Jour of Adv Research in Dynamical & Control Systems, 05-Special Issue, July 2017

Customer’s Satisfaction on Primary

Agricultural Credit Co-Operative Societies
Dr.R. Velmurugan, Associate Professor, Commerce, Karpagam University, Karpagam Academy of Higher Education,
Coimbatore. E-mail:drvelsngm@gmail.com
V. Gopinathan, Ph.D.(PT) Research Scholar, Commerce, Karpagam University, Karpagam Academy of Higher Education,
Coimbatore. E-mail:rsvgopinathan@gmail.com
Abstract--- Business units or financial institutions can not survive, unless they satisfy their customer’s expectations.
Only satisfied customers will transact business continuously and recommend for transacting business at societies
with their friends and relatives. Each and every financial institution adopts their own strategies for fulfilling their
customer’s expectations and tries to retain existing customers and to attract new ones. Thus, in this study an attempt
has been made to ascertain the factors influencing customer’s satisfaction and to offer suggestions for enhancing
customer’s satisfaction. The result of the study portrays that area of residence, age, educational qualification,
occupation, monthly income, family income, type of family, level of awareness and level of perception on service
quality are the factors associated with customer’s satisfaction.
Keywords--- Customer’s Satisfaction, Co-operative Societies, Service Quality.

I. Introduction
Since the beginning of 20th century, majority of economically advanced countries have changed from being
principally manufacturing-based to service-based. Service industries have turn into a chief element in the economic
growth of most countries across the world. As competition intensifies and governments continue to deregulate
service industries, many service providers seek to distinguish themselves by guaranteeing customer satisfaction and
by offering better service quality. Fulfilling customer anticipations is the major aim for all service oriented
organization. Dissatisfaction paves way for poor customer base. While there is intensive competition, even a meager
level of dissatisfaction may lead to loss of customers. High customer satisfaction attracts new customers and helps to
retain existing ones. Customer satisfaction can be experienced in a variety of situations and connected to both goods
and services.
It is a highly personal assessment that is greatly affected by customer expectations. Satisfaction also is based on
the customer’s experience of both contacts with the organization and personal outcomes. The existing evidence
suggests that customer satisfaction is likely to come from interest rate and safety standards in transactions (Rajeev
Kumar Panda, Rama Koteswara Rao and Kondasani, 2014), delivery of innovative products (Kailash, 2012),
reliability and service interaction (Arora Vibha, Nravichandran and Jain. 2011), quality of service offered
(Aleksandra Pisnik Korda and Boris Snoj, 2010), courtesy and helpfulness of employees and availability of self-
banking services (Abdulkarim S. Al-Eisa and Abdulla M. Alhemoud, 2009).

II. Review of Literature

Velmurugan, R and E. Vanitha (2015) in their study identifies that area of residence, gender, educational
qualification, family income, duration of holding accounts and perception on service quality is associated with
customer satisfaction. Vinita Kaura (2013) identifies that except tangibility all the other dimensions have positive
impact on customer satisfaction in public sector banks and in case of private sector banks benefit convenience and
tangibility does not have a positive impact on customer satisfaction. Murugan (2012) finds that the customers of
public sector banks are more satisfied than the customers of private sector banks as regards service quality. Jaspal
Singh and Gagandeep Kaur (2011) reveals that responsiveness, tangibles, services innovation, reliability and
accessibility, assurance, pricing and other facilities, problem solving capability and convenient working hours are
the main determinants of customer satisfaction. Monica Bedi (2010) in her study found that Service Quality
dimensions were found to be statistically significant in public and private banks and customer satisfaction was
strongly associated with propensity to recommend. Khan et. al., (2009) shown that customers are satisfied with
quality of service on four dimensions such as reliability, accessibility, privacy/security, responsiveness and
fulfillment.

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III. Statement of the Problem

Today, PACS in India face a stiff competition from both Public, Private and Foreign bankers, resulting in
reduction of customer size and erosion of profitability. In order to survive in the competitive scenario, PACS also
have to introduce new innovative products as introduced by Public sector and private sector banks and should
increase the satisfaction level of their customers. Customer satisfaction depends on safety standards adopted in the
bank (Rajeev Kumar Panda, Rama Koteswara Rao and Kondasani, 2014), convenience and tangibility (Vinita
Kaura, 2013), reliability and competitiveness (Premraj H and Sankaralingam, N, 2012), Employee behavior and
competency level of bank staff (Majid Esmailpour, Manije Bahraini Zadeh and Effat Haji Hoseini, 2012), Delivery
of innovative products by banks (Kailash, 2012). Thus, the present study is carried out to find out the factors which
influence the customer satisfaction.

