My original projects of rm (autosaved)

2014-16
A COMPARATIVE STUDY BETWEEN PRIVATE
SECTOR BANKS AND PUBLIC SECTOR BANKS
ANKIT SHAH
ARPAN SHROFF
CHIRAG ZALA
JAYANT RAJPUT
RAHUL JAIN
ER. MEHUL SINH RAJPUT

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DECLARATION:-
Title: A Comparative Study between Private Sector Banks and Public Sector Banks.
Degree for which the Thesis is submitted: Master of Business Administration
We declare that the presented thesis represents largely our own ideas and work in our own
words. Where others ideas or words have been included, we have adequately cited and listed
in the reference materials. The thesis has been prepared without resorting to plagiarism. We
have adhered to all principles of academic honesty and integrity. No falsified or fabricated
data have been presented in the thesis. We understand that any violation of the above will
cause for disciplinary action by the Institute, including revoking the conferred degree, if
conferred, and can also evoke penal action from the sources which have not been properly
cited or from whom proper permission has not been taken.
Submitted By: Submitted To:
ANKIT SHAH AMISH SONI
ARPAN SHROFF
CHIRAG ZALA
JAYANT RAJPUT
RAHUL JAIN
Er. MEHUL SINH RAJPUT

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ACKNOWLEDGEMENT:-
We take this opportunity to render our deep sense of gratitude to our professor, DIRECTOR
DR. HITESH RUPARELL Mr. AMISH SONI, Assistant Professor, Department of
Management Studies for his constant and valuable guidance in the truest sense throughout the
course of the work. It was his encouragement and support from the initial to the final level
enabled me to develop an understanding of the topic. Every time we had a problem, we
would rush to him for his advice, and he would never ever let us down. His timely
suggestions helped me to circumvent all sorts of hurdles that we had to face throughout our
work. we are deeply indebted for his motivation and guidance.. Thanks go out to all our
friends as they have always been around to provide useful suggestions, companionship and
created a peaceful research environment. We wish to acknowledge the continuous support
and blessings of our parents which made this work possible. Although they were physically
far away from us, their immense faith and wish is gratefully acknowledged. Finally we
believe this research experience will greatly benefit our career in the future.

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PREFACE
Management today is must for day-to-day life. Management is the integral part of the
business. In this world, all things need proper management for its success. Business without
proper management is like a castle of sand built on seashore. Even individuals need proper
management for running their life smoothly. Only theoretical knowledge is not enough in
MBA along with one needs some practical exposure in the corporate world also. MBA
provides this opportunity through the medium of group projects. This project has made one
thing clear that there are two pillars for getting success in business i.e. efficiency and
Effectiveness; it means not only doing right things but also doing things rightly.
In MBA Theory of any subject is important but without its practical knowledge it becomes
unless particularly for the Management Students. As a students of the Business
Administration, we have studied many theories and concepts in the classroom, but only after
taking up this project work we have experienced & understood these Management theories
&practices in its fullest sense, which plays a very vital role in business field today. The
knowledge of management is incomplete without knowing the practical application of the
theories studied. This project report gives knowledge of difference between public or
private sector bank.. This project has brought positive changes in our lifes & career. The
Project gave us a lot exposure which will be helpful to us for the rest of the MBA curriculum.
We consider ourselves fortunate enough for getting guidance from one of the best banks at a
very important stage of my career.

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EXECUTIVE SUMMARY :-
 The objective of the study is to have a comparative study of the PSU Banks and Private Sector Banks
in Semi urban areas and also to find out the most preferred Banking Sector among them.
 For the above study a questionnaire was designed and the same was provided to the respondents for
their valuable inputs. Some of the inputs were taken from Qualtrics Survey Software and others were
provided in the form of hard copies.
 All the aspects of the study included introduction of the study, objective of the study, research
methodology, literature review, data interpretation and analysis, findings, suggestions and
recommendations.
 The study suggests that in this part of the country the Public Sector Banks are ahead of the Private
Sector Banks. The main reasons according to our study are the trust and reliability factor (DICGC
assurance on deposits) and the location of the branch (Financial Inclusion policy of Reserve Bank of
India)
 The data collection of the study was mainly taken from primary source i.e. Questionnaire and
secondary sources of the data i.e. internet and Kiran Prakashan Books and Arihant Books AND 10
days of MBA.

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INDEX
Sr. No particular page no
RESEARCH METHODOLOGY
Chapter 1 Research proposal
Objective of study
Statement of problem
Literature review
Sample design
Data collection
Primary data
Secondary data
Sample plan
Sample size
Sample unit
Sample unit
Sample technique
Sample description
THE BANKING INDUSTRY IN INDIA
Chapter 2 Introduction of banking
Banks overview
History of banks
Public sector banks
Private sector banks
DATA ANALYSIS
Chapter 3 Analysis of the banks
Two variables
Hypothesis
Hypothesis –Chi -Square
Chapter 4 Finding of the study
Finding respects of the objective

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INDEX
Chapter 5 suggestion
Chapter 6 recommendation
Chapter 7 conclusion
Chapter 8 annexure
Chapter 9 bibliography
FIGURES AND CHARTS
Fig 1 Business of banking
Fig 2 Function of banking
Fig 3 Banking system
Fig 4 All banks account
Fig 5 Public and private difference
Fig 6 Sector preference
Fig 7 Preferred bank
Fig 8 Transaction in bank
Fig 9 Service provider by bank
Fig 10 Different charges time of transaction
Fig 11 Bank efficiency
Fig 12 Satisfaction level with the bank

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Tables
Table 1 Statics
Table 2 Bank account details
Table 3 Statics
Table 4 Bank public and private
Table 5 Statics
Table 6 Bank account prefer
Table 7 Statics
Table 8 Bank account maintain
Table 9 Performance
Table 10 Facilities provider
Table 11 Types of service provider
Table 12 Statics
Table 13 Bank levy the charges
Table 14 Overall efficiency
Table 15 Statics
Table 16 Decision about transaction
Table 17 Statics
Table 18 Satisfaction level
Table 19 Statics
Table 20 Service provider
Table 21 Improve facilities
Table 22 Statics
Tables 23 Change the sector
Tables 24 Hypothesis
Table 25 Chi-square test

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Chapter 1
RESEARCH METHODOLOGY
OBJECTIVE OF THE STUDY
This study has been conducted with a variety of important objectives in mind. The
following provides us with the chief objectives that have tried to achieve through the study.
The extent to which these objectives have been met could judged from the conclusions and
suggestions, which appear in the later of this study.
The Chief Objectives of this study are:-
1. To find the banking sector largely preferred by the customers.
2. To find out the factors which influence the customers to choose a bank.
3. To study the problems faced by the customers in public as well as private
sector banks and also to compare between them.
STATEMENT OF PROBLEM-The
“expectations” of customers influence their buying behaviour. The customers
relate this expectation to the quality of service provided by the banks. The level of
expectation differs from person to person but everyone wants the banks to provide the
products and services which can satisfy their needs up to their expected level or to a higher
level so as to offer them a higher satisfaction. The level of satisfaction of customers is
affected by some other attributes also other than the quality of service such as their
experience with the bank employees etc. As there is a huge competition in the banking sector
in India, the customer satisfaction is an important factor in the success of the banks. So with
this background an attempt has been made to study the satisfaction of the customers of
various banks taking into consideration some important attributes which customers consider
for rating their satisfaction with a particular bank.

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LITERATURE REVIEW:-
A literature review provides an overview and a critical evaluation of a body of
literature relating to a research topic or a research problem. It analyses a body of literature in
order to classify it by themes or categories, rather than simply discussing individual works
one after the other. A literature review often forms part of a larger research project such as
within a thesis, or it may be an independent written work, such as a synthesis written paper.
PURPOSE OF A LITERATURE REVIEW -
A literature review situates our topic in relation to previous researches and illuminates a
spot for our research. It accomplishes several goals –
 Provides background for topic using previous research.
 Shows we are familiar with previous, relevant research.
 Evaluates the depth and breadth of the research with regards to our topic.
 Determines relating questions or aspects of our topic in need of research.
In our research the main source of information has been the questionnaire filled up by the
respondents as well as the internet. The topic of our research “comparative study of the PSU
banks and private banks.” has not been published earlier. So the main argument of the topic
whether PSU banks or private banks rule has been the main focus. The internet, questionnaire
served by us to the respondents, website of particular banks has been the major source of
information. Few worth literatures like Kiranprakashan bank books, Arihants banking
knowledge have been very valuable.
 PRASHANTA ATHMA (2000):-
In his Ph D research submitted at Usmania University Hyderabad, “Performance of
Public Sector Banks – A Case Study of State Bank of Hyderabad, made an attempt to
evaluate the performance of Public Sector Commercial Banks with special emphasis on State
Bank of Hyderabad. The period of the study for evaluation of performance is from 1980 to
1993-94, a little more than a decade. In this study, Athma outlined the Growth and Progress
of Commercial Banking in India and. analyzed the trends in deposits, various components of
profits of SBH, examined the trends in Asset structure, evaluated the level of customer
satisfaction and compared the performance of SBH with other PSBs, Associate Banks of SBI
and SBI. Statistical techniques like Ratios, Percentages, Compound Annual rate of growth
and averages are computed for the purpose of meaningful comparison and analysis. The
major findings of this study are that since nationalization, the progress of banking in India has

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been very impressive. All three types of Deposits have continuously grown during the study
period, though the rate of growth was highest in fixed deposits. A comparison of SBH
performance in respect of resource mobilization with other banks showed that the average
growth of deposits of SBH is higher than any other bank group. Profits of SBH showed an
increasing trend indicating a more than proportionate increase in spread than in burden.
Finally, majority of the customers have given a very positive opinion about the various
statements relating to counter service offered by SBH.
 ZACHARIAS THOMAS(1997):-
Ph D Thesis, ‘Performance effectiveness of Nationalised Bank- A Case Study of
Syndicate Bank’, submitted to Kochin University (1997), Thesis studied the performance
effectiveness of Nationalized Bank by taking Syndicate Bank as case study in his Ph.D thesis.
Thomas has examined various aspects like growth and development of banking industry,
achievements of Syndicate Bank in relation to capital adequacy, quality of assets,
Profitability, Social Banking, Growth, Productivity, Customer Service and also made a
comparative analysis of 'the performance effectiveness of Syndicate Bank in relation to
Nationalized bank. A period of ten years from 1984 to 1993-94 is taken for the study. This
study is undertaken to review and analyze the performance effectiveness of Syndicate Bank
and other Nationalized banks in India using an Economic Managerial efficiency Evaluation
Model (EMEE Model) developed by researcher. Thomas in this study found that Syndicate
Bank got 5th Position in Capital adequacy and quality of assets, 15th in Profitability, 14th
Position in Social Banking, 8thin Growth, 7th in Productivity and 15th position in Customer
Service among the nationalized banks. Further, he found that five nationalized banks showed
low health performance, seven low priority performance and eleven low efficiency
performance in comparison with Syndicate Bank.
 SINGH R (2003):-
In his paper Profitability management in banks under deregulate environment, IBA
bulletin, No25, has analyzed profitability management of banks under the deregulated
environment with some financial parameters of the major four bank groups i.e. public sector
banks, old private sector banks, new private sector banks and foreign banks, profitability has
declined in the deregulated environment. He emphasized to make the banking sector
competitive in the deregulated environment. They should prefer noninterest income sources.

