A comparative study of customer satisfaction of SBI, Indian Bank,

ICICI &HDFC ATM cum Debit Cards

Author's Name: Arun Baby

Author's Title/Affiliation: MBA Student, VIT Business School, VIT University, Vellore
-632 014
Postal Address: Kallidukil house, College Road Thodupuzha East P.O. Kerala, India.
Email: arunbaby1234@yahoo.com
Brief Biographic Description: Arun Baby is an Electrical Engineer worked as an engineer
in Kerala State Electricity Board for one and a half years.He is currently doing his MBA in
VIT B-School, VIT University Vellore , India.

Abstract
The Automated Teller Machine (ATM) is one type of innovation that can
mechanically accept deposits, issue withdrawals, transfer funds between
accounts, collect bills, and make small loans. This study aims at investigating the
satisfaction levels of ATM facility by the customers of four different banks. This
study provides information for analyzing ATM services of SBI, Indian Bank, ICICI
and HDFC. This study helps the banks for better customer service and for being in
a better competitive position.

Keywords: Automated Teller Machine (ATM), Customer satisfaction, User

friendliness, Interruption, Cash withdrawal.

Introduction
Technology is revolutionizing the financial services industry through various unthinkable
innovations. The volume of cross-border trading and other financial activities is
increasing geometrically facilitated by technology. The influence of technology over
product innovations in banks is enormous. In innovation process banks have to decide
which products they wish to sell, whether they wish to build those products themselves,
how they should deliver, and why they wish to deliver them to customers. Innovation is
the art of overcoming constraints toward development. It occurs when a new or changed
product or service is introduced to the market, or when a new or changed process is
used in a commercial situation. No organization can remain happy with the existing
products to cope with the competitors. Banks are no exception to this situation. The
Automated Teller Machine (ATM) is such type of innovation that can mechanically accept
deposits, issue withdrawals, transfer funds between accounts and collect bills. They
provide market with better services 24 hours-a-day, and 7 days-a-week. Today almost all
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banks provide ATM facility

Review of literature
Robert Rugimban (1995) in his article reports the findings of a study where retail banking
consumers’ perceptual characteristics were contrasted with commonly used respondent
demographic characteristics, in terms of predictive efficacy. The overall aim of this study
was to discriminate users and non-users of automated teller machines (ATMs) using
both characteristics of respondents as well as their perceptions of ATM attributes, with a
view to assessing the relative importance of these predictor variables

Paul Walley et al (1994) in their article concentrates on front office technology, partly
neglected aspect of service operations and seeks to evaluate the future scope for front
office technology. The problems and benefits of front office automation are evaluated
and a conceptual framework of the technology/customer interface is derived.

Robert Rugimbana et al (1994) conducted a study. The overall aim of this study was to
determine retail bank consumers’ usage patterns of ATMs and whether these are
associated with their perceptions of the attributes of ATMs. The present study was
initiated in response to the apparent lacuna on consumer perceptions, and examines the
ATM usage patterns of two banking institutions with a view to assess the relative
importance of the different perceptual variables in explaining consumer usage patterns

Mark M.H. Goode et al (1996) Tests a hypothesized model which measures the overall
satisfaction gained from, and the full spectrum of services attached to, the use of
automated teller machines (ATMs). They found out that the overall satisfaction is the end
result of a combined number of antecedents. Overall, establishes a number of important
structural links within the model which suggest that if banks wish to increase customers’
overall satisfaction and the usage of available services they must target factors which
directly affect customers’ expectations and perceived risk.

Umberto Filotto et al (1997) studied and analyses both payment services and sales and
private banking areas. In the former, human contact attributes of service prove to be
overemphasized when customer satisfaction is observed. In the latter, technology seems
extremely important in helping bank branch officers decide which new services to offer to
which customers. In both sections customers’ clusters are identified according to the
importance of different service attributes; subsequently, they are described in terms of
demographic, behavioral and psychographic characteristics. Technology-oriented
unsatisfied customers seem to belong to most segments. This calls for a major shift in
the approach to delivery channels the majority of Italian banks are still adopting.

M. Knahl et al (1999) said that ATM and other networking technologies will coexist in
networks and have to interoperate to guarantee existing services and allow future
services. It is proposed that future work should move on from existing network and
system management methodologies to consider enhancing the management
methodology for ATM and other networking technologies to meet existing and future
requirements. This paper outlines an area where significant potential for further research
exists and proposes a component based management architecture. The discussion
indentifies the technological limitations and architectural drawbacks of current solutions
and proposes the extension of existing services and an enhanced management
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framework to overcome the current restrictions.

