Download - Abhishek Tiwari Major Research Project Kotak Mahindra Bank

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INSTITUTE OF MANAGEMENT STUDIES

DAVV, INDORE(M.P)

Session (2010-12)

MAJOR RESEARCH PROJECT

ON

“Customer Retention Strategy of Kotak Mahindra Bank, Indore”

A Dissertation Submitted in Partial Fulfillment of the Requirement for the award of Degree of MBA

Guided by: Submitted by:Dr. P.N. Mishra Abhishek Tiwari

MBA FULL TIME

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http://www.kotak.com/Kotak_BankSite/index.htm

ACKNOWLEDGEMENT

I am thankful to Dr. Rajendra Singh, Director Institute Of Management Studies IMS (DAVV)

Indorefor providing me the opportunity to carry out the research on “Customer Retention

Strategy Of Kotak Mahindra Bank, Indore.”

I express my deepest and most sincere thanks to my mentor Dr. P.N. Mishra of Institute of

Management Studies IMS (DAVV), Indore for providing the guidance and helping me in

conducting the research.

The project would not have completed without the hearty support and guidance of Mr.

Shafeequddin Khan, Relationship Manager Kotak Mahindra Bank, Indore.

I also take this opportunity to thank all the employees and customers of Kotak Mahindra Bank,

Indore, without their Co-operation the project would have not been completed.

Abhishek Tiwari

Institute Of Management Studies, Indore

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DECLARATION

I hereby declare that the research entitled “Customer Retention Strategy Of Kotak Mahindra

Bank, Indore” is the result of my sincere effort. This major research project report is being

submitted by me alone, at Institute of Management Studies, Indore, for the partial fulfillment of

the course MBA (FULL TIME) and the report has not been submitted to any other educational

institution for any other purpose.

Date:

Signature:

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CERTIFICATE

This is to certify that Mr. Abhishek Tiwari, student of MBA (Full Time) program of Institute Of

Management, Indore has completed his major research project on “Customer Retention

Strategy Of Kotak Mahindra Bank, Indore.” and prepared this report under my guidance.

Dr. P.N. Mishra

(Faculty Guide)

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INDEX

S.NO CONTENTS PAGE NUMBER

EXECUTIVE SUMMARY

6-7

1. INTRODUCTION 8-13

2. LITERATURE REVIEW 14-16

3. RESEARCH METHODOLOGY 17-18

4. COMPANY PROFILE 19-52

5. DATA ANALYSIS, RESULTS AND

FINDINGS

53-81

6. CONCLUSION AND

RECOMMENDATIONS

82-84

7. LIMITATIONS AND SAMPLE

QUESTIONNAIRE

85-90

8. REFERENCES AND BIBLIOGRAPHY 91-93

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EXECUTIVE SUMMARY

The p ro j ec t i s ba sed on t he Cus tomer Re t en t i on S t r a t egy o f Bank ing

Organ i za t i ons w i th spec i a l r e f e r ence t o KOTAK MAHINDRA BANK

and t he cus tomer s ’ a s we l l a s emp loyees ’ pe r cep t i on abou t t he s ame .

Fi r s t and Fo remos t , t he pu rpose o f KOTAK MAHINDRA BANK i s

t o fu l f i l l t he needs fo r i nves tmen t unde r one roo f w i th an equa l

b l end o f S t anda rd i za t i on a long w i th Cus tomiza t i on .

Thi s p ro j ec t shows t he impor t ance o f cus tomer r e t en t i on a s a

s t r a t egy fo r t he succe s s o f a bank ing o rgan i za t i on .

I t g i ve s t he de t a i l v i ew o f t he va r i ous pa r ame te r s t ha t a bank

shou ld keep unde r cons ide ra t i on i n o rde r t o ensu re cus tomer

r e t en t i on .

The focus i s on t he f a c t t ha t en su r ing max imum cus tomer

s a t i s f ac t i on and ea rn ing t he i r l oya l t y i s t he key t o succe s s i n t he

h igh ly compe t i t i ve bank ing i ndus t ry .

The p ro j ec t dep i c t ed t he impor t ance o f va r i ous pa r ame te r s and

a l so t r i ed t o f i l l t he knowledge gap r ega rd ing t he f a c to r s t ha t

en su re be t t e r s e rv i ce qua l i t y and cus tomer l oya l t y .

The p ro j ec t a l so emphas i zed t he impor t ance o f an emp loyee -

cus tomer pa r t i c i pa to ry p roce s s w i th cus tomer s a t i s f ac t i on a s a

pe r fo rmance eva lua t i on c r i t e r i on fo r an emp loyee o f t he

o rgan i za t i on .

The p ro j ec t c l e a r l y dep i c t s t ha t t he cus tomer s a t i s f ac t i on l eve l o f

Ko tak Mah ind ra Bank i s qu i t e impre s s ive and hence i t ha s been

ab l e t o en joy l i f e t ime member sh ip o f i t s ex i s t i ng member s and

hence i s hav ing a c l e a r cu t compe t i t i ve advan t age o f cus tomer

l oya l t y ove r i t s compe t i t o r s wh ich i s t he ma in d r i ve r f o r i t s huge

succe s s s t o ry on ly i n a pe r i od o f 8 yea r s o f i t s i ncep t i on .

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Fur the r t o t h i s , p ro j ec t p roceeds w i th t he r e sea r ch de s igned i n t he l i gh t

o f t he co re ob j ec t i ve s o f t he s t udy a long w i th t he sub ob j ec t i ve s t ha t

a r e g iven due cons ide ra t i on t h roughou t t he r e sea r ch . I t a l so en l i s t s a l l

t he da t a sou rce s a s t o by wh ich means t he s t udy ha s ga ined momen tum.

The da t a ha s been co l l e c t ed by v i r t ue o f ques t i onna i r e s and webs i t e s ,

r e spec t i ve ly . The s cope o f t he s t udy i s sugges t ed i n f avo r o f t he

compan i e s s t r i v ing t o emerge a s supe r power d r awn ou t by t he su rvey .

Hence , t he company can f i ne t une i t s p ro spec t i ve s t r a t egy o f cus tomer

r e t en t i on and can g r ab t he oppo r tun i t i e s o f t r ans fo rming t he weaknes s

o f o the r i n to i t s own s t r eng th .

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CHAPTER 1

INTRODUCTION

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INTRODUCTION

“CUSTOMER RETENTION STRATEGY OF KOTAK MAHINDRA BANK,

INDORE”

In this study, I have conducted a research on the customer satisfaction level of Kotak Mahindra

Bank through a descriptive study conducted in the Indore branch of Kotak Mahindra Bank. A

structured questionnaire is used to generate the feedback from the customers, employees and

other marketing intermediaries. On the analysis of this structured questionnaire, i am able to

draw a conclusion regarding the customer retention strategy and its effectiveness in creating and

sustaining customer satisfaction by Kotak Mahindra Bank.

MOTIVATION FOR THE TOPIC:In the present scenario, banking sector in India is

emerging as the most developing sector of the economy with all the Multinational banks entering

the country. Hence, being a prospective manager with my field of interest in the banking industry

and the tremendous growth potential in the banking industry of our country, I got motivated to

work on a topic that can result into an effective learning of this country. The main motivation for

the topic lies in the fact that:-

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The banking industry is highly competitive, with banks not only competing among each other

but also with non-banking and other financial institutions. Most bank product developments are

easy to duplicate and when banks provide nearly identical services, they can only distinguish

themselves on the basis of price and quality. Therefore, customer retention is potentially an

effective tool that banks can use to gain a strategic advantage and survive in today’s ever-

increasing banking competitive environment.

EXPLAINATION OF CONCEPTS ENTAILED: -The main concept entailed in our

study is that customer retention is more profitable strategy rather than new customer acquisition.

It is more economical to keep existing customers than to acquire new ones. The cost of acquiring

customers to “replace” those who have been lost are high. This is because the expense of

acquiring customers is incurred only in the beginning stages of the customer relationship.

In addition, longer term customers buy more and, if satisfied, may generate positive word of

mouth promotion for the company. Additionally, long term customers also take less of the

company time and are less sensitive to price changes.