IV. Objective of the Study

To ascertain factors influencing Customer Satisfaction towards PACS service

V. Scope of the Study

The present study has been confined to Customer’s Satisfaction of Primary Agricultural Credit Co-operative
Societies located at Coimbatore district of Tamilnadu alone.

VI. Research Methodology

Data
Data required for the study is primary in nature. Thus, primary data is collected by making use of questionnaire.
Questions pertaining to personal profile of customers, and customer’s satisfaction are included in the questionnaire.
Pilot Study
A preliminary study has been conducted with 50 PACS customer’s before finalizing the Questionnaire.
Similarly, the questionnaire has been circulated among few PACS officials and academic experts. With reference to
Questionnaire filled-in by PACS customers and feedback received from both PACS officials and academic experts
necessary alterations are incorporated before finalizing the Questionnaire.
Sample Design
By adopting convenient sampling method questionnaires are distributed to 800 PACS customers. Of which, 78
customers have not returned their questionnaires and 19 customer’s have not fill the questionnaires in full. Hence,
the 703 forms the sample size of the study.
Framework of Analysis
The collected data have been analyzed by making use of Chi-square test.

VII. Analysis and Interpretation

Customer Satisfaction on PACS Service has been measured by assigning scores to questions relating to
Satisfaction. Thirty such questions are included in the questionnaire. Answers to the questions have been rated on a
five-point scale. The scores allotted to the answers range from one to five. Thus, the maximum score a customer
would get is One hundred and fifty.
Score obtained by each customer is divided by 150 and multiplied by 100 to convert it into an index. This index
is termed as ‘Satisfaction index’. The index ranges between 20.00 and 100.00 and the grand mean of satisfaction
index is 80.80. Of the 703 customers, 332 (47.20%) are with satisfaction indices above the average and 371
(52.80%) are with satisfaction indices below the average. Based on the satisfaction index, the customers have been
divided into three groups as customers with low, moderate and high level of satisfaction. In order to classify the
customers into three such groups, quartiles have been made use of. Accordingly, customers with satisfaction index
ranging up to 67.76 are termed as customers with low level of satisfaction; those with satisfaction index ranging
between 67.77 and 93.83 are termed as customers with moderate level of satisfaction and those customers with
satisfaction index above 93.83 are termed as customers with high level of satisfaction. Of the 703 customers, 106
(15.10%) customers are with low level of satisfaction; 470 (66.90%) are with moderate level of satisfaction and the
rest 127 (18.10%) customers are with high level of satisfaction.

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Table 1: Factors Influencing Customer’s Satisfaction

Level of Satisfaction
Variables Total Chi-square
Low (n=106) Moderate(n=470) High(127)
Area of Residence
Urban 30 (45.50) 28 (42.40) 8 (12.10) 66 (100.00) 55.588**
Semi-urban 12 (18.80) 43 (67.20) 9 (14.10) 64 (100.00)
Rural 64 (11.20) 399 (69.60) 110 (19.20) 573 (100.00)
Age
Up to 30 30 (24.00) 69 (55.20) 26 (20.80) 125 (100.00) 13.013*
31 to 50 64 (13.70) 319 (68.30) 84 (18.00) 467 (100.00)
Above 50 12 (10.80) 82 (73.90) 17 (15.30) 111 (100.00)
Gender
Male 86 (16.10) 354 (66.40) 93 (17.40) 533 (100.00) 2.161
Female 20 (11.80) 116 (68.20) 34 (20.00) 170 (100.00)
Educational Qualification
Illiterate 19 (11.30) 113 (67.30) 36 (21.40) 168 (100.00) 76.035**
SSLC 15 (09.10) 128 (78.00) 21 (12.80) 164 (100.00)
H.Sc., 19 (11.80) 123 (76.40) 19 (11.80) 161 (100.00)
Diploma 4 (09.50) 28 (66.70) 10 (23.80) 42 (100.00)
Under Graduate 23 (22.30) 51 (49.50) 29 (28.20) 103 (100.00)
Post Graduate 24 (46.20) 18 (34.60) 10 (19.20) 52 (100.00)
Professional 2 (15.40) 9 (69.20) 2 (15.40) 13 (100.00)
Occupation
Agriculturists 43 (10.70) 286 (71.00) 74 (18.40) 403 (100.00) 33.897**
Business 2 (10.00) 14 (70.00) 4 (20.00) 20 (100.00)
Employee 47 (27.30) 104 (60.50) 21 (12.20) 172 (100.00)
Homemaker 9 (13.20) 43 (63.20) 16 (23.50) 68 (100.00)
Student 2 (11.80) 9 (52.90) 6 (35.30) 17 (100.00)
Self-employed 3 (13.00) 14 (60.90) 6 (26.10) 23 (100.00)
Monthly Income
Up to 10000 27 (11.10) 196 (80.70) 20 (08.20) 243 (100.00) 68.731**
10001 – 20000 30 (12.20) 176 (71.50) 40 (16.30) 246 (100.00)
Above 20000 49 (22.90) 98 (45.80) 67 (31.30) 214 (100.00)
Family Income
Up to 15000 38 (10.80) 277 (78.50) 38 (10.80) 353 (100.00) 73.873**
15001 – 30000 34 (16.70) 135 (66.20) 35 (17.20) 204 (100.00)
Above 30000 34 (23.30) 58 (39.70) 54 (37.00) 146 (100.00)
Type of Family
Joint 38 (18.00) 124 (58.80) 49 (23.20) 211 (100.00) 9.107*
Nuclear 68 (13.80) 346 (70.30) 78 (15.90) 492 (100.00)
Level of Awareness
Low 32 (25.60) 86 (68.80) 7 (05.60) 125 (100.00) 117.577**
Moderate 72 (16.40) 312 (71.20) 54 (12.30) 438 (100.00)
High 2 (01.40) 72 (51.40) 66 (47.10) 140 (100.00)
Level of Perception on Service Quality
Low 82 (70.10) 33 (28.20) 2 (01.70) 117 (100.00) 489.991**
Moderate 24 (05.30) 379 (84.20) 47 (10.40) 450 (100.00)
High 0 (00.00) 58 (42.60) 78 (57.40) 136 (100.00)
* Significat at 5% level ** Significant at 1% level
• Customer’s who reside in rural area have high level of satisfaction and customer’s who reside in urban area
have low level of satisfaction.
• Customer’s who are within the age of 30 years have high level of satisfaction. Customers who are within the age
of 30 years are with low level of satisfaction. Comparing the percentage, it is inferred that customers, who are
within the age of 30 years are with low level of satisfaction.