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 JHA AND SARANGI (2011) :-
Analyzed the performance of seven public sector and private sector banks for the year
2009-10. They used three sets of ratios, operating performance ratios, financial ratios, and
efficiency ratios. In all eleven ratios were used. They found that Axis Bank took the first
position, followed ICICI Bank, BOI, PNB, SBI, IDBI, and HDFC, in that order.
 DANGWAL AND KAPOOR (2010):-
Evaluated the financial performance of nationalized banks in India and assessed the
growth index value of various parameters through overall profitability indices. The data for
19 nationalized banks, for the post-reform period from 2002-03 to 2006-07, was used to
calculate the index of spread ratios, burden ratios, and profitability ratios. They found that
while four banks had excellent performance, five achieved good performance, four attained
fair performance, and six had poor performance.
 SHARMA (2010):-
Assessed the bank failure resolution mechanism to analyze the powers given by the
countries to their regulators to carry out resolution of failed banks among 148 countries
during 2003. She used 12 variables for correlation and regression analysis. Her study
revealed that the countries which had faced systemic crisis were more prone to providing
liquidation powers to their regulators. These countries had a tendency to protect their
regulators through immunity, rather than any legal action. Systemic crisis did not
significantly influence the regulators’ powers for the restructuring of the banks.
 PAT (2009):-
Made an assessment of the RBI’s Report on “Trend and Progress of Banking’ in India,
2007-08, which reported a relatively-healthy position of the Indian banking system. He noted
that the various groups of banks reported improvements in net profits, return on assets and
return on equity. Two basic indicators of sound banking system, namely, capital to risk
weighted assets and quality of assets, also revealed considerable improvements over the year.
 SINGLA HK (2008):-
In his paper,’ financial performance of banks in India,’ in ICFAI Journal of Bank
Management No 7, has examined that how financial management plays a crucial role in the
growth of banking. It is concerned with examining the profitability position of the selected
sixteen banks of banker index for a period of six years (2001-06). The study reveals that the
profitability position was reasonable during the period of study when compared with the
previous years. Strong capital position and balance sheet place, Banks in better position to
deal with and absorb the economic constant over a period of time.

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 JOSHI VIJAYA (2007) :-
Observed that on the eve of banking reforms Indian Banking Sector was financially
unsound, unprofitable and inefficient. They made a critical examination of the changes that
have taken place in the banking sector after reforms. Further, what remains to be done with
respect of pre-emption of bank resources, directed credit, deregulation of interest rates, etc.
in the field of banking sector were also elaborately discussed.
 Qamar (2003) :-
Identified the differences in terms of endowment factor, risk factor, revenue
diversification, profitability, and efficiency that might have existed among 100 scheduled
commercial banks, divided into three groups for the year 2000-2001. His study revealed that
the public sector banks were better endowed in terms of their assets base, share capital and
shareholders equity than other banks, whereas foreign banks and old private sector banks
operated at a very high capitalization ratio.
 Joshi Vijaya (2007) :-
Observed that on the eve of banking reforms Indian Banking Sector was financially
unsound, unprofitable and inefficient. They made a critical examination of the changes
that have taken place in the banking sector after reforms. Further, what remains to be
done with respect of pre-emption of bank resources, directed credit, deregulation of
interest rates, etc. in the field of banking sector were also elaborately discussed.
 Muniappan (2002):-
Studied paradigm shift in banks from a regulator point of view in Indian Banking :
Paradigm Shift, IBA Bulletin, No 24 -3. He concluded the positive effect of banking
sector reforms on the performance of banks. He suggested many effective measures to
strengthen the Indian banking system. The reduction of NPAs, more provisions for
standards of the banks, IT, sound capital bare are the positive measures for a paradigm
shift. A regulatory change is required in the Indian banking system.

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Research is an art of scientific investigation. In other words research is a scientific
and systematic search for pertinent information on a specific topic. The logic behind taking
research methodology into consideration is that one can have knowledge regarding the
method and procedure adopted for achievements of objective of the project. With the
adoption of this others can also evaluate the results too.
The methodology adopted for studying the objective of the project was surveying the
bank account holders of the Semi urban areas. So keeping in view the nature of requirement
of the study to collect all the relevant information regarding the comparison of public sector
banks and the private sector banks direct personal interview method with the help of
structured questionnaire was adopted for collection of primary data.
Secondary data has been collected through the various magazines and newspaper and
by surfing on internet and also by visiting the websites of Indian Banking Association.
SAMPLE DESIGN:- A sample design is a definite plan for obtaining a sample from a given
population. It refers to the techniques or the procedures that the researchers would adopt in
selecting items for the samples. Sample design may as well lay down the number of items to
be included in the sample i.e. the size of the sample. Sample design is determine before data
are collected. Here we select the population as sample in our sample design. The selected
respondents should be as representatives of the total population.
POPULATION:- The persons holding bank accounts in the semi urban areas were taken into
consideration.
DATA COLLECTION:- Data was collected by using two main methods i.e. primary data
and secondary data.
PRIMARY DATA:- primary data is the data which is used or collected for the first time and
it is not used by anyone in the past. There are number of sources of primary data from which
the information can be collected. We took the following resources for our research.
a) QUESTIONNAIRE:- This method of data collection is quite popular, particularly in case
of big enquiries. Here in our research we set 15 simple questions and requested the
respondents to answer these questions with correct information.
SECONDARY DATA:- Secondary data is the data which is available in readymade form
and which has already been used by other people for various purposes.

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SAMPLE PLAN:-
SAMPLE SIZE:- Keeping in mind all the constraints the size of the sample of our study was
selected as 100.
SAMPLING UNIT:- State bank of India, Due to nature of study we also visited various
branches of SBI, UBI, ICICI, AXIS.
SAMPLING TECHNIQUE:- Stratified convenient sampling. All the bank account holders
were taken into considerations. Research was conducted on clear assumptions that the
respondents would give frank and fair answer in a pragmatic way without any bias.
SAMPLING DESCRIPTION:- In order to understand the nature and characteristics of
various respondents in this study, the information was collected and analyzed according to
their socio - economic background like education, occupation, age, gender, place of domicile
etc .This descriptions show that these respondents that have been included in the study belong
to different background and this in turn enhances the capability and accuracy of the study.

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Chapter | 3
INTRODUCTION TO BANKING:-
Bank is defined in many ways by various authors in the book son economics and
commerce. It is very difficult to define a bank; because a bank performs multifarious
functions may be defined in many ways according to their functions. The evolution of
different types of banks, each specializing in a particular field, gives emphasis on each and
every kind of bank. A general and comprehensive definition to cover all types of banking
institutions would be unscientific and probably impossible. Each type of bank should have its
own definition, explaining its specialized functions. Legislators have understood this
difficulty and that is why the bill of exchange Act 1882 (England) defines “A bank includes a
body of persons, whether incorporated or not, who carry on the business of banking” From
this definition it is clear to us that any institution, which performs the various banking
functions, may be termed as bank. But in practice it is found that many banking functions
wary from time to time and country to country. It is not possible on the part of a single bank
to perform all the banking functions at a time. So there originated numbers of specialized
banks with the objective of performing one or more functions. As for example, Central Bank,
Commercial bank, Industrial Bank, Agricultural Bank, Co-operative Bank etc., are seen in the
practical field.Dr. Herbert L. Hart has defined a banker as “A banker is one who in the
ordinary course of business honours cheques drawn upon him by persons for whom he
receives money on current account “According to Sir John Paget “No one and nobody
corporate and otherwise can be a banker who does not (i) take deposit accounts (ii) take
current accounts (iii) issue and pay cheques drawn upon him(iv) collect cheques crossed and
uncrossed for his customers “Hilton banking commission defines bank or banker as “Every
person, firm or company using in the description or its title, bank or banker or banking and
accepting deposits of money subject to withdrawal by cheque, draft or order”In view of the
above definitions, a simple and short definition can be given as “Bank is an institution, which
deals in money and credit “According to this precise definition a bank accepts deposits from
public and makes advances and loans to them. In practice bank receives deposits of money in
savings and current accounts at lower rate of interest or profit and gives on credit to needy
persons and businessmen at a higher rate of interest or profit.

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BANKING IN INDIA:-
Banking in India in the modern sense originated in the last decades of the 18th
century. The first banks were Bank of Hindustan (1770-1829) and The General Bank of
India, established 1786 and since defunct..The largest bank, and the oldest still in existence,
is the State Bank of India, which originated in the Bank of Calcutta in June 1806, which
almost immediately became the Bank of Bengal. This was one of the three presidency banks,
the other two being the Bank of Bombay and the Bank of Madras, all three of which were
established under charters from the British East India Company. The three banks merged in
1921 to form the Imperial Bank of India, which, upon India's independence, became the
State in 1955. For many years the presidency banks acted as quasi-central banks, as did their
successors, until the Reserve Bank of India was established in 1935..In 1969 the Indian
government nationalized all the major banks that it did not already own and these have
remained under government ownership. They are run under a structure know as 'profit-making
public sector undertaking' (PSU) and are allowed to compete and operate
as commercial banks. The Indian banking sector is made up of four types of banks, as well as
the PSUs and the state banks; they have been joined since the 1990s by new private
commercial banks and a number of foreign banks.Banking in India was generally fairly
mature in terms of supply, product range and reach-even though reach in rural India and to
the poor still remains a challenge. The government has developed initiatives to address this
through the State Bank of India expanding its branch network and through the National Bank
for Agriculture and Rural Development with things like microfinance.Indian Banking
Industry currently employees 1,175,149 employees and has a total of 109,811 branches in
India and 171 branches abroad and manages an aggregate deposit of 67504.54
billion (US$1.1 trillion or €820 billion) and bank credit of 52604.59 billion (US$880 billion
or €640 billion).
HISTORY OF BANKING IN INDIA:
In ancient India there is evidence of loans from the Vedic period (beginning 1750
BC). Later during the Maurya dynasty (321 to 185 BC), an instrument called adesha was in
use, which was an order on a banker desiring him to pay the money of the note to a third
person, which corresponds to the definition of a bill of exchange as we understand it today.
During the Buddhist period, there was considerable use of these instruments. Merchants in
large towns gave letters of credit to one another.