Customer retention refers to keeping a client’s business rather than have the client use

competitor’s services or products. Business want to reduce customer defections to their

competitors because a reduction in their market share and profits could result. Customer service

retention is a popular marketing strategy as it involves focusing on meeting or exceeding client’s

expectations in order to maintain their loyalty.

When people feel loyal to a certain brand or business, they are less likely to be persuaded by a

competitor’s ads and offers. Maintaining customer retention through loyalty programs is a

method commonly used by many businesses today.

The structured questionnaire is prepared on the basis of the concept given by Parasuraman.

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BRIEF HISTORY REGARDING THE TOPIC: - Previous studies have identified

the benefits that customer retention delivers to an organization (Colgate et.al, 1996; Reicheld and

Sasser, 1990; Storbacka et.al; 1994)

For Example: - The longer a customer stays with an organization, the more utility the customer

generates (Reichheld and Sasser, 1990). This is an outcome of a number of factors relating to the

time the customer spends with the organization. These include the higher initial costs of

introducing and attracting a new customer, increases in both the value and number of purchases,

the customer’s better understanding of the organization, and positive word of mouth promotion.

Apart from the benefits that the longevity of customers bring, research findings also suggest that

the costs of customer retention activities are less than acquiring new customers. For Example,

Rust and Zahorik (1993) argue the financial implications of attracting new customers may be

five times as costly as keeping existing customers. Customer satisfaction leads to customer

retention. As a consequence, retaining customer becomes a priority.

In the banking industry, many banks are providing more or less the identical products for nearly

the same price. Unless a bank can extend its product quality beyond the core service with a

additional and potential service features and value, it is unlikely to gain a sustainable competitive

advantage (Chang, Chan, and Leck, 1997)

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MY MOTIVATION FOR THE TOPIC: -I have chosen this topic as a dissertation for

Major Research Project because of my interest in the banking industry and the realization of the

importance of customer retention as a strategy in a banking industry. I got motivated to choose

Kotak Mahindra Bank for the study because of the tremendous and substantial growth of Kotak

Mahindra Bank since its inception in 2003. Kotak Mahindra Bank has emerged as one of the

fastest growing bank and among the most admired financial institutions in India. The major

strategy implemented by Kotak Mahindra Bank down the years have been customer retention

and hence the customers appreciate the services and products offered by the bank and are willing

to recommend the bank to their acquaintances. Hence, through this study, with the help of the

success story of Kotak Mahindra Bank, I would like to signify the importance of customer

retention as a strategy in case of banking institutions.

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OBJECTIVES OF THE STUDY:-

PRIMARY OBJECTIVE: To analyze the Customer Retention Strategy of Kotak Mahindra

Bank.

SECONDARY OBJECTIVES:

1. To analyze the customer’s attitude and satisfaction level towards Kotak Mahindra Bank.

2. To identify the needs of customers for customer- bank relationship improvement.

3. To know the preferences and problems of customers of the bank.

4. To ensure the satisfaction level of services provided by the bank.

5. To get the views about the changing customer needs.

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CHAPTER 2

LITERATURE SURVEY

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LITERATURE SURVEY:Previous studies have identified the benefits that customer

retention delivers to an organization (Colgate et. al, 1996; Reichheld and Sasser, 1990;Storbacka

et. al, 1994)

The longer a customer stays with an organization, the more utility the customer generates

(Reichheld and Sasser, 1990). This is an outcome of a number of factors relating to the time the

customer spends with the organization. These include the higher initial costs of introducing and

attracting a new customer, increases in both the value and number of purchases, the customer’s

better understanding of the organization, and positive word of mouth promotion.

Apart from the benefits that the longevity of customers brings, research findings also suggest that

the costs of customer retention activities are less than acquiring new customers.

For Example, Rust and Zahorik (1993) argue the financial implications of attracting new

customers may be five times as costly as keeping the existing customers. Customer satisfaction

leads to customer retention. As a consequence, retaining customers becomes a priority. Previous

research shows, however, that longevity does not automatically leads to profitability (Colgate,

Stewart, and Kinsella, 1996).

In a highly competitive market, the shortest route to differentiation is through the development of

brands and active promotion to both intermediaries and final consumers (Parasuraman, 1997). In

the long run, however, branding, targeting, and positioning would all be much more effective if

the supplier had some tangible advantage to offer to consumers (Baker, 1993). This is evident in

the banking industry, where many banks are providing more or less the identical products for the

same price.

Unless a bank can extend its product quality beyond the core service with additional and

potential service features and value, it is unlikely to gain a sustainable competitive advantage

(Chang, Chan and Leck, 1997). Thus, the most likely way to both retain customers and improve

profitability is by adding value via a strategy of differentiation (Baker, 1993) while increasing

margins through higher prices. In businesses, where the underlying products have become

commodity-like, quality of service depends heavily on the quality of its personnel. This is well

documented in a study by Leeds (1992), who documented that approximately 40 percent of

customers switched banks because of what they considered to be poor service. Leeds further

argued that nearly three- fourth of the banking customers mentioned tellers’ courtesy as a prime

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consideration in choosing a bank. The study also showed that increased use of service quality

and professional behaviors (such as formal greetings) improved customer satisfaction and

reduced customer attrition.

Although a huge amount of work has been done in the field of depicting the importance

of customer retention as one of the most important strategy in case of organizations especially

service institutions like banks, and a lot of research has been conducted to find out that service

quality and professional behavior at the work place are the two most critical elements in ensuring

customer satisfaction and as a result customer retention, but still there is a knowledge gap about

the important parameters that can result into enhancing both the service quality as well as

professional behavior at work place in order to ensure customer retention for a banking

organization.

Hence, I have carried out this research with a motive of filling this knowledge gap by identifying

the key parameters that influences the service quality and professional behavior of the employees

by conducting a study on such 19 possible parameters and then analyzing the impact and its

extent of these parameters in enhancing the customer retention of Kotak Mahindra Bank.

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CHAPTER – 3

RESEARCH METHODOLOGY

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RESEARCH METHODOLOGY

A. Research type

Descriptive - Descriptive research, also known as statistical research, describes data and

characteristics about the population or phenomenon being studied. Descriptive research answers

the questions who, what, where, when andhow?

Collection of data – Primary data.

Data Collection Tool – I have used a Non Disguised structured questionnaire based on

the concept of Parasuraman in order to collect the data from the respondents.

Sample size - I have calculated the sample size using the formula of:

Sample Size = (k2C2)/r2, where k = 19/20 i.e., 1 approximately, c = coefficient of variation

and r = percentage of variation which we allow to be permitted. I have taken r = 5%.

Hence, our Sample size on calculation comes out to be 70.

B. Population : As I am conducting the survey on the customers, employees, marketing

intermediaries of Kotak Mahindra Bank, Indore, hence, all these together constitutes the

population for my research.

Sources of secondary data .Internet.

C. Tools for data analysis : I have used SPSS 16 Software as a tool for data analysis under

which I have analyzed the data using:

Pie chart: For the analysis of demographic variables especially.

Chi- square test: For the analysis of other non- parametric variables

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CHAPTER 4

COMPANY PROFILE

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INTRODUCTIO N

“Think Investment Think Kotak”

Banks like Kotak Mahindra, standard chartered, ICICI, HDFC, and Citibank now bring your

Bank Account and Debit card to your fingertips. With Mobile commerce, you can perform a

wide range of query-based transactions from your Mobile Phone, without even making a call.

Kotak Mahindra is one of India's leading financial institutions, offering complete financial

solutions that encompass every sphere of life. From commercial banking, to stock broking, to

mutual funds, to life insurance, to investment banking, the group caters to the financial needs of

individuals and corporate.

The group has a net worth of over Rs.1, 800 crore and employs over 4,400 employees in its

various businesses. With a presence in 82 cities in India and offices in New York, London,

Dubai and Mauritius, it services a customer base of over 5, 00,000.

Kotak Mahindra has international partnerships with Goldman Sachs (one of the world's largest

investment banks and brokerage firms) and Old Mutual (a large insurance, banking and asset

management conglomerate).

The Kotak Mahindra Group was born in 1985 as Kotak Capital Management Finance Limited.

