whole since banking system plays an important role in the economy of a country. Also, it is very costly and difficult to appease an unsatisfied customer.

Since the competition has grown manifold in the recent times, it has become a herculean task for organizations to build loyalty; the reason being today's customer is spoilt for choice. It has become imperative for both public and private sector banks to perform to the best of their abilities to retain their customers by catering to their explicit as well as implicit needs. Many a times it happens that banks fail to satisfy their customer; something that can cause huge losses for banks and so, the need for this study arises.

The purpose of this research article is to examine the customer satisfaction among a group of customers towards the public sector&private sector banking industries in India. This study is cross sectional and descriptive in nature. The researcher tries to makes an effort to clarify the Customer Service satisfaction in Indian banking Sector. Descriptive research design is used for this study, where the data is collected through a questionnaire. The information is gathered from the different customers of the two banks, viz., PNB and HDFC Bank located in the Meerut Region, Uttar Pradesh. A hundred bank respondents from each bank were contacted personally in order to seek fair and frank responses on quality of service in banks. The service quality model developed by Zeithamal, Parsuraman and Berry (1988) has been used in the present study.

The analysis clearly shows that there exists a wide perceptual difference among Indian (public sector) banks regarding overall service quality with their respective customers, when compared to Private sector banks. The said perceptual difference in private banks is narrow.