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COLONIAL ERA:-
During the period of British rule merchants established the Union Bank of Calcutta in
1829, first as a private joint stock association, then partnership. Its proprietors were the
owners of the earlier Commercial Bank and the Calcutta Bank, who by mutual consent
created Union Bank to replace these two banks. In 1840 it established an agency at
Singapore, and closed the one at Mirzapur that it had opened in the previous year. Also in
1840 the Bank revealed that it had been the subject of a fraud by the bank's accountant.
Union Bank was incorporated in 1845 but failed in 1848, having been insolvent for some
time and having used new money from depositors to pay its dividends.
The Allahabad Bank, established in 1865 and still functioning today, is the
oldest Joint Stock bank in India, it was not the first though. That honour belongs to the Bank
of Upper India, which was established in 1863, and which survived until 1913, when it failed,
with some of its assets and liabilities being transferred to the Alliance Bank of Simla.
Foreign banks too started to appear, particularly in Calcutta, in the 1860s.
The Comptoird'Escompte de Paris opened a branch in Calcutta in 1860, and another
in Bombay in 1862; branches in Madras and Pondicherry, then a French possession,
followed. HSBC established itself in Bengal in 1869. Calcutta was the most active trading
port in India, mainly due to the trade of the British Empire, and so became a banking centre.
The first entirely Indian joint stock bank was the Oudh Commercial Bank, established in
1881 in Faizabad. It failed in 1958. The next was the Punjab National Bank, established in
Lahore in 1895, which has survived to the present and is now one of the largest banks in
India.
Around the turn of the 20th Century, the Indian economy was passing through a
relative period of stability. Around five decades had elapsed since the Indian Mutiny, and the
social, industrial and other infrastructure had improved. Indians had established small banks,
most of which served particular ethnic and religious communities.
The presidency banks dominated banking in India but there were also some exchange banks
and a number of Indian joint stock banks. All these banks operated in different segments of
the economy. The exchange banks, mostly owned by Europeans, concentrated on financing
foreign trade. Indian joint stock banks were generally undercapitalized and lacked the
experience and maturity to compete with the presidency and exchange banks. This
segmentation let Lord Curzon to observe, "In respect of banking it seems we are behind the

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times. We are like some old fashioned sailing ship, divided by solid wooden bulkheads into
separate and cumbersome compartments."
The period between 1906 and 1911, saw the establishment of banks inspired by
the Swadeshi movement. The Swadeshi movement inspired local businessmen and political
figures to found banks of and for the Indian community. A number of banks established then
have survived to the present such as Bank of India, Corporation Bank, Bank, Bank, Canara
Bank and Central Bank of India.
The fervour of Swadeshi movement lead to establishing of many private banks
in Dakshina Kannada and Udupi district which were unified earlier and known by the
name South Canara ( South Kanara ) district. Four nationalised banks started in this district
and also a leading private sector bank. Hence undivided Dakshina Kannada district is known
as "Cradle of Indian Banking".
During the First World War (1914–1918) through the end of the Second World
War (1939–1945), and two years thereafter until the independence of India were challenging
for Indian banking. The years of the First World War were turbulent, and it took its toll with
banks simply collapsing despite the Indian economy gaining indirect boost due to war-related
economic activities. At least 94 banks in India failed between 1913 and 1918 as indicated in
the following table:
Years
Number of banks
that failed
Authorised Capital
( Lakhs)
Paid-up Capital
( Lakhs)
1913 12 274 35
1914 42 710 109
1915 11 56 5
1916 13 231 4
1917 9 76 25
1918 7 209
1

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POST-INDEPENDENCE:- The partition of India in 1947 adversely impacted the
economies of Punjab and West Bengal, paralysing banking activities for months.
India's independence marked the end of a regime of the Laissez-faire for the Indian banking.
The Government of India initiated measures to play an active role in the economic life of the
nation, and the Industrial Policy Resolution adopted by the government in 1948 envisaged
a mixed economy. This resulted into greater involvement of the state in different segments of
the economy including banking and finance.
The major steps to regulate banking included: The Reserve Bank of India, India's
central banking authority, was established in April 1935, but was nationalised on 1 January
1949 under the terms of the Reserve Bank of India (Transfer to Public Ownership) Act, 1948
(RBI, 2005b).
In 1949, the Banking Regulation Act was enacted which empowered the Reserve
Bank of India (RBI) "to regulate, control, and inspect the banks in India".
IN THE 1960S:
Despite the provisions, control and regulations of the Reserve Bank of India, banks in
India except the State Bank of India (SBI), continued to be owned and operated by private
persons. By the 1960s, the Indian banking industry had become an important tool to facilitate
the development of the Indian economy. At the same time, it had emerged as a large
employer, and a debate had ensued about the nationalization of the banking industry. Indira
Gandhi, the then Prime Minister of India, expressed the intention of the Government of
India in the annual conference of the All India Congress Meeting in a paper entitled "Stray
thoughts on Bank Nationalization."[7] The meeting received the paper with enthusiasm.
Thereafter, her move was swift and sudden. The Government of India issued an ordinance
('Banking Companies (Acquisition and Transfer of Undertakings) Ordinance, 1969') and
nationalised the 14 largest commercial banks with effect from the midnight of 19 July 1969.
These banks contained 85 percent of bank deposits in the country.[7] Jayaprakash Narayan, a
national leader of India, described the step as a "masterstroke of political sagacity." Within
two weeks of the issue of the ordinance, the Parliament passed the Banking Companies
(Acquisition and Transfer of Undertaking) Bill, and it received the presidential approval on 9
August 1969.
A second dose of nationalisation of 6 more commercial banks followed in 1980. The
stated reason for the nationalisation was to give the government more control of credit

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delivery. With the second dose of nationalisation, the Government of India controlled around
91% of the banking business of India. Later on, in the year 1993, the government merged
New Bank of India with Punjab National Bank. It was the only merger between nationalised
banks and resulted in the reduction of the number of nationalised banks from 20 to 19. After
this, until the 1990s, the nationalised banks grew at a pace of around 4%, closer to the
average growth rate of the Indian economy.
LIBERALIZATION IN THE 1990s:-
In the early 1990s, the then government embarked on a policy of liberalization,
licensing a small number of private banks. These came to be known as New Generation tech-savvy
banks, and included Global Trust Bank (the first of such new generation banks to be
set up), which later amalgamated with Oriental Bank of Commerce, UTI Bank (since
renamed Axis), ICICI Bank and HDFC Bank. This move, along with the rapid growth in
the economy of India, revitalised the banking sector in India, which has seen rapid growth
with strong contribution from all the three sectors of banks, namely, government banks,
private banks and foreign banks.
The next stage for the Indian banking has been set up with the proposed relaxation in
the norms for foreign direct investment, where all foreign investors in banks may be given
voting rights which could exceed the present cap of 10% at present. It has gone up to 74%
with some restrictions.

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CURRENT PERIOD:-
All banks which are included in the Second Schedule to the Reserve Bank of India Act,
1934 are Scheduled Banks. These banks comprise Scheduled Commercial Banks and
Scheduled Co-operative Banks. Scheduled Commercial Banks in India are categorised into
five different groups according to their ownership and/or nature of operation. These bank
groups are:
 State Bank of India and its Associates
 Nationalised Banks
 Private Sector Banks
 Foreign Banks
 Regional Rural Banks.
In the bank group-wise classification, IDBI Bank Ltd. is included in Nationalised Banks.
Scheduled Co-operative Banks consist of Scheduled State Co-operative Banks and Scheduled
Urban Cooperative Banks.
By 2010, banking in India was generally fairly mature in terms of supply, product range
and reach-even though reach in rural India still remains a challenge for the private sector and
foreign banks. 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.
With the growth in the Indian economy expected to 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 be strong. One may also expect M&As,
takeovers, and asset sales.
In March 2006, the Reserve Bank of India allowed Warburg Pincus to increase its
stake in Kotak Mahindra Bank (a private sector bank) to 10%. This is the first time an
investor has been allowed to hold more than 5% in a private sector bank since the RBI
announced norms in 2005 that any stake exceeding 5% in the private sector banks would
need to be vetted by them.
In recent years critics have charged that the non-government owned banks are too
aggressive in their loan recovery efforts in connexion with housing, vehicle and personal
loans. There are press reports that the banks' loan recovery efforts have driven defaulting
borrowers to suicide.

23
ADOPTION OF BANKING TECHNOLOGY:-
The IT revolution has had a great impact on the Indian banking system. The use of
computers has led to the introduction of online banking in India. The use of computers in the
banking sector in India has increased many fold after the economic liberalisation of 1991 as
the country's banking sector has been exposed to the world's market. Indian banks were
finding it difficult to compete with the international banks in terms of customer service,
without the use of information technology.
The RBI set up a number of committees to define and co-ordinate banking
technology. These have included:
In 1984 was formed the Committee on Mechanisation in the Banking Industry (1984) whose
chairman was Dr. C Rangarajan, Deputy Governor, Reserve Bank of India. The major
recommendations of this committee were introducing MICR technology in all the banks in
the metropolises in India. This provided for the use of standardized cheque forms and
encoders.
In 1988, the RBI set up the Committee on Computerisation in Banks (1988) headed by Dr. C
Rangarajan. It emphasized that settlement operation must be computerized in the clearing
houses of RBI in Bhubaneshwar, Guwahati, Jaipur, Patna and Thiruvananthapuram. It further
stated that there should be National Clearing of inter-city cheques at
Kolkata, Mumbai, Delhi, Chennai and MICR should be made operational. It also focused on
computerisation of branches and increasing connectivity among branches through computers.
It also suggested modalities for implementing on-line banking. The committee submitted its
reports in 1989 and computerisation began from 1993 with the settlement between IBA and
bank employees' associations.
In 1994, the Committee on Technology Issues relating to Payment systems, Cheque
Clearing and Securities Settlement in the Banking Industry (1994) was set up under
Chairman W S Saraf. It emphasized Electronic Funds Transfer (EFT) system, with the
BANKNET communications network as its carrier. It also said that MICR clearing should be
set up in all branches of all those banks with more than 100 branches.
In 1995, the Committee for proposing Legislation on Electronic Funds Transfer and
other Electronic Payments (1995) again emphasized EFT system.
Total numbers of ATMs installed in India by various banks as on end June 2012 is
99,218. The New Private Sector Banks in India are having the largest numbers of ATMs.