This company was promoted by Uday Kotak, Sidney A. Pinto and Kotak & Company.

Industrialists Harish Mahindra and Anand Mahindra took a stake in 1986, and that's when the

company changed its name to Kotak Mahindra

Finance Limited. Since then it's been a steady and confident journey to growth and success.

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1986 : Kotak Mahindra Finance Limited starts the activity of Bill Discounting

1987 : Kotak Mahindra Finance Limited enters the Lease and Hire Purchase market

1990 : The Auto Finance division is started

1991 : The Investment Banking Division is started. Takes over FICOM, one of India’s

largest financial retail marketing networks

1992 : Enters the Funds Syndication sector

1995 : Brokerage and Distribution businesses incorporated into a separate company -

Kotak Securities. Investment Banking division incorporated into a separate company -

Kotak Mahindra Capital Company

1996 : The Auto Finance Business is hived off into a separate company - Kotak

Mahindra Primus Limited. Kotak Mahindra takes a significant stake in Ford Credit Kotak

Mahindra Limited, forfinancing Ford vehicles. The launch of Matrix Information

Services Limited marks the Group’s entry into information distribution.

1998 : Enters the mutual fund market with the launch of Kotak Mahindra Asset

Management Company.

2000 : Kotak Mahindra ties up with Old Mutual plc. for the Life Insurance business.

Kotak Securities launches kotakstreet.com - its on-line broking site. Formal

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commencement of private equity activity through setting up of Kotak Mahindra Venture

Capital Fund.

2003 : Kotak Mahindra Finance Ltd. Converts to bank

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COMPANY’S PROFILE

Established in 1984, The Kotak Mahindra Group has long been one of India’s most reputed

financial organizations. In Feb 2003, Kotak Mahindra Finance Ltd., the group’s flagship

company was given the license to carry on banking business by the Reserve Bank of India

(RBI).This approval creates banking history since Kotak Mahindra Finance Ltd is the first

company in India to convert to a bank. The license authorizing the bank to carry on banking

business has been obtained from the RBI in tune with Section 22 of the Banking Regulation Act

1949.

KMBL was promoted by Mr. Uday.S.Kotak, Kotak and Company Ltd and Mr. Sidney

&A.A.Pinto under the name of Kotak Capital Management Finance Ltd on 21st Nov 1985 and

obtained a Certificate of Commencement of Business on 11th Feb 1986.

The bank customers have access to entire VISA network of 4500 ATM’S in India and

800000ATM’S worldwide accepted in more than 56000 establishments across India and 10

million worldwide. The customer also has access to over 800 ATM’s with sharing arrangements

with UTI BANK, of these 125 are in the NCR.

Key group companies and their businesses

Kotak Mahindra Bank

The Kotak Mahindra Group's flagship company, Kotak Mahindra Finance Ltd which was established in 1985, was converted into a bank- Kotak Mahindra Bank Ltd in March 2003 becoming the first Indian company to convert into a Bank. Its banking operations offer a central platform for customer relationships across the group's various businesses. The bank has presence in Commercial Vehicles, Retail Finance, Corporate Banking, Treasury and Housing Finance.

Kotak Mahindra Capital Company

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Kotak Mahindra Capital Company Limited (KMCC) is India's premier Investment Bank. KMCC's core business areas include Equity Issuances, Mergers & Acquisitions, Structured Finance and Advisory Services.

Kotak Securities

Kotak Securities Ltd. is one of India's largest brokerage and securities distribution houses. Over the years, Kotak Securities has been one of the leading investment broking houses catering to the needs of both institutional and non-institutional investor categories with presence all over the country through franchisees and coordinators. Kotak Securities Ltd. offers online and offline services based on well-researched expertise and financial products to non-institutional investors.

Kotak Mahindra Prime

Kotak Mahindra Prime Limited (KMP) (formerly known as Kotak Mahindra Primus Limited) has been formed with the objective of financing the retail and wholesale trade of passenger and multi utility vehicles in India. KMP offers customers retail finance for both new as well as used cars and wholesale finance to dealers in the automobile trade. KMP continues to be among the leading car finance companies in India.

Kotak Mahindra Asset Management Company

Kotak Mahindra Asset Management Company Kotak Mahindra Asset Management Company (KMAMC), a subsidiary of Kotak Mahindra Bank, is the asset manager for Kotak Mahindra Mutual Fund (KMMF). KMMF manages funds in excess of Rs 20,800 crore and offers schemes catering to investors with varying risk-return profiles. It was the first fund house in the country to launch a dedicated gilt scheme investing only in government securities.

Kotak Mahindra Old Mutual Life Insurance Limited

Kotak Mahindra Old Mutual Life Insurance Limited is a joint venture between Kotak Mahindra Bank Ltd. and Old Mutual plc. Kotak Life Insurance helps customers to take important financial decisions at every stage in life by offering them a wide range of innovative life insurance products, to make them financially independent.

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BOARD OF DIRECTORS

Mr. K.M.Gherda – Executive Chairman

Mr. Uday Kotak –Executive Vice Chairman and Managing Director

Mr. Anand Mahindra –Co Promoter of Kotak Mahindra Bank andVice Chairman and Managing Director of Mahindra and Mahindra

Mr. Cyril Shroff –Co Promoter

Mr. Pradeep N Kotak –Agri Division of Kotak and Company Limited

Dr. ShankerAcharya

Mr. Shivaji Dam –Managing Director Kotak Mahindra Old Mutual Life Insurance Limited

Mr. C.Jayaram –Executive Director

Mr. Dipak Gupta –Executive Director

Product Detail

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Kotak Mah ind ra Bank i s one o f t he p rominen t subs id i a r i e s o f Ko tak

Mah ind ra g roup . The ac t i v i t i e s o f t he company be ing pa ra l l e l t o i t s

ob j ec t i ve a r e ve ry w ide and cove r a l l t he componen t s o f a Bank . The

Bas i c a r ea o f Ope ra t i ons i s t he Bank ing bus ine s s , o the r p roduc t s a r e

mean t f o r t he r egu l a r r evenue gene ra t i on . Be ing a Bank ing house , t he

company i s i n r egu l a r t ouch w i th Banking Account s , Inves tment

Serv i ce s , Conven ience Bank ing and Other Serv i ce s .

They offer complete solutions that address all your financial requirements, whether you're an

individual or a firm. From everyday banking to long term investments — their offering covers it

all. This wide range of products is delivered to you with a genuine understanding of your specific

need and warm, personalised service.

Kotak Mahindra Bank, it's not about selling you many different products — it's about working

out a holistic, pragmatic solution that addresses your financial needs. Through their varied

products,they commit themselves to becoming “banker” to the customer rather than being “asset

financier” to our customers.

Banking Account s

There are three types of banking account:

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Savings Account

Current Account

Term Deposit

SAVINGS ACCOUNT

“Choose from our range of Savings Accounts”

KOTAK MAHINDRA has got a variety of options of savings accounts to choose from for its

customers according to their convenience and requirements .These savings accounts offer

attractive returns along with personalized banking services at three convenient average quarterly

balances(AQB)levels of Rs. 10000 (KOTAK EDGE SAVINGS ACCOUNT),Rs. 20000

(KOTAK PRO SAVINGS ACCOUNT) and at Rs75000(KOTAK ACE SAVINGS

ACCOUNT).The average quarterly balance levels as well the corresponding services and

benefits try to ensure the various customer needs and requirements.

Thus the three account opening options in savings account are as mentioned above:

EDGE SAVINGS ACCOUNT: Kotak Mahindra Bank´s Edge Savings Account is a

complete financial package customized to suit individual banking needs. Its constant

endeavour is to enable regular financial transactions through online platform so that most

of payments can be made directly through your account or card.

Features & Benefits

Wide ATM access through the Kotak Mahindra Bank Debit Card

One can walk into any KOTAK or HDFC Bank ATMs to withdraw cash or enquire balance at no

extra charge!

Multiple Access Channels Access

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An account through phone, mobile phone or internet to get information about account balance or

track transactions. One can even transfer funds through Phone Banking or Net Banking.