Gerard Prendergast et al (1994) said that today, a bank may indeed have branches, but
with increasing technological advances it may also be represented by a telephone in the
customer’s home, a plastic magnetic stripe debit card, or a self-service cash dispensing
machine on the street. In the light of these developments, one needs to question the
future of bricks-and-mortar branches. One of the methods of obtaining and retaining
customers is for banks to provide increased convenience in banking via self-service
technology at the customer interface.

Jason Ramsay et al (1999) found out that since deregulation in the mid- 1980s the
banking industry in Australia has become increasingly competitive. Increased
competition, weakening interest rates, squeezed profit margins and the surge of
mortgage originators into a traditional banking market have all prompted a search for
new and innovative methods of improving internal efficiency like ATMs, leading to the
development of new banking products and the exploration of alternate delivery methods,
or channels. Improvements in technology are facilitating this development and their
paper examines the implications both for customers and for bank profitability

John Lynch (1995) said that ATM is the coming network technology. It is true that ATM
offers the potential of huge bandwidth but the question is -Is now the time to change?
After all, the ATM standards have not all been ratified and all suppliers have an element
of proprietary technology in their kit. Thus asynchronous transfer mode (ATM) is an
emerging rather than an existing technology. It would be useful to see some ATM
networks in use, not just on paper. This paper is on the emerging technology and
applications.

Steve Worthington et al (2005) in their paper explore the opportunities and challenges
for “foreign” financial institutions who wish to enter the Chinese market. It uses the credit
card product to illustrate the complexities of this market

A Nomiyama et al (2001) in their article deals with new development in ATM machine
technology. In Japan, some ATMs can re-dispense deposited bills. Such ATMs are called
‘‘circulation ATMs’’. This ATM has two kinds of cassette. The so-called ‘‘circulation
cassette’’ can accept and re-dispense bills. Each circulation cassette accepts only one
denomination, which is reused for withdrawal. The other cassette, called a ‘‘deposit
cassette’’, only accepts bills. The deposit cassette accepts any denominations, which are
not reused for withdrawal

Objectives of the Study

 To compare the costumer satisfaction of ATM users of SBI, Indian Bank, ICICI and
HDFC.
 To study whether there is any relation between gender and age on customer
satisfaction of ATM users.

 To study whether there is any relation between ATM cards of different Banks and
user friendliness of the machine, cleanliness of the ATM counter, occurrence of fault
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(debiting the account without dispensing cash), and customer satisfaction with upper
limit of cash withdrawal, interruption due to maintenance of the ATM machine.

 To find out relation between occupations of the ATM card holder and usage of
different options available in the ATM card, the reason for reluctance of not using of
different options available in it.

Research Methodology

The survey was done among people who are in and around Vellore town, Tamil Nadu,
India. Structured Questionnaire method was followed for data collection. On-the-spot
sampling technique was used in determining sample size. The sample size is 300. The
questionnaires were circulated among the respondents and were filled by the
respondents. The various statistical tools used in this descriptive study are chi-square
test, correlation, Kruskal-Wallis test, one-way ANOVA. For the analysis of the collected
data SPSS software was used.

Data Analysis & Interpretation

Correlation Analysis:
Relationship between age of the Customer and ATM card used by them

Corre lat ions

age atmcard
Pearso n age 1.000 .111
Co rrelatio n atmcard .111 1.000
Sig. age . .055
(2- tailed) atmcard .055 .
N age 300 300
atmcard 300 300
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Inference:
Since the correlation value is 0.111 lies between 0 and 0.25, there is low positive
correlation between age of the customer and ATM card used by them.
The authors also found that there is low negative correlation between gender and
opinion regarding privacy provided at the ATM counter.
The Study also reveals that there is low negative correlation between gender and
location of ATM counter

Chi-square Test
Association between the response towards ATMs of different bank and user
friendliness of the machine
Ho: There is no significant difference between ATMs of different bank and user
friendliness of the machine.
Chi- Square T e st s

Asymp.
Sig.
Value df (2- sided)
Pearso n a
36.533 9 .000
Chi- Square
Likeliho o d Ratio 35.094 9 .000
Linear- by- Linear
.335 1 .563
Asso ciatio n
N o f Valid
300
Cases
a. 4 cells (25.0%) have expected co unt less than 5.
T he minimum expected co unt is 1.25.