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1.5 EXPANSION OF BANKING INFRASTRUCTURE:-
As per Census 2011, 58.7% households are availing banking services in the country.
There are 102,343 branches of Scheduled Commercial Banks (SCBs) in the country, out of
which 37,953 (37%) bank branches are in the rural areas and 27,219 (26%) in semi-urban
areas, constituting 63% of the total numbers of branches in semi-urban and rural areas of the
country. However, a significant proportion of the households, especially in rural areas, are
still outside the formal fold of the banking system. To extend the reach of banking to those
outside the formal banking system, Government and Reserve Bank of India (RBI) are taking
various initiatives from time to time some of which are enumerated below:
Opening of Bank Branches: Government had issued detailed strategy and guidelines
on Financial Inclusion in October 2011, advising banks to open branches in all habitations of
5,000 or more population in under-banked districts and 10,000 or more population in other
districts. Out of 3,925 such identified villages/habitations, branches have been opened in
3,402 villages/habitations (including 2,121 Ultra Small Branches) by end of April, 2013.
Each household to have at least one bank account: Banks have been advised to ensure
service area bank in rural areas and banks assigned the responsibility in specific wards in
urban area to ensure that every household has at least one bank account.
Business Correspondent Model: With the objective of ensuring greater financial inclusion
and increasing the outreach of the banking sector, banks were permitted by RBI in 2006 to
use the services of intermediaries in providing financial and banking services through the use
of Business Facilitators (BFs) and Business Correspondents (BCs). Business correspondents
are retail agents engaged by banks for providing banking services at locations other than a
bank branch/ATM. BCs and the BC Agents (BCAs) represent the bank concerned and enable
a bank to expand its outreach and offer limited range of banking services at low cost,
particularly where setting up a brick and mortar branch is not viable. BCs as agents of the
banks, thus, are an integral part of the business strategy for achieving greater financial
inclusion. Banks had been permitted to engage individuals/entities as BC like retired bank
employees, retired teachers, retired government employees, ex-servicemen, individual owners
of kirana/medical/fair price shops, individual Public Call Office (PCO) operators, agents of
Small Savings Schemes of Government of India, insurance companies, etc. Further, since
September 2010, RBI had permitted banks to engage "for profit" companies registered under
the Indian Companies Act, 1956, excluding Non-Banking Financial Companies (NBFCs), as
BCs in addition to individuals/entities permitted earlier. According to the data maintained by

25
RBI, as in December, 2012, there were over 152,000 BCs deployed by Banks. During 2012-
13, over 183.8 million transactions valued at 165 billion (US$2.8 billion) had been
undertaken by BCs till December 2012.
Swabhimaan Campaign: Under "Swabhimaan" - the Financial Inclusion Campaign
launched in February 2011, banks had provided banking facilities by March, 2012 to over
74,000 habitations having population in excess of 2000 using various models and
technologies including branchless banking through Business Correspondents Agents (BCAs).
Further, in terms of Finance Minister's Budget Speech 2012-13, the "Swabhimaan" campaign
has been extended to habitations with population of more than 1,000 in North and to
habitations which have crossed population of 1,600 as per census 2001. About 40,000 such
habitations have been identified to be covered under the extended "Swabhimaan" campaign.
Setting up of Ultra Small Branches (USBs): Considering the need for close
supervision and mentoring of the Business Correspondent Agents (BCAs) by the respective
banks and to ensure that a range of banking services are available to the residents of such
villages, Ultra Small Branches (USBs) are being set up in all villages covered through BCAs
under Financial Inclusion. A USB would comprise of a small area of 100 sq ft (9.3 m2) -
200 sq ft (19 m2) where the officer designated by the bank would be available with a laptop
on pre-determined days. While the cash services would be offered by the BCAs, the bank
officer would offer other services, undertake field verification and follow up on the banking
transactions. The periodicity and duration of visits can be progressively enhanced depending
upon business potential in the area. A total of over 50,000 USBs have been set up in the
country by March, 2013.
Banking Facilities in Unbanked Blocks: All the 129 unbanked blocks (91 in North
East States and 38 in other States) identified in the country in July 2009, had been provided
with banking facilities by March 2012, either through Brick Mortar Branch or Business
Correspondents or Mobile van. As a next step it has been advised to cover all those blocks
with BCA and Ultra Small Branch which have so far been covered by mobile van only.
USSD Based Mobile Banking: National Payments Corporation of India (NPCI)
worked upon a "Common USSD Platform" for all banks and telcos who wish to offer the
facility of Mobile Banking using Unstructured Supplementary Service Data (USSD) based
Mobile Banking. The Department helped NPCI to get a common USSD Code *99# for all
telcos. More than 20 banks have joined the National Uniform USSD Platform (NUUP) of
NPCI and the product has been launched by NPCI with BSNL and MTNL. Other telcos are
likely to join in the near future. USSD based Mobile Banking offers basic Banking facilities

26
like Money Transfer, Bill Payments, Balance Enquiries, Merchant Payments etc. on a simple
GSM based Mobile phone, without the need to download application on a phone as required
at present in the IMPS based Mobile Banking.
STEPS TAKEN BY RESERVE BANK OF INDIA (RBI) TO STRENGTHEN THE
BANKING INFRASTRUCTURE:-
RBI has permitted domestic Scheduled Commercial Banks (excluding RRBs) to open
branches in tier 2 to tier 6 cities (with population up to 99,999 as per census 2001) without
the need to take permission from RBI in each case, subject to reporting.
RBI has also permitted SCBs (excluding RRBs) to open branches in rural, semi-urban
and urban centres in North Eastern States and Sikkim without having the need to take
permission from RBI in each case, subject to reporting.
Regional Rural Banks (RRBs) are also allowed to open branches in Tier 2 to Tier 6
centres (with population up to 99,999 as per Census 2001) without the need to take
permission from RBI in each case, subject to reporting, provided they fulfill the following
conditions, as per the latest inspection report:
 CRAR of at least 9%;
 Net NPA less than 5%;
 No default in CRR / SLR for the last year;
 Net profit in the last financial year;
 CBS compliant.
Domestic SCBs have been advised that while preparing their Annual Branch Expansion
Plan (ABEP), they should allocate at least 25% of the total number of branches proposed to
be opened during the year in unbanked Tier 5 and Tier 6 centres i.e. (population up to 9,999)
centres which do not have a brick and mortar structure of any SCB for customer based
banking transactions.
RRBs have also been advised to allocate at least 25% of the total number of branches
proposed to be opened during a year in unbanked rural (Tier 5 and Tier 6) Centres).
New private sector banks are required to ensure that at least 25% of their total branches are in
semi-urban and rural centres on an ongoing basis.

27
TYPES OF BANKS:-
 Central bank
 Development Bank
 Investment Bank
 Cooperative Credit Bank
 Regional Rural Bank
 Non Banking Financial Companies
CENTRAL BANK:-
The money market that acts as the central monetary authority of the country, serving as the
government bank as well as the bankers’ bank is known as a central bank of the country. The
main functions of central bank of a country are functions of note issue, bankers to
government, banker’s bank etc. The RBI as the central bank of the country is the centre of the
Indian financial and monetary system. It has been guiding, monitoring, and regulating,
controlling, and promoting destiny of the IFS. It is quite young compared with such central
banks as the Bank of England, Risks bank of Sweden, and the Federal Reserve Board of the
U.S.
MAIN FUNCTIONS OF THE RESERVE BANK OF INDIA :-
As the central banking authority of India, the reserve Bank of India performs the
following traditional functions of the central bank:
 It provides currency and operates the clearing system for the government and banks.
 It formulates and implements monetary and credit policies.
 It functions as the government’s and banker’s bank
 It supervises the operations of credit institutions.
 It regulates foreign exchange transactions.
 It moderates the fluctuations in the exchange value of the rupee.
In addition to the traditional functions of the central banking authority, the Reserve bank
of India performs several functions aimed at developing the Indian financial system:
 It seeks to integrate the unorganized financial sector with the organized financial
sector.
 It encourages the extension of the commercial banking system in the rural areas.
 It influences the allocation of credit.
 It promotes the development of new institutions.

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DEVELOPMENT BANKS:-
A development bank may be defined as a financial institution concerned with
providing all types of financial assistance to business units in the form of loans, underwriting,
investment and guarantee operations and promotional activities-economic development in
general and industrial development in particular.A development bank is basically a term
lending institution. It is a multipurpose financial institution with a broad development
outlook. The concept of development banks in a post independence phenomenon in India.
With the end of II World War there was an urgent need for speed industrial development in
India. The usual agencies that provided finance for large industries were inadequate. So the
govt. of India came forward to set-up a series of financial institution to provide funds to
industries. The industrial finance corporation of India, the first development bank was
established in 1948. Subsequently many other institutions were set-up. Ex. IDBI, IFCI,
SIDBI etc.
INVESTMENT BANKS:-
Financial intermediaries that acquire the savings of people and direct these funds into
the business enterprises seeking capital for the acquisition of plant and equipment and for
holding inventories are called ‘investment banks’.
Features:-Long term financing, Security, merchandiser, Security middlemen, Insurer,
Underwriter
Functions: - Capital formation, Underwriting, Purchase of securities, Selling of
securities, Advisory services, Acting as dealer.
COOPERATIVE BANKING SECTOR:-
These banks play a vital role in mobilizing savings and stimulating agricultural
investment. Co-operative credit institutions account for the second largest proportion of
44.6% of total institutional credit of Rs.3854000 corer to agricultural and allied activities in
the rural sector in 1998 to 99.