Financial payments facilitated through the savings account

Use the free Payment Gateway to make online payments for utility bills, credit cards, online

trading of shares or even online shopping.

Quick and easy funds transfer

Quick funds transfer to a third party account with another Bank is available across 15 locations

through Net Banking. Also get a multi-city cheque book so that money from account is received

by the beneficiary in the fastest possible time.

Free investment account

One can open an investment account, and use the Net Banking facility to purchase/redeem

mutual funds online while directly debiting / crediting your Bank Account. Besides this you get a

consolidated view of all your mutual fund investments across schemes with updated returns

status, latest NAV information and research reports.

Attractive returns

Earn better returns in your savings account, with our 2-Way Sweep facility that automatically

sweeps out idle funds, above a threshold, from your account into Term Deposits. These Term

Deposits sweep back into your account to meet fund requirements when your withdrawals

exceed the balance available in your account, thereby providing you maximum liquidity.

PRO SAVINGS ACCOUNT:

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Kotak Mahindra Bank´s Pro Savings Account is an account packed with powerful features to

provide a superior banking experience at a very comfortable balance requirement. They provide

a relationship manager who will specifically take care of banking and investment needs.

Features & Benefits

Free ATM access all domestic VISA ATM network

Walk into any VISA ATM in India to check balance or withdraw cash absolutely free. no longer

have to worry about locating your Bank or Partner Bank ATM – Use the first VISA ATM that

you spot, for cash withdrawal or balance enquiry transactions.

Multiple access channels

Access your account through phone, mobile phone or internet to get information on your account

balance or track your transactions. You can even transfer funds through Phone Banking or Net

Banking.

Free investment account

One can open an investment account, and use the Net Banking facility to purchase/redeem

mutual funds online while directly debiting / crediting bank account. Besides this get a

consolidated view of all the mutual fund investments across schemes with updated returns status,

latest NAV information and research reports.


Use our free Payment Gateway to make online payments for utility bills, credit cards, online

trading of shares or even online shopping.

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Quick funds transfer to a third party account with another Bank is available across 15 locations

through Net Banking. Also get a multi-city cheque book so that money from account is received

by the beneficiary in the fastest possible time

Attractive returns



Deposits sweep back into your account to meet fund requirements when your withdrawals

exceed the balance available in your account, thereby providing you maximum liquidity.

Dedicated relationship manager

You get a one point contact for all your banking related queries and transactions. Your

relationship manager will also help you with financial planning and sound investment decisions.

Free banking transactions

You can issue demand drafts or send cheques for collection on branch locations without any

charge to your account.

ACE SAVINGS ACOUNT:

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Kotak Mahindra Bank's Ace Savings Account has been designed as a gateway to a world of

financial benefits and privileged banking transactions. The account carries benefits ranging from

personal investment advisory services to concierge services to free banking transactions. Onewill

find that this package of services and privileges is unmatched by any other savings account in the

market.

Features & Benefits

Free access at all domestic and international VISA ATMs

No longer have to worry about locating your Bank or Partner Bank ATM - Use the first VISA

ATM that you spot, for free cash withdrawal or balance enquiry transactions. So walk into any

VISA ATM in India or abroad to withdraw cash or for balance enquiry.

Multiple access channels

Access the account anytime through land line, mobile phone or internet to get information on

account balance or track transactions. One can even transfer funds through Phone Banking or

Net Banking.


Use the free Kotak Payment Gateway to make online payments for utility bills, credit cards,

online trading of shares or even online shopping. All this at the click of a mouse!


Transfer funds easily and with speed, to a beneficiary account at another bank. One can avail of

this facility by walking into any of branches or by simple logging on to Net Banking. Also get a

free multi-city cheque book so that money from your account is transferred to the beneficiary's

account at any of branch locations, in the fastest possible time.

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Free banking transactions

One can issue demand drafts or send cheques for collection at all branches for no extra charge.

Attractive returns



Deposits sweep back into account to meet fund requirements when withdrawals exceed the

balance available in the account, thereby providing maximum liquidity.

CURRENT ACCOUNT

Kotak Mahindra Bank offers unparalleled advantages with its three Current Account offerings.

Whether small/ mid size business or an enterprise spread across multiple locations in the country,

would find a Current Account that's just designed for you. These Current accounts offer

attractive returns along with personalized banking services at three convenient average quarterly

balances(AQB)levels of Rs. 25000 (KOTAK EDGE SAVINGS ACCOUNT),Rs. 50000

(KOTAK PRO SAVINGS ACCOUNT) and at Rs250000(KOTAK ACE SAVINGS

ACCOUNT).The average quarterly balance levels as well the corresponding services and

benefits try to ensure the various customer needs and requirements. With features ranging from

Free DDs, Free Cheque Collection, Free At -Par Cheque facility to Free Trading Account & free

Demat Account, and more!

Thus the three account opening options in savings account are as mentioned above:

32

Edge Current Account

In need of a well equipped bank account to keep pace in all the business endeavors. They offer

the Kotak Edge Current Account, armed with Kotak 2-Way Sweep and the entire gamut of

Banking Privileges, providing that extra edge to get ahead. The feature rich Kotak Edge Current

Account is the ideal way to make money work harder.

Features & Benefits

Multi City Banking

Current account/s with Kotak Mahindra Bank will be recognized in every other branch. One can

just walk into a Kotak Mahindra Bank branch in any of our branches across country to satisfy all

the banking needs.

2 - Way Sweep* : Term Deposit linked Current Account

Kotak 2-Way Sweep ensures that money never stops working for you. Daily balances, above a

threshold level, in Current Account are automatically swept out into Term Deposits (TD). This

'swept out amount' is brought back into account to meet fund requirements when withdrawals

exceed the balance available in the account (or when the account balance goes below the

specified threshold level.) With Kotak 2-Way Sweep you enjoy the twin advantages of attractive

returns & maximum liquidity.

Free Demand Drafts and Pay Orders

Enjoy the benefit of our free Demand Drafts, payable at Kotak Mahindra Bank Branch location

in India.

At-par Cheques

33

Get free At-par Cheques that are treated as 'local clearing' cheques across all branch locations.

All these at nominal costs.

Cheque Collection

All Outstation cheques, drawn on any of branch locations, are collected 'at nominal charge' for

you. The strong network of correspondent banks enables us to collect cheques from 1600

locations across India at faster speed and minimal cost

Mobile Banking and Alerts

Our Mobile Banking & Alerts service enables to access bank account on Mobile Phone. One can

access all your standing instructions (SI), any large credits or debits, available balance, balance

below AQB, any SI failure and SIs successfully executed will be intimated to you via SMS

PRO Current Account

You need a well equipped bank account to keep pace with you in the ever changing business

scenario. We offer you the Kotak Pro Current Account, armed with Kotak 2-Way Sweep, as well

as an entire gamut of Banking Privileges and 'user-friendly' Convenience Banking facilities. The

feature rich Kotak Pro Current Account is the ideal way to make your money work harder.

34

Key Features

Dedicated Relationship Manager

Free Demand Drafts & Pay Orders>

Free At Home Services

Better Forex rates and Efficient Trade Services

ACE Current Account

In the need of a well equipped bank account to keep pace with you in the ever changing business

scenario. They offer you the Kotak Ace Current Account, armed with Business benefits and

exclusive Ace Privileges and an entire gamut of banking conveniences especially designed for

you. The feature rich Kotak Ace Account is the ideal way to make money work harder

Term Deposits

Key Features

Ease and convenience of operation

Liquidity through overdraft or sweep-in facility

No penalty on pre-mature encashment

Nomination facility available

35

Give your portfolio stability of returns and safety and liquidity. Invest in Kotak Bank Term

Deposit. It offer attractive returns on term deposits and investing in them is really simple and

convenient.

Features & Benefits

Ease and convenience of operation

For the first time in India, New to Bank customer can also apply onlinefor term deposit.

An existing customer,can place a term deposit through Phone Banking or Net Banking. What's

more, one can even renew this deposit by placing an instruction over phone. Needless to

mention, he can do all this and more by walking across into any of branches.