Directional Measures

Asymp. Approx.
Value Std. Error Approx. T Sig.
Nominal Lambda Symmetric .097 .047 2.011 .044
by userfrie
Nominal .044 .061 .718 .473
Dependent
atmcard
.129 .053 2.306 .021
Dependent
Goodman userfrie
.048 .021 .000
and Dependent
Kruskal atmcard
tau .041 .010 .000
Dependent
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Symmetric Measures

Approx.
Value Sig.
Nominal by Phi .349 .000
Nominal Cramer's
V .201 .000
N of Valid Cases
300

Inference:
The Chi-Square significant value is 0.000 which is less than the hypothetical value 0.05.
Hence, there is significant difference between ATMs of different bank and user
friendliness of machine. Also, there is 4.4% reduction in error in predicting relation
between user friendliness of ATM machine of different banks.
Since the Cramer-V value 0.201 lies between 0-0.25, the relationship between ATMs of
different bank and user friendliness of the machine not significant.
The authors also found that there is no significant difference between ATMs of different
banks and interruption due to maintenance of the ATM machine. Also, there is 10.6%
reduction in error in predicting relation between ATMs of different banks and interruption
due to maintenance of the ATM machine.
The study also reveals that there is significant difference between occupation and
number of ATM card holders in the family. Also, there is 16.8% reduction in error in
predicting relation between occupation and number of ATM card holders in the family.

ANOVA:
Variance between the response towards ATMs of different banks and their
cleanliness
Ho: there is no significant difference between ATMs of different banks and their
cleanliness.

Oneway

ANO VA

Sum o f Mean
Squares df Square F Sig.
cleanlin Between
20.520 3 6.84 0 17 .295 .000
Gro ups
Within
117 .067 296 .395
Gro ups
T o tal 137 .587 299
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Inference:
Since the F- test value 17.295 greater than the hypothetical value 0.05, accept Ho.
There is no significant difference between ATMs of different banks and their cleanliness.
The authors also found that there is no significant difference between ATMs of different
banks and occurrence of fault.
The study also reveals that there is no significant difference between ATMs of different
banks and customer satisfaction with upper limit of cash withdrawal.

Kruskal Wallis Test:

Irrespective of number of card holder in a family, the ATM cards for different banks are
same.
Irrespective of the persons in the family who have ATM cards, the ATM cards for different
banks are same.

Kruskal-Wallis Test
Ranks

Mean
atmcard N Rank
no atmhld sbi 75 17 1.51
indian 75 156.13
icici 75 125.61
hdf c 75 14 8.7 5
T o tal 300
o therhld sbi 75 17 0.31
indian 75 150.30
icici 75 128.29
hdf c 75 153.11
T o tal 300

a,b
T e st St at ist ics

no atmhld o therhld
Chi- Square 12.137 8.993
df 3 3
Asymp. Sig.
.007 .029

a. Kruskal Wallis T est

b. Gro uping Variable: atmcard

Inference:
The significance value 0.007 is lesser than hypothetical value. Thus Irrespective of
number of card holder in a family, the ATM cards for different banks are not same.
Hence there is no significant difference between number of card holder in a family and
the ATM cards for different banks.
The significance value 0.029 is lesser than hypothetical value. Thus Irrespective of the
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persons in the family who have ATM cards, the ATM cards for different banks are not
same. Hence there is no significant difference between the persons in the family who
have ATM cards and the ATM cards for different banks.
The authors also found that there is no significant difference between the occupation of
the ATM card holder and usage of different options available in it.
The study also reveals that there is a significant difference between the occupation of
the ATM card holder and the reason for reluctance of not using of different options
available in it.

Discriminant Analysis

Analysis Case Proce ssing Summary

Unweighted Cases N Percent

Valid 299 99.7
Excl Missing o r
uded o ut- o f - range 1 .3
gro up co des
At least o ne
missing
0 .0
discriminating
variable
Bo th missing
or
o ut- o f - range
gro up co des
0 .0
and at least
o ne missing
discriminating
variable
T o tal 1 .3
T o tal 300 100.0

Group St at ist ics

Valid N (listwise)
useino tr Unweighted Weighted
yes age 193 193.000
inco me 193 193.000
no age 106 106.000
inco me 106 106.000
T o tal age 299 299.000
inco me 299 299.000

Analysis 1
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Summary of Canonical Discriminant Functions

Eigenvalues

% of Cumulative Canonical
%
Function Eigenvalue Variance Correlation
1
.013 100.0 100.0 .112

Wilks' Lambda

T est o f Wilks'
Functio n(s) Lambda Chi- square df Sig.
1 .987 3.7 31 2 .155

St andardize d
Canonical
Discriminant Funct ion
Coe f f icie nt s

Functio n
1
age - .596
inco me .993

St ruct ure Mat rix

Functio n
1
inco me .821
age - .310

Po o led within- gro ups

co rrelatio ns between
discriminating
variables and
standardized canonical
discriminant f unctio ns
Variables o rdered by
abso lute size o f
co rrelatio n within
f unctio n.
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Canonical Discriminant
Funct ion Coef f icie nt s

Functio n
1
age - .817
income 1.295
(Co nstant) - 1.509
Unstandardized
co ef f icients

Funct ions at Group

Ce nt roids

Functio n
useino tr 1
yes 8.319E-02
no - .151
Unstandardized
cano nical discriminant
f unctio ns evaluated at
gro up means