29
TYPES OF CO-OPERATIVE BANKING SECTOR:-
The co-operative sector is very much useful for rural people. The co-operative banking
sector is divided into the following categories.
 State co-operative Banks
 Central co-operative banks
 Primary Agriculture Credit Societies
NON BANKING FINANCE COMPANIES:-
According to RBI it means financial institutions which is a company and a non
banking institution and which has as its principal business the receiving of deposits under any
schemes or arrangement or in any other manner or lending in any manner.
MERCHANT BANKS:-
Institution that render wide range of services such as the management of customer’s
securities, portfolio management, counseling, insurance, etc are called ‘Merchant Banks’.
Functions: - Sponsoring issues, Loan syndication, Servicing of issues, Portfolio,
management, arranging fixed deposits, helps in merger& acquisition.
COMMERCIAL BANKS:-
Commercial banks comprising public sector banks, foreign banks, and private sector
banks represent the most important financial intermediary in the Indian financial system.
The changes in banking structure and control have resulted duet wider geographical
spread and deeper penetration of rural areas, higher mobilization of deposits, reallocation of
bank credit to priority activities, and lower operational autonomy for a bank management
The largest commercial Banks in India, (SBI), was set up in 1955 when the Imperial
Bank was nationalized and merged with some banks of the princely states. In 1969, in one
fell swoop, the fourteen largest privately – owned commercial banks were nationalized.
Subsequently, several other privately – owned commercial banks were nationalized. As a
result of these actions, public sector commercial banks, dominate the commercial banking
scene in the country.

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FUNCTIONS OF COMMERCIAL BANKS:-
 Saving mobilization
 Special loans
 Bills discount
 Credit creation
 Agencies function
 General utility function
COMPANY OVERVIEW
PUBLIC SECTOR BANKS:-
 State Bank of India.
 17 out of 20 nationalized banks except Andhra Bank, Bank of Maharashtra and
Bharatiya Mahila Bank.
 Regional rural banks, Assam Grameen Vikas Bank, sponsored by United Bank of
India
REGIONAL RURAL BANK:-
They are oriented towards meeting the needs of the weaker section of the rural
population consisting of small and marginal farmers, agricultural laborer and small
entrepreneurs. These banks were set up after the nationalization of banks in 1969.
REGIONAL RURAL BANKS ACT, 1976 ACT NO. 21 OF 1976 [9th February, 1976.]
An Act to provide for the incorporation, regulation and winding up of Regional Rural
Banks with a view to developing the rural economy by providing, for the purpose of
development of agriculture, trade, commerce, industry and other productive activities in the
rural areas, credit and other facilities, particularly to the small and marginal farmers,
agricultural laborers, artisans and small entrepreneurs, and for matters connected therewith
and incidental thereto.
DEFINITION OF PUBLIC SECTOR BANK:-
Public Sector Banks (PSBs) are banks where a majority stake (i.e. more than 50%) is
held by a government. The shares of these banks are listed on stock exchanges. There are a
total of 21 PSBs in India.

31
EMERGENCE OF PUBLIC SECTOR BANKS
The Central Government entered the banking business with the nationalization of the
Imperial Bank of India in 1955. A 60% stake was taken by the Reserve Bank of India and the
new bank was named as the State Bank of India. The seven other state banks became the
subsidiaries of the new bank when nationalised on 19 July 1960.[2] The next major
nationalisation of banks took place in 1969 when the government of India, under Prime
Minister Indira Gandhi, nationalised an additional 14 major banks. The total deposits in the
banks nationalised in 1969 amounted to 50 crores. This move increased the presence of
nationalised banks in India, with 84% of the total branches coming under government
control.
The next round of nationalisation took place in April 1980. The government
nationalised six banks. The total deposits of these banks amounted to around 200 crores. This
move led to a further increase in the number of branches in the market, increasing to 91% of
the total branch network of the country. The objectives behind nationalisation where:
 To break the ownership and control of banks by a few business families,
 To prevent the concentration of wealth and economic power,
 To mobilize savings from masses from all parts of the country,
 To cater to the needs of the priority sectors.
LIST OF PSU BANKS :-
 Allahabad Bank
 Bank of Baroda
 Bank of India
 Canara Bank
 Central Bank of India
 Corporation Bank
 Dena Bank
 IDBI Bank
 Indian Bank
 Indian Overseas Bank
 Oriental Bank of Commerce
 Punjab National Bank
 Punjab & Sind Bank
 Syndicate Bank
 UCO Bank
 Union Bank of India
 United Bank of India
 Vijaya Bank
 State Bank of India

32
STATE BANK OF INDIA (SBI)
State Bank of indies an Indian multinational, Public Sector banking and Services
Company. It is a government-owned corporation with its headquarters in Mumbai,
Maharashtra. As of December 2013, it had assets of US$388 billion and 17,000 branches,
including 190 foreign offices, making it the largest banking and financial services company
in India by assets. State Bank of India is one of the Big Four banks of India, along with Bank
of Baroda, Punjab National Bank and Bank of India].The bank traces its ancestry to British
India, through the Imperial Bank of India, to the founding, in 1806, of the Bank of Calcutta,
making it the oldest commercial bank in the Indian Subcontinent. Madras merged into the
other two "presidency banks" in British India, Bank of Calcutta and Bank of Bombay, to
form the Imperial Bank of India, which in turn became the State Bank of India.[8] India
owned the Imperial Bank of India in 1955, with Reserve Bank of India (India's Central Bank)
taking a 60% stake, and renamed it the State Bank of India. In 2008, the government took
over the stake held by the Reserve Bank of India. State Bank of India is a regional banking
behemoth and has 20% market share in deposits and loans among Indian commercial banks]
HISTORY
Seal of Imperial Bank of India. The roots of the State Bank of India lie in the first
decade of the 19th century, when the Bank of Calcutta, later renamed theBank of Bengal, was
established on 2 June 1806. The Bank of Bengal was one of three Presidency banks, the other
two being the Bank of Bombay (incorporated on 15 April 1840) and the Bank of
Madras (incorporated on 1 July 1843). All three Presidency banks were incorporated as joint
stock companies and were the result of royal charters. These three banks received the
exclusive right to issue paper currency till 1861 when, with the Paper Currency Act, the right
was taken over by the Government of India. The Presidency banks amalgamated on 27
January 1921, and the re-organised banking entity took as its name Imperial Bank of India.
The Imperial Bank of India remained a joint stock company but without Government
participation. Pursuant to the provisions of the State Bank of India Act of 1955, the Reserve
Bank of India, which is India's central bank, acquired a controlling interest in the Imperial
Bank of India. On 1 July 1955, the Imperial Bank of India became the State Bank of India. In
2008, the government of India acquired the Reserve Bank of India's stake in SBI so as to
remove any conflict of interest because the RBI is the country's banking regulatory authority.
In 1959, the government passed the State Bank of India (Subsidiary Banks) Act, which made
eight state banks associates of SBI. A process of consolidation began on 13 September 2008,
when the State Bank of Saurashtra merged with SBI.SBI has acquired local banks in rescues.

33
The first was the Bank of Bihar (est. 1911), which SBI acquired in 1969, together with its 28
branches. The next year SBI acquired National Bank of Lahore (est. 1942), which had 24
branches. Five years later, in 1975, SBI acquired Krishnaram Baldeo Bank, which had been
established in 1916 in Gwalior State, under the patronage of Maharaja Madho Rao Scindia.
The bank had been the Dukan Pichadi, a small moneylender, owned by the Maharaja. The
new bank's first manager was Jall N. Broacha, a Parsi. In 1985, SBI acquired the Bank of
Cochin in Kerala, which had 120 branches. SBI was the acquirer as its affiliate, the State
Bank of Travancore, already had an extensive network in Kerala. The State Bank of India and
all its associate banks are identified by the same blue keyhole logo. The State Bank of
India word mark usually has one standard typeface, but also utilises other typefaces. On
October 7, 2013, Arundhati Bhattacharya became the first woman to be appointed
Chairperson of the bank.
UNITED BANK OF INDIA (UBI)
United Bank of India is one of the 14 major banks which were nationalized on July
19, 1969. Its predecessor 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) (which
were established in the years indicated in brackets after the names). The origin of the Bank
thus goes as far back as to 1914. As against 174 branches, Rs. 147 crores of deposits and Rs.
112 crores of advances at the time of nationalization in July, 1969, today the Bank is 100%
CBS enabled with2000 branches and offices and is having a Total business of more than
Rs 2 lac crore. Presently the Bank is having a Three-tier organizational set-up consisting of
the Head Office, 35 Regional Offices and the Branches.
After nationalization, the Bank expanded its branch network in a big way and actively
participated in the developmental activities, particularly in the rural and semi-urban areas in
conformity with the objectives of nationalization. In recognition of the role played by the
Bank, it was designated as Lead Bank in several districts and at present it is the Lead Bank in
30 districts in the States of West Bengal, Assam, Manipur and Tripura. The Bank is also the
Convener of the State Level Bankers' Committees (SLBC) for the States of West Bengal and
Tripura.
UBI played a significant role in the spread of banking services in different parts of the
country, more particularly in Eastern and North-Eastern India. UBI has sponsored 4 Regional
Rural Banks (RRB) one each in West Bengal, Assam, Manipur and Tripura. These four

34
RRBs together have over 1000 branches. United Bank of India has contributed 35% of the
share capital/ additional capital to all the four RRBs in four different states. In its efforts to
provide banking services to the people living in the not easily accessible areas of the
Sunderbans in West Bengal, UBI had established two floating mobile branches on motor
launches which moved from island to island on different days of the week. The floating
mobile branches were discontinued with the opening of full- fledged branches at the centers
which were being served by the floating mobile branches. UBI is also known as the 'Tea
Bank' because of its age-old association with the financing of tea gardens. It has been the
largest lender to the tea industry.
The Bank has three full fledged Overseas Branches one each at Kolkata, New Delhi and
Mumbai with fully equipped dealing room and SWIFT terminal . Operations of all the
branches have since been computerized and Electronic Fund Transfer System came to be
implemented in the Bank's branches across the country. The Bank has ATMs all over the
country and customers can use United International Debit Card at all VISA ATMs across the
globe.