Liquidity through overdraft or sweep-in facility

Deposit will be available to you should you need them in case of an emergency. One can avail

upto 85% overdraft against term by paying 2% above deposit rate. This facility is available for

deposits above Rs.50,000 for a tenure of 181 days or more. One can also choose to link term

deposit to savings / current account, whereby if need be, term deposit will automatically be

encashed to meet withdrawal requirement.

No penalty on pre-mature encashment

In case term deposit is pre-maturely encashed,one will earn interest at the rate prevailing on the

date of deposit for the withdrawn amount.

Nomination facility available

36

One can avail this facility for each & every account that open with us i.e. nominate different

persons for different term deposit accounts can choose to change the nominee through a

declaration in the appropriate form to revise the nomination during the term of the deposit.

INVETSMENT SERVICES

“Making your money grow”

At Kotak Mahindra Bank,canrecognise that financial needs vary, not just amongst individuals,

but across the different stages of your life. They have years of experience in helping people put

together an investment portfolio that works best for them.

DEMAT

37

Key Features

Efficient depository services that allow you to hold your shares in convenient, "demat"

formats

Leverage opportunities in the stock-market when you spot them

It offers streamlined, efficient depository services that allow to hold shares in the convenient

"demat" formats and leverage opportunities in the stock-market when you spot them Being a

brokerage house, the company is in regular touch with the share market and its relative indexes

like NSE &BSE, NCDEX. NSDL, CSDL. Le t ’ s unde r s t and t he r e l a t i ve t e rms :

SEBI (S tock Exchange boa rd o f I nd i a )

I t check ou t on NSE and BSE and a l l t ype o f sha re t r ad ing (Bo th p r ima ry

and s econda ry marke t )

NSE &BSE : - Kotak Mahindra Bank a l l ows t o cos tumer t o t r ade i n sha re w i th

NSE and BSE bo th ( i n p r ima ry and s econda ry marke t bo th ) . I n BSE

cos tumer can t r ade i n 2452 s t ocks and i n NSE cos tumer can t r ade i n 933

compan i e s . The i ndex o f NSE i s N i f t y and fo r BSE Sensex

NSDL AND CSDL

Kotak Mahindra Bank a l l ow to cos tumer t o i nves t i n mu tua l f und and bonds .

NSDL (Na t i ona l s ecu r i t y depos i t o ry l im i t ed ) and CSDL (Cen t r a l s ecu r i t y

depos i t o ry l im i t ed check ou t on t h i s t ype o f i nves tmen t

38

MCX AND NCDEX

Kotak Mahindra Bank a l so a l l ow to cos tumer t o t r ade i n commod i ty by MCX

(Mul t i Commodi ty exchange ) and NCDEX (Na t i ona l Commodi ty da i l y

exchange . I n NCDEX 55 commod i ty a r e t o t r ade

PRODUCTS OFFERED BY KOTAK MAHINRA BANK

The following are the various products of Kotak Mahindra Bank:

DEMAT & ON LINE TRADING ACCOUNT :

The 3-in-1 account integrates your banking, broking and demat accounts. This enables you to

trade in shares without going through the hassles of tracking settlement cycles, writing cheques

and Transfer Instructions, chasing your broker for cheques or Transfer Instructions etc.

INITIAL PUBLIC OFFERS(IPO’S)

In t he above p roduc t s we have d i s cus sed i nves tmen t i n equ i t y t h rough

s econda ry marke t s . ano the r way o f i nves t i ng i n equ i t y ma rke t s i s t h rough

t he p r ima ry marke t r ou t e .wheneve r a company comes ou t w i th an i n i t i a l

pub l i c o f f e r i ng you may choose t o app ly fo r t he sha re . Based on number

o f va l i d app l i c a t i on r ece ived , t he company wou ld t hen a l l o t t he sha re t o

app l i c an t s .

39

The o f f l i ne way o f i nves t i ng i n an IPO i s by f i l l i ng phys i ca l app l i c a t i on

fo rms , cheques . And submi t t i ng t he fo rms t h rough you r b roke r . Wi th

KOTAK MAHINDRA BANK a l l you have t o do i s f i l l i ng number o f sha r e

on t he s i t e and submi t .

DERIVATIVES

Cus tomer s w i th d i f f e r en t t ypes o f r i sk p ro f i l e c an u se de r i va t i ve s .

Hedg ing t he ca sh marke t pos i t i on – i dea l f o r l ow r i sk p ro f i l e .

Tak ing advan t age o f a rb i t r age oppo r tun i t y i n equ i t y and de r i va t i ve s

ma rke t s – idea l f o r l ow r i sk p ro f i l e

Tak ing a v i ew on s t ock / i ndex fo r a s l ong a s 3 mon th pe r i od –

med ium r i sk p ro f i l e

Specu l a t i ve t r ad ing -h igh r i sk p ro f i l e

KOTAK MAHINDRA BANK o f f e r s on l i ne i nves tmen t i n fu tu r e and op t i on ,

w i th bene f i t o f au toma ted s e t t l emen t s and on l i ne r i sk mon i to r i ng sy s t em

Mutual Funds

Key Features

Assitance at every step of the investment process

An experienced research team to analyse and research the Mutual Funds available in the

market

Portfolio assistance

Team analyses and researches the Mutual Funds available in the market, helping you make more

informed decisions. The recommendations take into account all relevant factors including the

40

investment philosophy of the Asset Management Company, portfolio quality, risk-adjusted

returns and market trends.

The Mutual funds on advisory list range form Debt to Equity funds and are drawn from top

performing schemes of renowned Mutual Fund houses like Franklin Templeton, Kotak, Reliance,

Prudential ICICI etc.Relationship Manager will recommend the funds that suit the investment

objectives.

In s t ead o f buy ing sha re s o f d i f f e r en t compan i e s t r a ck ing t he p r i c e

movemen t ’ s pe r fo rmance o f t he company , g rowth p rospec t s o f t he

i ndus t r i e s e t c . and t hen t ak ing you r own buy / se l l dec i s i on , you may

cons ide r mak ing i nves tmen t i n equ i t y /deb t ma rke t t h rough t he mu tua l f und

rou t e . Mu tua l f und i s a SEBI r eg i s t e r ed en t i t y t ha t poo l s t he money o f

many i nd iv idua l s ’ i nves to r s t o pu rchase t he s t ocks , bond o r o the r

f i nanc i a l i n s t rumen t s . p ro f e s s iona l

Managemen t and d ive r s i f i c a t i on a r e t he two p r ima ry bene f i t s o f mu tua l

f und i nves t i ng . Fo r beg inne r s , o r f o r cus tomer who a r e unab l e t o spend

t ime on r e sea r ch ing s t ocks t hemse lve s , mu tua l f und i s an i dea l r ou t e fo r a

i nves tmen t i n equ i t y . I nves t i ng i n mu tua l f unds o f f l i ne i nvo lve s , t r a ck ing

down the agen t s appo in t ed by t he mu tua l f unds AMCs , f i l l i ng l eng thy

fo rms , wr i t i ng cheque , r u sh ing t o t he o f f i c e o f t he agen t s be fo re t he cu t

o f f t im ing t o ensu re t ha t t he de s i r ed NAV i s a l l o t t ed

Bancassurance

41

They offer a range of carefully selected insurance policies across the entire spectrum of life

insurance products Relationship managers will analyze your insurance needs and develop the

solution that works best for you.

KOTAK INSURANCE has a wide array of insurance plans that have been designed with the

philosophy that different individuals are bound to have differing insurance needs.

The ideal insurance plan is one that addresses the exact insurance needs of the individual that

will depend on the age and life stage of the individual apart from a host of other factors.

The various plans offered by KOTAK INSURANCE are as follows:

Kotak Smart Advantage Plan

Kotak Eternal Life Plans

Kotak Headstart Child Plans

Kotak Safe Investment Plan II

Kotak Flexi Plan

Kotak Easy Growth Plan

Kotak Capital Multiplier Plan

Kotak Term Plan

Kotak Preferred Term Plan

CONVENIENCE BANKING

“Anywhere, Anytime Banking”

42

In today's day and age time is money. You work hard and have a busy schedule. Doing banking

should be easy and convenient and not add to worries.