Classification Statistics

Classif icat ion Proce ssing Summary

Pro cessed 300

Excluded Missing o r
o ut- o f - range 0
gro up co des
At least o ne
missing
0
discriminating
variable
Used in Output
300
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Prior Probabilit ie s f or Groups

Cases Used in Analysis

useino tr Prio r Unweighted Weighted
yes .500 193 193.000
no .500 106 106.000
T o tal 1.000 299 299.000

Classif icat ion Re sultas

Predicted Gro up
Membership
useino tr yes no T o tal
Original Co unt yes 96 97 193
no 38 68 106
Ungro uped
1 0 1
cases
% yes 4 9.7 50.3 100.0
no 35.8 64 .2 100.0
Ungro uped
100.0 .0 100.0
cases
a. 54 .8% o f o riginal gro uped cases co rrectly classif ied.

Inference:
1) The discriminant function is able to classify 54.8% of the 300 objects correctly.

Statistical significance of the discriminant functions

2) In the above case Wilk’s Lambda value is 0.987, this means that the model has
less discriminating power.

3) P< 0.155 indicates that the F-test would be significant at a confidence level of up
to (1-0.155)*100 or 84.5% i.e. the F-test would not be significant at a confidence
level of 95%.

4) We have two independent variables age and income with one being a better
predictor of the attitude of staff behavior. From the standardized canonical
discriminant function coefficient value, the larger value will have the better
predicting power, thus in this income with the value of 0.993 will be the better
predictor.

5) The unstandardised discriminant function,

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Y= (-1.509)-0.817(age) +1.295(income)

Where Y is ATM card used in other bank’s ATM machine

Conclusion
The study indicates that age of the person does not have any impact in choosing the
ATM card. The gender of the customer does not have relation with their opinion
regarding the privacy provided at the ATM counter and the location of the ATM counter.
So this shows that gender and age factors have no impact on the customer satisfaction.
The study also indicates that there is significant relation between ATM cards of different
Banks and user friendliness of the machine. This shows that the customer satisfaction
depend on these factors. The another major observation is that there is no significant
relation between ATM cards of different Banks and cleanliness of the ATM counter,
occurrence of fault (debiting the account without dispensing cash), customer satisfaction
with upper limit of cash withdrawal, interruption due to maintenance of the ATM machine,
number of card holder in the customer’s family, member in the customer’s family who
has ATM cards. The study also indicates there is relation between occupation of the ATM
card holder and number of ATM card holders in the family and the reason for reluctance
of not using of different options available in it. There is no relation between the
occupation and usage of different options available in the ATM card. Thus the RBI norms
indicated that any customer of any bank can utilize the service of any bank. Hence the
bank should concentrate more in giving better service to all the customers, so that they
can get more volume of customers in future and hence they can lead in banking industry.

References
Robert Rugimban (1995), “Predicting automated teller machine usage: The relative
importance of perceptual and demographic factors” International Journal of Bank
Marketing, Vol. 13 No. 4, 1995, pp. 26-32

Paul Walley et al (1994), “Automation in a Customer Contact Environment” International

Journal of Operations & Production Management, Vol. 14 No. 5, 1994, pp. 86-100

Robert Rugimbana et al (1994), “Perceived Attributes of ATMs and Their Marketing

Implications” International Journal of Bank Marketing, Vol. 12 No. 2, 1994, pp. 30-35

Mark M.H. Goode et al (1996), “Structural equation modeling of overall satisfaction and
full use of services for ATMs” International Journal of Bank Marketing 14/7 [1996] 4–11

Umberto Filotto et al (1997), “Customer needs and front-office technology adoption”

International Journal of Bank Marketing 15/1 [1997] 13–21

Knahl M et al (1999), “A distributed component framework for integrated network and

systems management” Information Management & Computer Security 7/5 [1999] 254-
260
Gerard Prendergast et al (1994), “Towards a Branchless Banking Society?” International
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Journal of Retail & Distribution Management, Vol. 22 No. 2, 1994, pp. 18-26
Jason Ramsay et al (1999), “Managing customer channel usage in the Australian
banking sector”, Managerial Auditing Journal 14/7 [1999] 329-338

John Lynch (1995), “ATM finds an application” by John Lynch, Work Study, Vol. 44 No. 3,
1995, p. 19

Steve Worthington et al (2005), “Entering the market for financial services in transitional
economies” International Journal of Bank Marketing Vol. 23 No. 5, 2005 pp. 381-396

Nomiyama A et al (2001), “A stacking mechanism for setting bills upright in an automated

teller machine” Paper presented at the 12th Annual Symposium on Information Storage
and Processing Systems, Santa Clara, CA, USA, 28–29June, 2001.