35
PRIVATE BANKS:-
The private-sector banks in India represent part of the Indian banking sector that is
made up of both private and public sector banks. The "private-sector banks" are banks where
greater parts of stake or equity are held by the private shareholders and not by government.
Banking in India has been dominated by public sector banks since the 1969 when all major
banks were nationalised by the Indian government. However since liberalisation in
government banking policy in the 1990s, old and new private sector banks have re-emerged.
They have grown faster & bigger over the two decades since liberalisation using the latest
technology, providing contemporary innovations and monetary tools and techniques. The
private sector banks are split into two groups by financial regulators in India, old and new.
The old private sector banks existed prior to the nationalisation in 1969 and kept their
independence because they were either too small or specialist to be included in
nationalisation. The new private sector banks are those that have gained their banking license
since the liberalisation in the 1990s.
OLD PRIVATE-SECTOR BANKS:-
The banks, which were not nationalized at the time of bank nationalization that took
place during 1969 and 1980, are known to be the old private-sector banks. These were not
nationalized; because of their small size and regional focus. Most of the old private-sector
banks are closely held by certain communities their operations are mostly restricted to the
areas in and around their place of origin. Their Board of directors mainly consist of locally
prominent personalities from trade and business circles. One of the positive points of
these banks is that, they lean heavily on service and technology and as such.
NEW PRIVATE-SECTOR BANKS:-
The banks, which came in operation after 1991, with the introduction of economic
reforms and financial sector reforms are called "new private-sector banks”. Banking act was
then amended in 1993, which permitted the entry of new private-sector banks in the Indian
banking s sector. The private sector bank some of those criteria being:#The bank should have
a minimum net worth of Rs. 200 crores.
 The promoters holding should be a minimum of 25% of the paid-up capital.
 Within 3 years of the starting of the operations, the bank should offer shares to public and
their net worth must increased to 300 crores.

36
LIST OF PRIVATE BANKS :-
 Axis Bank
 Federal Bank
 HDFC Bank
 ICICI Bank
 IndusInd Bank
 Yes Bank
AXIS BANK LIMITED
Axis bank limited (formerly UTI Bank) is the third largest private sector bank in
India. It offers financial services to customer segments covering Large and Mid-Corporate,
MSME, Agriculture and Retail Businesses. Axis Bank has its headquarters in Mumbai,
Maharashtra.
HISTORY
Axis Bank began its operations in 1994, after the Government of India allowed new
private banks to be established. The Bank was promoted in 1993 jointly by the Administrator
of the Unit Trust of India (UTI-I), Life Insurance Corporation of India (LIC), General
Insurance Corporation Ltd., National Insurance Company Ltd., The New India Assurance
Company, The Oriental Insurance Corporation and United India Insurance Company. The
Unit Trust of India holds a special position in the Indian capital markets and has promoted
many leading financial institutions in the country. Axis Bank (erstwhile UTI Bank) opened its
registered office in Ahmedabad and corporate office in Mumbai in December 1993. The first
branch was inaugurated on 2 April 1994 in Ahmedabad by Dr. Manmohan Singh, the then
Finance Minister of India. In 2001 UTI Bank agreed to merge with and amalgamate Global
Trust Bank, but the Reserve Bank of India (RBI) withheld approval and nothing came of this.
In 2004 the RBI put Global Trust into moratorium and supervised its merger into Oriental
Bank of Commerce.UTI Bank opened its first overseas branch in 2006 Singapore. That same
year it opened a representative office in Shanghai, China.UTI Bank opened a branch in
the Dubai International Financial Centre in 2007. That same year it began branch operations
in Hong Kong. The next year it opened a representative office in Dubai. Axis Bank opened a
branch in Colombo in October 2011, as a Licensed Commercial Bank supervised by the
Central Bank of Sri Lanka. Also in 2011, Axis Bank opened representative offices in Abu
Dhabi. In 2013, Axis Bank's subsidiary, Axis Bank UK commenced banking operations. Axis
Bank UK has a branch in London. In 2014, Axis Bank upgraded its representative office in
Shanghai to a branch.

37
ICICI BANK;-
ICICI bank is an Indian multinational banking and financial services company
headquartered in Mumbai, Maharashtra. As of 2014 it is the second largest bank in India in
terms of assets and market capitalization. It offers a wide range of banking products and
financial services for corporate and retail customers through a variety of delivery channels
and specialized subsidiaries in the areas of investment banking, life, non-life
insurance, venture capital and asset management. The Bank has a network of 3,820 branches
and 11,162 ATMs in India, and has a presence in 19 countries. ICICI Bank is one of the Big
Four banks of India, along with State Bank of India, Punjab National Bank and Bank of
Baroda. The bank has subsidiaries in the United Kingdom, Russia, and Canada; branches in
United States, Singapore, Bahrain, Hong Kong, Sri Lanka, Qatar and Dubai International
Finance Centre; and representative offices in United Arab Emirates, China, South Africa,
Bangladesh, Thailand, Malaysia and Indonesia. The company's UK subsidiary has also
established branches in Belgium and Germany. [6]In March 2013, Operation Red
Spider showed high-ranking officials and some employees of ICICI Bank involved in money.
After a government inquiry, ICICI Bank suspended 18 employees and faced penalties from
the Reserve in relation to the activity
HISTORY:-
ICICI's branch located in Knightsbridge, London.ICICI Bank was established by
the Industrial Credit and Investment Corporation of India (ICICI), an Indian financial
institution, as a wholly owned subsidiary in 1994. The parent company was formed in 1955
as a joint-venture of the World Bank, India's public-sector banks and public-sector insurance
companies to provide project financing to Indian industry. The bank was initially known as
the Industrial Credit and Investment Corporation of India Bank, before it changed its name to
the abbreviated ICICI Bank. The parent company was later merged with the bank.ICICI Bank
launched internet banking operations in 1998. ICICI's shareholding in ICICI Bank was
reduced to 46 percent, through a public offering of shares in India in 1998, followed by an
equity offering in the form of American Depositary Receipts on the NYSE in 2000. ICICI
Bank acquired the Bank of Madura Limited in an all-stock deal in 2001 and sold additional
stakes to institutional investors during 2001-02.In the 1990s, ICICI transformed its business
from a development financial institution offering only project finance to a diversified
financial services group, offering a wide variety of products and services, both directly and
through a number of subsidiaries and affiliates like ICICI Bank. In 1999, ICICI become the

38
first Indian company and the first bank or financial institution from non-Japan Asia to be
listed on the NYSE. In 2000, ICICI Bank became the first Indian bank to list on the New
York Stock Exchange with its five million American depository shares issue generating a
demand book 13 times the offer size. In October 2001, the Boards of Directors of ICICI and
ICICI Bank approved the merger of ICICI and two of its wholly owned retail finance
subsidiaries, ICICI Personal Financial Services Limited and ICICI Capital Services Limited,
with ICICI Bank. The merger was approved by shareholders of ICICI and ICICI Bank in
January 2002, by the High Court of Gujarat at Ahmedabad in March 2002 and by the High
Court of Judicature at Mumbai and the Reserve Bank of India in April 2002. In 2008,
following the 2008 financial crisis, customers rushed to ICICI ATMs and branches in some
locations due to rumours of adverse financial position of ICICI Bank. The Reserve Bank of
India issued a clarification on the financial strength of ICICI Bank to dispel the rumours.
BUSINESS OF BANKING:-
Figure no.1

40
Chapter | 4
LIMITATIONS OF THE STUDY:-
Due to constraints of time and resources the study is likely to suffer from certain
limitations. Some of them are mentioned below so that the findings of the study are
understood in proper perspective.
The limitations of the study are –
1) Some of the respondents of the survey were unwilling to share information.
2) The research was carried out in a short period of time so. Therefore the sample
size and other parameters were selected accordingly so as to finish the work in
given time frame.
3) The information given by the respondents might be biased because some of them
might not be interested in providing correct information.
4) The officials of the bank supported us a lot but did not have sufficient time to
clear all the points elaborately.
5) Since the sample unit is a semi urban place i.e. with less presence of private sector
banks, hence the result is likely to tilt a bit towards the public sector banks.

41
3. ANALYSIS
1) Do you have any bank A/C?
a) Yes b) No
TABLE NO :1
Statistics
Do you have any
bank a/c ?
N
Valid 100
Missi
ng
0
Mean 1.00
Median 1.00
Mode 1
Do you have any bank a/c ?
Frequenc
y
TABLE NO :2
Fig No:-4
ANALYSIS AND INTERPRETATION
Percent Valid
Percent
From the above results we come to know that out of 100 respondent only who have
bank account. This shows majority of our respondents are all have bank account.
Cumulative
Percent
Valid Yes 100 100.0 100.0 100.0

42
2) Are you aware of the difference between public and private sector banks?
a) Yes b) No c) Partially
TABLE NO:-3
Statistics
Are you aware of the
difference between public
and private sector banks ?
N
Valid 100
Missing 0
Mean 1.65
Median 1.00
Mode 1
Are you aware of the difference between public and
Yes 53 53.0 53.0 53.0
No 29 29.0 29.0 82.0
Partial
ly
T
T
private sector banks ?
Percent Valid
Percent
18 18.0 18.0 100.0
Total 100 100.0 100.0
ABLE NO:-4
Fig No:-5
Vali
d
ANALYSIS AND INTERPRETATION:-
Frequen
cy
Cumulativ
e Percent
From the above results it can be said that regarding the awareness between public
sector and private bank with respects to differarence,the response are mixed.18% are aware
of the differences which comprises 50% the tally while 29% don’t know the difference
between PSU banks and private banks.18% are not sure.

43
3) Which sector bank do you prefer?
a) Public b) Private
Table No:-5
Statistics
Which sector bank
do you prefer ?
N
Valid 100
Missi
ng
0
Mean 1.37
Median 1.00
Mode 1
Which sector bank do you prefer ?
Frequen
cy
Publi
c
63 63.0 63.0 63.0
Privat
e
37 37.0 37.0 100.0
Total 100 100.0 100.0
Table No:-6
Fig No:-6
Vali
d
Percent Valid
Percent
Cumulativ
e Percent
From the above pie – chart it can be inferred that majority of our respondents avail
public sector banks.63% respondents out of 100 avail public sector services, which in itself is
a very thumping number. The number of private sector respondents is 37%. Hence it can be
inferred that public sector banks outweigh the private sector banks with respect to customer
in this particular region of semi urban area.

44
Q4 Which type of account do you maintain in the bank ?
(You can tick more than one option, if other please specify )
Table No:-7
Salary
A/C
Savings
A/C
Home
Loan
Education
Loan
Fixed
Deposit
Other
83 70 12 25 42 13
This pie chart so that accounts are given by banks:-
25
42
13 Salary A/C
12 70
Fig No 7
83
Savings A/C
Home Loan
Education Loan
Fixed Deposite
Other
From the above result it can be inferred that the customers of public sector banks and
private sector banks are offering the facilities about the accounts and others.