Kotak Mahindra Bank realize this and have specially tailored a wide range of value added

products and services to make money work for you. These, coupled with the highest standard of

customer care will make life simpler and easier.

Multiple Banking Channels

Today the technology driven banks are finding various means to reduce costs and reach out to as

many customers as possible spread over a diverse area. This has led to using multiple channels of

delivery of their products.

ATM (Automatic Teller Machine) :

An ATM is basically a machine that can deliver cash to the customers on demand after

authentication. However, nowadays we have ATMs that are used to vend different FMCG

products also. An ATM does the basic function of a bank’s branch, i.e., delivering money on

demand. Hence setting of newer branches is not required thereby significantly lowering

infrastructure costs.

Cost reduction is however possible only when these machines are used. In India, the average

cash withdrawal per ATM per day has fallen from 100 last years to 70 this year. Though the

number of ATMs has increased since last year, it is not in sync with the number of cards issued.

Also, there are many dormant cardholders who do not use the ATMs and prefer the teller

counters. In spite of these odds, Indian banks are increasing the number of ATMs at a feverish

pace. These machines also hold the keys to future operational efficiency

43

Account holders of Kotak Mahindra Bank Saving Account having Visa Electron Debit Card can

access other Banks ATM machines unlimited times per month for free, after that the Account

holder has to pay nothing for the transaction. But also holders of ATM cards cannot access

machines belonging to other Banks.

The number of ATM machines installed by Kotak Mahindra Bank is 20 in Delhi and the All

India tally is 156 machines. When this figure is compared to ICICI Bank which has thrice the

number of machines in Delhi or HDFC Bank which has nearly twice the number of machines in

Delhi, this is worrying for Kotak Mahindra Bank.

“Growth In ATM Machine With Increased Use”

44

NAME OF BANK NUMBER OF ATM

MACHINES (ALL

INDIA BASIS)

NUMBER OF ATM

MACHINES (INDORE)

KOTAK MAHINDRA

Bank

122 26

ICICI Bank 560 112

HDFC Bank 625 66

IDBI 350 43

CITIBANK 160 22

HSBC 103 21

AMN Amro 40 13

UTI 507 -

GTB 250 20

The Table below shows the number of ATM machines belonging to various banks in India:-

From the above table we can clearly see that HDFC Bank is the Bank which has highest number

of ATM machines on All India basis, this is followed by ICICI Bank, then UTI.

When we look at the concentration of machines in the Delhi Region we see that out of ICICI

Bank’s 560 Machines 112 are located in Delhi representing 20%.

The corresponding figure for Kotak Mahindra Bank is 14.2%. HDFC Bank is 11.8%, IDBI Bank

is 12.3%, and CITIBANK is 13.75%.

45

Net Banking:

Net banking means carrying out banking transactions via the Internet. Thus the need for a branch

is completely eliminated by technology. Also this helps in serving the customer better and

tailoring products better suited for the customer.

A customer can view his account details, transaction history, order drafts, electronically make

payments, transfer funds, check his account position and electronically communicate with the

bank through the Internet for which he may have wanted to visit the bank branch.

Net banking helps a bank spread its reach to the entire world at a fraction of the cost

Phone Banking:

This means carrying out of banking transaction through the telephone. A customer can call up

the banks help line or phone banking number to conduct transactions like transfer of funds,

making payments, checking

of account balance, ordering cheques, etc. This also eliminates the customer of the need to visit

the bank’s branch.

Mobile Banking:

Banks can now help a customer conduct certain transactions through the Mobile Phone with the

help of technologies like WAP, SMS, etc. This helps a bank to combine the Internet and

telephone and leverage it to cut costs and at the same time provide its customer the convenience.

Thus it can be seen that tech savvy banks are tapping the entire above alternative channels to cut

costs improve customer satisfaction

SMS Banking

46

Kotak Mahindra Bank's SMS Banking service enables you to access your bank account,

investment account and demat account on your Mobile Phone. Now get latest update on your

account balance, salary credits, large debits, large credits, holding value and much more, on your

mobile anytime.

INTERNET BANKING

INTRODUCTION

The Internet banking is changing the banking industry and is having the major effects on banking

relationships. Internet banking involves use of Internet for delivery of banking products &

services. It falls into four main categories, from Level 1 - minimum functionality sites that offer

only access to deposit account data - to Level 4 sites - highly sophisticated offerings enabling

integrated sales of additional products and access to other financial services- such as investment

and insurance.

DRIVERS OF CHANGE

Advantages previously held by large financial institutions have shrunk considerably. The Internet

has leveled the playing field and afforded open access to customers in the global marketplace.

Internet banking is a cost-effective delivery channel for financial institutions. Consumers are

embracing the many benefits of Internet banking. Access to one's accounts at anytime and from

any location via the World Wide Web is a convenience unknown a short time ago.

The primary drivers of Internet banking are:

· Improve customer access

· Facilitate the offering of more services

· Increase customer loyalty

· Attract new customers

47

Internet Banking is the most technological advanced means to do Banking. Through this medium

the Account holder can do various types of transactions without having to leave his

Office/Residence.

The Account holder has the convenience to do transaction no matter where he is in the world at

any time of the day. Internet is the most cost effective medium of Banking from the point of

view of the Banks; it costs a fraction to the Bank as compared to other mediums like Branch

Banking or ATM.

But this medium is not as favored a medium as it in the west , the reasons for this is that firstly ,

this is a relatively new concept in India , secondly , general perception that this is not safe ,

thirdly , computers and internet are not widely spread all over the country.

MAIN CONCERNS IN INTERNET BANKING

48

Very Satisfied Somewhat Sat-isfied

Neither Satis-fied nor Dissat-

isfied

Somewhat Dissatisfied

Very Dissatis-fied

0

2

4

6

8

10

12

14

0

7

0

13

0

SATISFACTION LEVEL WITH INTERNET BANKING

In a survey conducted by the Online Banking Association, member institutions rated security as

the most important issue of online banking. There is a dual requirement to protect customers'

privacy and protect against fraud.

1. A multi-layered security architecture comprising firewalls, filtering routers, encryption and

digital certification ensures that account information is protected from unauthorized access:

Firewalls and filtering routers ensure that only the legitimate Internet users are allowed to access

the system.

2· Encryption techniques used by the bank (including the sophisticated public key encryption)

would ensure that privacy of data flowing between the browser and the Infinity system is

protected.

3· Digital certification procedures provide the assurance that the data you receive is from the

Infinity system.

STRATEGIC ALLIANCES ENTERED BY KOTAK MAHINDRA BANK

NATIONAL ATM ALLIANCES

49

The Institute for Development and Research in Banking Technology (IDRBT), a group

established by the Reserve Bank of India (RBI) in 1996, has planned to set up a national switch

to hook up all of the country's 10,000-odd ATMs.

The idea of establishing ATM interconnectivity through a national switch has been approved by

the information chiefs of various Banks.

The expected cost of transactions routed through the switch is to be under 10 rupees (21 cents

U.S.) each, due to the high volumes of transactions -- almost 100,000 per day.

CASH NET

It is an Alliance between Citibank, Industrial Development Bank of India, Kotak Mahindra Bank

and UTI Bank. This is the country's first independent shared ATM network.

IDBI Bank received permission from the Reserve Bank (RBI) to serve as the network's

settlement bank.

Cash net will give access to more than 1,300 ATMs for more than 6 million debit cardholders of

the member banks. The Alliance would constitute about a third of the total card base and 15

percent of the ATM base in the country.

Kotak Mahindra Bank and REDIFF.com

REDIFF.com India and Kotak Mahindra Bank have entered into an alliance to provide online

and offline banking and related services to the Indian consumer.

The alliance will enable information on the entire range of the banks consumer banking products

to be made available to the 6.4 million online customers of Rediff.com.

The services offered include detailed information on various deposits, loans and mortgages,

credit cards, mutual funds and insurance products of the bank. Users will be able to directly

interact with the bank and request for products online

50

OTHER SERVICES

BANKING HOURS

Kotak Mahindra Bank Account holders have been able to infer that Branch Banking is the

second most Frequent Point of Interaction with the Bank. The Average Banking Hours is a very

important aspect associated with any Bank. In today’s fast paced life where people who hold

Accounts with the Bank are busy working it is important that they can find a way to visit the

Bank without having to miss out on work.