45
6) How often do you perform transactions with bank?
a) Daily b) Weekly
c) Fortnight d) Monthly
Table No:-8
Statistics
how often do you
perform transaction with
bank ?
N
Valid 100
Missin
g
0
Mean 1.91
Median 2.00
Mode 1
how often do you perform transaction with bank ?
Frequenc
y
Percent Valid
Daily 47 47.0 47.0 47.0
Weekly 25 25.0 25.0 72.0
18 18.0 18.0 90.0
Monthly 10 10.0 10.0 100.0
Total 100 100.0 100.0
Table No :-9
Fortnigh
t
Fig No 8
Valid
Percent
Cumulative
Percent
Form the above bar –charts it can be inferred that majority of our respondents a
transactions in both bank.100 respondents in 47 % respondents daily transections,25%
respondents weekly transaction ,18% fortnight transections,10 % monthly transactions. This
shows that how many transaction used by in months..

46
7) Which facilities is/are best provided by your bank?
(You can tick more than one option, if other please specify)
Table No:-10
Loan
facilities
ATM Check
book
facilities
Credit
Card/Debit
Card
Online
Banking
Mobile
Banking
Other
51 73 57 43 35 13 5
35
13
80
70
60
50
40
30
20
10
0 5
FIG N:- 9
51
73
57
43
Series2
Series1
From the above analysis it can be inferred that majority of the respondents use
automated teller machine (ATM) services that is being provided by all the banks except the
RRBs. ATM users are 73 out of 100 respondents which is more than 80%. Mobile banking is
used by 13 respondents; check book are availed by 57 respondents while credit card services
are used by 43 respondents. This shows that in this part of country they are more concerned
with the conservative way of using the bank and not ready to explore yet to other services

47
8) Which type of services do you use?(Tick more than one option ,if other please
specify )
Table No:-11
ATM Fixed
Deposit
Internet
Bank
Loan Fund
transfer
Other
84 70 39 28 23 1
This table shows the service provide by the banks.
39
28
Internet
Bank
Loan Fund
Fig No 10
84
70
23
Series1
Series2
Series3
1
90
80
70
60
50
40
30
20
10
0
ATM Fixed
Deposit
transfer
Other
The above results show that service is provided by bank. just like fixed deposit, internet
banking, loan etc.

48
9) How does the bank levy the charges for different transactions?
(E.g. Issue of Demand Draft)
a) High b) Standard c) Low
Table No:-12
Statistics
How does the bank levy
the charge for different
transaction ?
N
Valid 100
Missin
g
0
Mean 1.77
Median 2.00
Mode 2
How does the bank levy the charge for different
transaction ?
Frequen
cy
Percent Valid
High 30 30.0 30.0 30.0
63 63.0 63.0 93.0
Low 7 7.0 7.0 100.0
Total 100 100.0 100.0
Table No:-13
Standar
d
FIG NO 11
Vali
d
Percent
Cumulative
Percent
From the above results it can be inferred that majority of our respondents are availing
frequency of the charges for different transactions.. Almost 36 % of our respondents are
standards charges.30 % are banks gives high charges about transactions and 7 % low charges
about the transactions’ just like demand drafts, and different bank transactions.

49
10) How would you rate the overall efficiency of your bank in the following ?
(tick in the applicable box)
Table No:-14
No. of facilities Handlings of induiries Behavior Ease good average bad good average bad good average bad good 84 9 7 51 43 6 53 41 6 This fig no:-11 shows overall efficiency in bank.
Fig No 12
84
9 7
51 43
6
53 41
6
30
64
6
40 44
16
47 44
9 25
66
9
100 2300 4500 6700 8900
good
average
bad
good
average
bad
good
average
bad
good
average
bad
good
average
bad
good
average
bad
good
average
Series1
bad
No. of
facilities
Handlings of
induiries
Behavior Ease of
language
Response
time
ATM coverage
by bank
System to
deal with
crisis
situation
Service/product Good Average Bad
No. of facilities
Handlings of
inquiries
Behavior
Ease of language
Response time
ATM coverage by
bank
System to deal with
crisis situation

50
11) Important in your decision about transacting with a bank ? (if other please specify)
a) Net banking b) Telephone banking
c) 24 hour customer service d) other
Table No:-15
Statistics
important in your
decision about
transacting with
bank?
N
Valid 100
Missi
ng
0
Mean 1.51
Median 1.00
Mode 1
TABLE NO :-16
To what extend are the following facilities important in your
decision about transacting with a bank ?
Net banking 70 70.0 70.0 70.0
Telephone
banking
24 hour customer
service
Other 1 1.0 1.0 100.0
Total 100 100.0 100.0
Fig No :-13
Freque
ncy
Percen
t
Valid
Percent
Cumulativ
e Percent
Vali
d
10 10.0 10.0 80.0
19 19.0 19.0 99.0
From the above analysis it can be inferred that majority of the respondents use (ATM)
services that is being provided by all the banks except the RRBs. ATM users are 70% out of
100 respondents, telephone banking is used by 10 respondents; 24 hour customers service are
availed by 19%respondents while other services are used by 1%respondents.

51
12) What is your satisfaction level with the service provided by your bank?
a) Excellent b) Good
c) Average d) Poor
Table No:-17
Statistics
What is your
satisfaction level
with the service
provided by your
bank ?
N
Valid 100
Missi
ng
0
Mean 1.69
Median 1.00
Mode 1
What is your satisfaction level with the service provided by
your bank ?
Frequenc
Percent Valid
53 53.0 53.0 53.0
Good 28 28.0 28.0 81.0
Average 16 16.0 16.0 97.0
Poor 3 3.0 3.0 100.0
Total 100 100.0 100.0
Table No:-18
y
Excellen
t
Fig No 14
Valid
Percent
Cumulative
Percent
From the above result it can be inferred that the customers of public sector banks are
satisfied toward their banks with number being 53 while 12 respondents are satisfied towards
their private sector bank. There are 15 respondents who like both.

52
13) Will you think of changing your bank if better service is provided?
a) Yes b) No c) Not sure
Table No:-19
Statistics
Will you think of changing
your bank if better service
is provided ?
N
Valid 100
Missing 0
Mean 1.71
Median 2.00
Mode 1a
a. Multiple modes exist.
The smallest value is
shown
Will you think of changing your bank if better service is
provided ?
Frequenc
y
Percent Valid
Yes 43 43.0 43.0 43.0
No 43 43.0 43.0 86.0
Not sure 14 14.0 14.0 100.0
Total 100 100.0 100.0
Table No:-20
Fig No:-15
Valid
Percent
From the above result it can be inferred that the customers of public and private
Cumulative
Percent
sector banks are satisfied toward or not so the satisfied their bank service 43% and not
satisfied are also 43% and others are not confidence 14%.The results shows 43 % service
providers satisfied with their banks 43% out of 100 and remaining 43% not satisfied with
their banks and 14 % are not sure about their bank services (private or public).

53
14) Any service you want your bank to improve ? (You can tick more than 1 option, if
other please specify)
a) Loan facilities b) ATM
c) Check book facilities d) Credit Card/ Debit Card
e) Online Banking f) Mobile Banking
g) Other ________________
Table No:-21
Loan
facilities
ATM Check
book
facilities
Credit
Card/Debit
Card
Online
Banking
Mobile
banking
Other
58 59 31 24 31 5 1
This charts shows any bank service improve by your bank:-
Fig No 16
58 59
31
24
31
5 1
70
60
50
40
30
20
10
0
Series2
Series3

54
15) Do you want to change your sector?
a) Yes b) No
Statistics
Do you want to
change your sector ?
N
Valid 100
Missi
ng
0
Mean 1.60
Median 2.00
Mode 1
Do you want to change your sector
Percent Valid
Yes 48 48.0 48.0 48.0
No 44 44.0 44.0 92.0
3 8 8.0 8.0 100.0
Total 100 100.0 100.0
Table No:-23
Fig No 17
Valid
Frequenc
y
Percent
Cumulative
Percent
From the above result it can be inferred that the customers of public and private
sector banks are satisfied toward or not so the satisfied their bank service to change their
sector if it is public or private its means that the 48 % change your sector,44% not change
your sector and 8 % not sure about it. At last the points the customers are not satisfied with
their banks its (public or private).

55
TWO VARIABLES
Q:-1 Do you have any bank account and which sector do you prefer ?
Statistics
Do you have any
bank a/c ?
Which secor bank
do you prefer ?
N
Valid 100 100
Missing 0 0
Mean 1.00 1.37
Median 1.00 1.00
Mode 1 1
Do you have any bank a/c ?
Frequenc
y
Percent Valid
Percent
Valid Yes 100 100.0 100.0 100.0
Which secor bank do you prefer ?
Frequenc
y
Percent Valid
Percent
Cumulative
Percent
Cumulative
Percent
Valid
Public 63 63.0 63.0 63.0
Private 37 37.0 37.0 100.0
Total 100 100.0 100.0
From the above tables shows that it can be inferred that majority of our respondents avail
public sector bank.63% respondents out of 100% avail public sector services, which in itself
is very thumping number. The number of private sector respondents is 37%.

56
Q :-2 Which sector bank do you prefer and Are you aware of the difference between public
and private sector banks?
Statistics
Which sector
bank do you
prefer?
Are you aware of the difference between public
and private sector banks?
N
Valid 100 100
Missing 0 0
Mean 1.37 1.65
Median 1.00 1.00
Mode 1 1
Which sector bank do you prefer?
Frequenc
y
Percent Valid
Percent
Cumulative
Percent
Valid
Public 63 63.0 63.0 63.0
Private 37 37.0 37.0 100.0
Total 100 100.0 100.0
Are you aware of the difference between public and private
sector banks?
Frequenc
y
Percent Valid
Percent
Cumulative
Percent
Valid
Yes 53 53.0 53.0 53.0
No 29 29.0 29.0 82.0
Partiall
y
18 18.0 18.0 100.0
Total 100 100.0 100.0
ANALYSIS AND INTERPRETATION:- the above table shows that which sector you
prefer and aware about the sector and who is the best public or private.

57
HYPOTHESIS
H0
aware about the difference between private and public sector bank
H1
not aware about the difference between private and public sector bank
HO
you will change bank if better service provider
H1
you will not change bank if better service provider
HO
you will change your sector
H1
you will not change your sector

58
Hypothesis and Chi-Square test
Q :-1 Gender ? * Are you aware of the difference between public and private sector banks?
Case Processing Summary
Cases
Valid Missing Total
N Percent N Percent N Percent
Gender ? * Are you
aware of the difference
between public and
private sector banks ?
100 100.0% 0 0.0% 100 100.0%
Gender ? * Are you aware of the difference between public and private sector banks ?
Cross tabulation
Are you aware of the difference between
public and private sector banks ?
Total
Yes No Partially
Gender ?
Male
Count 39 16 15 70
Expected
Count
37.1 20.3 12.6 70.0
Female
Count 14 13 3 30
Expected
Count
15.9 8.7 5.4 30.0
Total
Count 53 29 18 100
Expected
Count
53.0 29.0 18.0 100.0

59
Chi-Square Tests
Value df Asymp. Sig.
(2-sided)
Pearson Chi-Square 4.884a 2 .087
Likelihood Ratio 4.861 2 .088
Linear-by-Linear
.020 1 .887
Association
N of Valid Cases 100
a. 0 cells (0.0%) have expected count less than 5. The
minimum expected count is 5.40.
ANALYSIS AND INTERPRETATION:- above results shows that hypothesis and chi-square
test for the respondents are (gender and all are aware about the differences public or
private sector banks.)

60
Q:-2 Age Group ? * Will you think of changing bank if better service is provided?
Cases
Valid Missing Total
Age Group? * Will you
think of changing your
bank if better service is
provided?
100 100.0% 0 0.0% 100 100.0%
Age Group ? * Will you think of changing your bank if better service is provided ? Cross
tabulation
Will you think of changing your bank if
better service is provided ?
Total
Yes No Not sure
Age Group
?
18-35
Count 34 29 11 74
Expected
Count
31.8 31.8 10.4 74.0
35-50
Count 8 12 2 22
Expected
Count
9.5 9.5 3.1 22.0
50-65
Count 0 2 0 2
Expected
Count
.9 .9 .3 2.0
Above
65
Count 1 0 1 2
Expected
Count
.9 .9 .3 2.0
Total
Count 43 43 14 100
Expected
Count
43.0 43.0 14.0 100.0

61
Chi-Square Tests
(2-sided)
Linear-by-Linear
.581 1 .446
Association
minimum expected count is .28.
above results shows that hypothesis and chi-square test for the respondents are (age group
and better facilities provide by bank.)

62
Q:-3. Age group? * Do you want to change your sector?
Cases
Valid Missing Total
Age Group? * Do you
want to change your
sector?
100 100.0% 0 0.0% 100 100.0%
Age Group? * Do you want to change your sector? Cross tabulation
Do you want to change your
sector ?
Total
Yes No 3
Age Group
?
18-35
Count 37 33 4 74
Expected
Count
35.5 32.6 5.9 74.0
35-50
Count 10 9 3 22
Expected
Count
10.6 9.7 1.8 22.0
50-65
Count 1 0 1 2
Expected
Count
1.0 .9 .2 2.0
Above
65
Count 0 2 0 2
Expected
Count
1.0 .9 .2 2.0
Total
Count 48 44 8 100
Expected
Count
48.0 44.0 8.0 100.0

63
Chi-Square Tests
(2-sided)
Linear-by-Linear
2.205 1 .138
Association
minimum expected count is .16.
above results shows that hypothesis and chi-square test for the respondents are (age group
and they want change their sector..)

64
Chapter | 5
PROBLEMS FINDINGS OF THE STUDY:-
 More number of people have account in public sector banks.
 Majority of the respondents whether public sector or private sector banks have saving
banks account in their respective banks.
 People want a change in the behaviour of the staff towards customers in public sector
banks.
 There needs to be more awareness regarding the trust factor in private sector banks
and the amount deposited there in this part of country.
 People are more satisfied with the public sector banks in this part of country. The
main reason for their satisfaction is Trust factor and the Location of the branch.
 The private sector banks need to enhance the number of their branches and specially
cover the rural area so as to attract more customers. In addition they need to create
awareness among customers to enhance the trust factor in them.
 The facility that was availed most was the ATM/Debit card facility whether in private
sector bank or in public sector bank.
 Majority of the respondents do not want to shift from their current bank.
 The most favoured bank in this part of country is the SBI and UBI.
 From the above study it is clear that the respondents of public sector banks have
chosen the respective banks due to adequate branches i.e. location and due to the trust
factor.
 From the above study it is clear that the respondents of private sector banks like them
because of the friendly behaviour of the staff as well as the quick and fast services
that is being provided. As the public sector banks working under the financial
inclusion policy of RBI hence they have got more number of customers because they
have “ no frill account “ now a day’s called BSBDA (Basic saving bank deposit
account)
 From the above study it can be assured that BANCASSURANCE is still not a part in
this part of the country. Negligible amount of respondents have shown their interest in
this services along with mobile banking and credit card facility.

65
Chapter | 6
SUGGESTIONS:-
1. Based on the study conducted there are some of the suggestions given by the
customers. These are the comments given by them regarding the improvement of
banking services in India.
2. Banks should obey RBI norms and should provide facilities as per the norms. While
the customers should be given prompt services and the bank officials should be
willingly serving the customers.
3. Bank should increase rate of saving accounts
4. Bank should provide loans at a lower interest rate and education loan should be given
with ease without much documentation.
5. Fair dealings with the customers. More contribution from the employee to the bank.
The staff should be co-operative, friendly and must be capable of understanding the
problem of customers.
6. Prompt dealing with permanent customer and speedy transaction without harassing
the customers.
7. Each branch of each bank should be computerized even in rural areas for speedy
transaction.
8. RTGS and NEFT can play a very important role in speedy transaction.
9. More ATM coverage should be provided for the convenience of the customers
10. No limit of cash withdrawals should be there on customers
11. 24 hour banking should be induced so as to facilitate the customers who don’t have
time in the day time or in the week days. This will enhance the services
12. The charges for opening saving bank account in private bank are too high. This
should be taken care off.
13. Customers generally complain that full knowledge regarding products and services
are not given to them. Hence the bank should be fair enough in disclosing the proper
terms and conditions of the product and services.
14. The branch should promote cooperation and coordination among employees which
can enhance the rate of efficiency.
15. Knowledge of local language should be a must for employees of banks.
Chapter | 7

66
RECOMMENDATION:-
FOR PUBLIC SECTOR BANKS:-
 Bank staff should be customer friendly and highly motivated to serve the normal
customers.
 As far as possible the bank should reduce the documentation process while providing
loan.
 Computerization should be done in banks at all levels and the operators should be
properly trained.
 Token system should be introduced so as to reduce the waiting line in the bank.
 Proper ambience in the banks can develop a healthy work culture.
 Should be flexible in providing interest of the deposited money.
 Quick services should be provided.
FOR PRIVATE SECTOR BANKS:-
 24 hours banking should be introduced so as to facilitate the customers who don’t
have time in day time or week days.
 More ATM coverage should be provided for convenience of the customers.
 Should reduce the amount while opening a new saving bank account.
 Should maintain a proper recruitment policy like the PSU to attract genuine talent to
work for the customers. Rather than recruiting on internal recommendation they
should follow the IBPS for recruitment to get better talent and better services from
their employees.
 Should enhance the number of branches in rural areas to attract more customers.
 Should advertise extensively regarding their operations and services to garner faith in
them.

67
Chapter | 8
CONCLUSION:-
From the above study we can conclude that the people have more faith on PSU Bank
than Private sector Bank. The main reasons are as follows
Since there are less number of branches of private sector banks in this country and
also the trust factor is less in case of private sector banks. Whereas for PSU Banks they are
working under the financial inclusion policy of the RBI and thus have adequate number of
branches in this place which Private Sector Banks do not. Hence with respect to this place it
is the PSU Bank mainly SBI & UBI as revealed in our study which is far ahead of the Private
Sector Banks with respect to customer base.
Since, banking industry is bound to grow extensively in the next few years; it is up to
the private sector banks to enhance the number of branches in the country to attract customers
of the said place.
For the PSU Bank in order to sustain the large customer base, they to change their
view regarding the customer relationship management (CRM). Their employees need to
change their behaviour and attitude towards its customers in order to serve its customer whole
heartedly and willingly.

68
ANNAEXURE
QUESTIONNAIRE
Bank Account Details:
2) Do you have any bank A/C?
b) Yes b) No
2) Are you aware of the difference between public and private sector banks?
a) Yes b) No c) Partially
3) Which sector bank do you prefer?
a) Public b) Private
4) Which type of A/C do you maintain in the bank? (You can tick more than 1 option, if
other
please specify)
a) Salary A/C b) Savings A/C c) Home Loan
d) Education Loan e) Fixed Deposit f) Other
___________
5) Why did you choose that particular bank? (You can tick more than 1 option, if other
please specify)
a) Trust & Reliability b) Friendly behavior by staff
c) Quick & fast response d) Location
e) other ________________
6) How often do you perform transactions with bank?
a) Daily b) Weekly
c) Fortnight d) Monthly

69
7) Which of the facilities is/are best provided by your bank? (You can tick more than 1
option,
if other please specify)
g) Other __________________
8) Which type of services do you use? (You can tick more than 1 option, if other please
specify)
a) ATM b) Fixed Deposit
c) Internet Bank d) Loan
e) Fund transfer f) other
_________________
9) How does the bank levy the charges for different transactions? (E.g. Issue of Demand
Draft)
a) High b) Standard c) Low

70
10) How would you rate the overall efficiency of your bank in the following ?(tick in the
applicable box)
Service/product Good Average Bad
No. of facilities
Handlings of
inquiries
Behavior
Ease of language
Response time
ATM coverage by
bank
System to deal with
crisis situation
11) To what extent are the following facilities important in your decision about transacting
with
a bank ? (if other please specify)
a) Net banking b) Telephone banking
c) 24 hour customer service d) Other
__________
12) What is your satisfaction level with the service provided by your bank?
a) Excellent b) Good
c) Average d) Poor

71
13) Will you think of changing your bank if better service is provided?
a) Yes b) No c) Not sure
14) Any service you want your bank to improve ? (You can tick more than 1 option, if other
please specify)
g) Other ________________
15) Do you want to change your sector bank?
a) Yes b) No
PERSONAL INFORMATION:
1) Name:_______________________________________________________
2) Gender: Male Female
3) Age:
Age group
18-35
35-50
50-65
above 65
4) Marital status:________________________________

72
5) Education background :
Under- Graduate
Graduate
Post- Graduate
Professional

73
Chapter |
APPENDIX:-
SOURCE=
HTTP://SHODHGANGA.INFLIBNET.AC.IN/BITSTREAM/10603/3712/10/10_CHAPTER
%203.PDF
THIS LINK FOR LITERATURE REVIW

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