The Average Banking Hours of Kotak Mahindra Bank is from 9am to 7pm, the Bank is open to

the public for ten hours. These timings are convenient for especially those Account holders who

are working, these people can visit the Bank after their Office finishes.

Apart from the Average Banking Hours Kotak Mahindra Bank offers to it’s Account holders 24

Hour Branch, 365 Days Branch and the facility of Sunday Banking.

Kotak Mahindra Bank is the only Bank which offers a 24 Hour Branch in India, this is a big

boon for people who cannot take the time out to visit the Bank during the normal working hours

and is also very handy during emergencies.

The 365 Day Branch of Kotak Mahindra Bank is also unique and the only other Bank offering

this service is ABN Amro , this Branch is open regardless of the fact that it is a Sunday or a

public holiday.

Sunday Banking is very useful for people who are busy throughout the week and the only day

when they find the time is Sunday. Other Banks offering this service apart from Kotak Mahindra

Bank are ABN Amro and CITIBANK.

Best Compliments Card – the perfect gift

51

Introducing Best Compliments Card - the prepaid card from Kotak Mahindra Bank. It lets

your loved ones choose their own gift or shop or enjoy at any place that accepts Visa cards,

be it a shopping mall, a restaurant or a multiplex. So go ahead and give someone the perfect

gift!

No Kotak Mahindra Bank account required

Not restricted to a single brand or outlet - accepted at over 3 lakhs merchant

establishments in India that accept Visa cards

Can be used at your convenience - no need to spend the entire value in a single purchase

Attractively packaged and ready-to-gift

Available at all Kotak Mahindra Bank branches

Valid for two years from date of issue of card

52

CHAPTER 5

DATA ANALYSIS, RESULTS AND FINDINGS

53

Statistics

GENDER AGE OCCUPATION INCOME

N Valid 70 70 70 70

Missing 0 0 0 0

Frequency Table

GENDER

Frequency Percent Valid Percent Cumulative Percent

Valid MALE 42 60.0 60.0 60.0

FEMALE 28 40.0 40.0 100.0

Total 70 100.0 100.0

AGE


Valid 15-25 YEARS 34 48.6 48.6 48.6

26-35 YEARS 16 22.9 22.9 71.4

36-45 YEARS 16 22.9 22.9 94.3

46 YEARS AND ABOVE 4 5.7 5.7 100.0

Total 70 100.0 100.0

54

OCCUPATION


Valid BUSINESS 9 12.9 12.9 12.9

GOVERNMENT JOB 14 20.0 20.0 32.9

PRIVATE SECTOR 28 40.0 40.0 72.9

OTHERS 19 27.1 27.1 100.0

Total 70 100.0 100.0

INCOME


Valid 1 LAC- 1.5 LACS 4 5.7 5.7 5.7

1.5 LACS- 2.5 LACS 8 11.4 11.4 17.1

2.5 LACS- 5 LACS 39 55.7 55.7 72.9

5 LACS AND ABOVE 19 27.1 27.1 100.0

Total 70 100.0 100.0

55

Pie Chart

56

Descriptive Statistics

N Mean Std. Deviation Minimum Maximum

RESPONSIVENESS 70 3.7571 .57573 3.00 5.00

QUALITY 70 3.6429 .66016 2.00 5.00

COMPETITIVENESS 70 3.4571 .65244 2.00 5.00

BANKINGSTAFF 70 3.8143 .90558 2.00 5.00

SERVICESPEED 70 3.7000 .95326 2.00 5.00

STAFFAVAILABILITY 70 3.9000 .78297 2.00 5.00

DISTINCTIVENESS 70 3.6286 .74545 2.00 5.00

CONVENIENCE 70 3.6000 .76896 2.00 5.00

ACCESSIBILITY 70 3.6429 .90146 1.00 5.00

SERVICABILITY 70 3.5857 .75167 2.00 5.00

PRICING 70 3.6571 .69960 2.00 5.00

BANKINGHOURS 70 3.7857 .79660 2.00 5.00

SECURITY 70 3.8714 .84992 2.00 5.00

SECURITYARCHITECTURE 70 3.8571 .87287 2.00 5.00

CUSTOMERLOYALTYPROGRA

MME70 3.6714 .73665 1.00 5.00

PERSONALIZATION 70 3.6714 .86345 1.00 5.00

CREDITWORTHINESS 70 3.8143 .76694 2.00 5.00

GRIEVANCEHANDLING 70 3.6000 .90730 1.00 5.00

OVERALLEXPERIENCE 70 3.8143 .68721 2.00 5.00

60

Chi-Square Test

Frequencies

RESPONSIVENESS

Observed N Expected N Residual

SATISFACTORY 22 23.3 -1.3

GOOD 43 23.3 19.7

EXCELLENT 5 23.3 -18.3

Total 70

Chi-square: 31.057

Degrees of Freedom: 2

Asymp. Significance: 0.000

61

QUALITY


POOR 1 17.5 -16.5

SATISFACTORY 29 17.5 11.5

GOOD 34 17.5 16.5


Total 70

Chi-square: 46.229



62

COMPETITIVENESS


POOR 3 17.5 -14.5


GOOD 29 17.5 11.5


Total 70

Chi-square: 49.086



63

BANKINGSTAFF


POOR 6 17.5 -11.5

SATISFACTORY 18 17.5 .5

GOOD 29 17.5 11.5

EXCELLENT 17 17.5 -.5

Total 70

Chi-square: 15.143



64

SERVICESPEED


POOR 7 17.5 -10.5


GOOD 22 17.5 4.5


Total 70

Chi-square: 9.886



65

STAFFAVAILABILITY


POOR 3 17.5 -14.5


GOOD 36 17.5 18.5


Total 70

Chi-square: 32.057



66

DISTINCTIVENESS


POOR 4 17.5 -13.5


GOOD 34 17.5 16.5


Total 70

Chi-square: 35.486



67

CONVENIENCE


POOR 4 17.5 -13.5


GOOD 30 17.5 12.5


Total 70

Chi-square: 30.800



68

ACCESSIBILITY


VERY POOR 2 14.0 -12.0

POOR 2 14.0 -12.0


GOOD 27 14.0 13.0


Total 70

Chi-square: 45.000



69

SERVICABILITY


POOR 4 17.5 -13.5


GOOD 31 17.5 13.5


Total 70

Chi-square: 33.429



70

PRICING


POOR 3 17.5 -14.5


GOOD 37 17.5 19.5


Total 70

Chi-square: 43.714



71

BANKINGHOURS


POOR 3 17.5 -14.5


GOOD 32 17.5 14.5


Total 70

Chi-square: 26.343



72

SECURITY


POOR 5 17.5 -12.5


GOOD 34 17.5 16.5


Total 70

Chi-square: 24.971



73

SECURITYARCHITECTURE


POOR 5 17.5 -12.5

SATISFACTORY 17 17.5 -.5

GOOD 31 17.5 13.5


Total 70

Chi-square: 19.371



74

CUSTOMERLOYALTYPROGRAMME


VERY POOR 1 14.0 -13.0

POOR 2 14.0 -12.0


GOOD 39 14.0 25.0


Total 70

Chi-square: 76.143



75

PERSONALIZATION


VERY POOR 1 14.0 -13.0

POOR 4 14.0 -10.0


GOOD 31 14.0 17.0


Total 70

Chi-square: 46.286



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CREDITWORTHINESS


POOR 3 17.5 -14.5


GOOD 36 17.5 18.5


Total 70

Chi-square: 33.429



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GRIEVANCEHANDLING


VERY POOR 2 14.0 -12.0

POOR 3 14.0 -11.0


GOOD 27 14.0 13.0


Total 70

Chi-square: 43.714



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OVERALLEXPERIENCE


POOR 2 17.5 -15.5

SATISFACTORY 18 17.5 .5

GOOD 41 17.5 23.5


Total 70

Chi-square:49.429



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ANALYSIS: We have formulated a null hypothesis, H0, for all the above mentioned 19 variables and then taking 5% as the level of significance we have tested all these 19 hypotheses on the basis of the fact that:

If, p<0.005(level of significance), then the null hypothesis is rejected and the alternate hypothesis, HA is accepted.

All the 19 variables have their null hypotheses and alternate hypotheses formed on the underlying concept:

H0 = The concerned variable does not has a significant role to play in enhancing the customer retention of Kotak Mahindra Bank.

HA = The concerned variable has a significant role to play in enhancing the customer retention of Kotak Mahindra Bank.

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FINDINGS:-On the basis of our analysis we have found that for all the 19 variables, the value of p calculated with the help of chi-square is less than 0.005, hence the null hypotheses formulated with respect to all the 19 variables have been rejected and hence all the 19 respective alternate hypotheses of the respective 19 variables are accepted.

Hence, it is found that on the basis of the value of chi-square the importance of the important variables that enhances the customer retention of Kotak Mahindra Bank in the order of their priority is as follows:

1. Customer Loyalty Programs2. Overall Experience3. Competitiveness of the bank’s products and services4. Personal Attention paid to the customers5. Quality of products and services being offered6. Accessibility7. Grievance Handling and Settlement8. Pricing9. Convenience10. Serviceability11. Staff availability12. Responsiveness13. Banking Hours14. Creditworthiness15. Security16. Distinctiveness17. Service speed18. Security architecture of online banking

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CHAPTER 6

CONCLUSION AND RECOMMENDATIONS

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CONCLUSION: Hence, on the basis of a detailed analysis of all the important parameters taken under consideration for their significant roles in enhancing customer retention strategy of Kotak Mahindra Bank, I arrive at the conclusion that Customer Loyalty Programs are the best way to ensure and to enhance customer retention in a banking organization because of the fact that in case of service industries like banking organizations, the product is of highly intangible nature and the whole confidence of the consumer over the performance of the product depends upon the trust of the organization with the customer. Hence, in order to provide the customer a strong bonding of trust and loyalty towards the customer, it is necessary to conduct customer loyalty programs for the existingcustomers of the organization in order to ensure the benefits of customer retention. Apart from this, one more important conclusion from the above study that can be drawn is that in case of banking sector, the customer should be provided with an overall satisfactory experience through standardized service in a personalized manner with the bank employee having an equal blend of sales orientation as well as service orientation with a proper attitude to serve. It can be finally concluded that Kotak Mahindra Bank is having a very high degree of customer satisfaction due to which it has been able to successfully retain its existing customers and hence enjoying the competitive advantage of customer loyalty over its other competitors.

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RECOMMENDATIONS: I would like to make the following recommendations:

1. More emphasis should be given towards the integration of Customer Loyalty Programs with the performance evaluation of the employees of the bank in order to increase their willingness to perform these programs.

2. The bank should look forward to start loyalty programs for its marketing intermediaries.3. The bank should look forward to increase the frequency of customer rater scale

evaluation of its employees in order to keep a regular check on the customer’s satisfaction level with the bank employees.

4. The bank should should emphasize on more customized services to its premium customers.

5. The bank should focus on a proper training program for all its employees in order to acquaint them with an attitude to serve.

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CHAPTER 7

LIMITATIONS

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LIMITATIONS

Despite of all my sincere and honest efforts to ensure maximum comprehension,

the study could not be made that comprehensive due to time constraints. Some customers feel

uncomfortable to reveal some personal information relating to income, Privacy etc. it might have

happened that some more essential information could have been collected.

Time constraint.

Biases and non-cooperation of the respondents.

Financial constraint leading to inability to provide some motivational hampers to the

respondents to ensure proper response.

Geographical selectivity in study limiting to Indore city only.

People are not interested in giving personal opinions.

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QUESTIONNAIRE

Dear Respondent,

I am a student of MBA [(FULLTIME) MAJOR- MARKETING] from INSTITUTE OF MANAGEMENT STUDIES (IMS) DAVV; INDORE.I am undertaking a major research project work on “Customer Retention Strategy of Kotak Mahindra Bank”. I would be grateful if u you could spare a few minutes to complete this structured questionnaire in order to help me in completing my research work .Whatever the personal information would be provided by you will be kept confidential and used for research purpose only.

Name:

Contact No. :

Address (optional):

1. Please specify your Gender:-1. Male 2.Female

2. Please specify the age group which you belong to:-

1. 15-25 years 2. 26-35 years 3.36-45 years 4. 46 and above

3. Please specify your occupation:-

1. Agriculture 2. Business 3.Government Job 4. Private Sector

5. Others

4. Please specify your reason for visit to the branch:-

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1. Enquiry 2. Deposit/Withdrawal 3. Loan 4. Other Services

5. Please specify your annual income (optional):-

1. 1 lac to 1.5 lac 2. 1.5 lac to 2.5 lac 3.2.5 lac to 5 lac 4. 5 lac and above

6. Please specify your status with the bank:-

1. Employee 2. Customer 3. Market Intermediary 4. Visitor

Please tick the appropriate number to indicate your degree of satisfaction on the 5 pointer scale given

Where: - 5 = Excellent 4 = Good 3 = Satisfactory 2 = Poor 1 = Very Poor

7. How do you rate the responsiveness of the bank employee in dealing with you?

1 2 3 4 5

8. How do you rate the products and services offered and did they meet your needs and expectations regarding quality and performance?

1 2 3 4 5

9. How do you rate the competitiveness of the products and services offered and do they present best value of total cost of lifetime ownership?

1 2 3 4 5

10. How do you rate the banking staff on their knowledge about the products and services offered by the bank?

1 2 3 4 5

11. How do you rate the speed of service offered to you by the bank?

1 2 3 4 5

12. How do you rate the availability of staff in the bank?

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1 2 3 4 5

13. How do you rate the availability of differentiated products and services of the bank in the crowded market?

1 2 3 4 5

14. How do you rate the convenience offered by the bank in branch banking as well as through its various points of interaction with the bank?

1 2 3 4 5

15. How do you rate the accessibility of multiple banking channels offered by the bank?

1 2 3 4 5

16. How do you rate the serviceability of multiple banking channels offered by the bank?

1 2 3 4 5

17. How do you rate the pricing of various products and services offered by the bank?

1 2 3 4 5

18. How do you rate the banking hours provided by the bank?

1 2 3 4 5

19. How do you rate the security of the bank?

1 2 3 4 5

20. How do you rate the security architecture of net banking facility of the bank?

1 2 3 4 5

21. How do you rate the customer loyalty programmes offered by the bank?

1 2 3 4 5

22. How do you rate the personal attention provided to you by the bank through all of its banking channels?

1 2 3 4 5

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23. How do you rate the creditworthiness of the bank?

1 2 3 4 5

24. How do you rate the grievance handling and settlement activity of the bank?

1 2 3 4 5

25. How do you rate the overall experience with the bank?

1 2 3 4 5

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CHAPTER 8

REFERENCES AND BIBLIOGRAPHY

91

BIBLIOGRAPHY

There was immense need and flow of the information while conducting the analysis as

well as while writing the thesis report, which was gathered through various sources

mentioned below:

FOR PRIMARY DATA:

NON-DISGUISED STRUCTURED QUESTIONNAIRE FILLED AT KOTAK MAHINDRA

BANK, M.G. ROAD BRANCH, INDORE

FOR SECONDARY DATA:

Various Magazines and Newspapers

Outlook- Sept 2011 edition, page no. 28-29

Financial Times- January 2012 edition, page no. 45

The Times of India- February 8, 2012

The Hindustan Times- February 22, 2012

Internet

www.Kotak.com

(data collected on 3rd march and 11th April 2012)

www.wikipedia.com

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http://www.wikipedia.com/

http://www.Kotak.com/

REFERENCES:

JOURNALS: – 1. Indian Journal of Finance, January 2012 edition

2. Journal of Indian Bank Association, august 2011 edition3. IUP Journal of Business Strategy, November 2011 edition

Brochures and various other documents gathered and collected from bank and various other sources such as ATM centers and associates.

BOOKS:- Kothari C.R et.al; Research Methodology, New Age International Publishers, 8TH Edition, 2010

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