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• The percentage of customers with high level of satisfaction is found high among under graduate qualified
customers. The percentage of customers with low level of satisfaction is found high among post graduate
qualified customers.
• Students have high level of satisfaction whereas, employees are with low level of satisfaction towards
service quality offered at PACS.
• Customers, whose monthly income ranges above Rs. 20000 are with high level of satisfaction and
customers, whose family income ranges above Rs.30000 are with high level of satisfaction.
• The percentage of customers with high level of satisfaction is found high among customers, who belong to
joint family. The percentage of customers with low level of satisfaction is also found high among customers,
who belong to joint family. Comparing the percentage, it is inferred that customers, who belong to joint
family are with high level of satisfaction.
• The percentage of customers with high level of satisfaction is found high among customers, who are with
high level of awareness on schemes offered by PACS. The percentage of customers with low level of
satisfaction is found high among customers, who are with low level of awareness on schemes offered by
PACS.

VIII. Suggestions
• Customers, who reside in urban area, have low level of satisfaction towards PACS service. In order to raise
their satisfaction and survive in competition, PACS should then and there introduce new schemes and
products as like public and private sector banks
• Customers, who are within the age of 30 years, have low level of satisfaction towards PACS service. Now-
a-days, youngster prefers to carryout majority of their transaction through net banking. Hence, it is
suggested to incorporate net banking facility at PACS by incorporating core banking concept in PACS.
• Customers, who have low level of awareness on PACS schemes has low level of satisfaction. It is
recommended that the PACS should provide attractive and informative materials along with the services.
Further, PACS employees must show genuine interest towards the customers.
• Customers, who have low level of perception on PACS services has low level of satisfaction. There is a
strong association between service quality dimensions and customer satisfaction. The high service quality
leads to customer satisfaction. Instead of concentrating on other promotional activities PACS can improve
the service quality which leads to customer satisfaction and satisfied customers are word of mouth for the
prospect. In today’s Competitive environment, it is not enough for the PACS to satisfy the customers but to
delight them by providing unexpected services.

IX. Conclusion
In reality no service sector can continue active without the customers. This is absolutely truthful, as customer
value is an asset to the organization. Hence, with the purpose of upholding customer, the PACS necessitate offering
right form of products and services, which are easily accessible to the customers. PACS that satisfy customers`
requirements will inevitably enlarge the trustworthiness of their customers, which resultant in repeated business.
Accordingly, it is pertinent that PACS should continually be acquainted with their customers’ anticipation by
establishing proficient relationship with their customers. When officials of PACS starts focusing on delivering what
is of value to their customers, this will generate the potential for repeat business too. The result of the study
highlights better service quality leads to higher level of customer satisfaction. Hence, it is the need of the hour for
PACS to devise appropriate plans to keep their existing customers and to attract new customers by offering novel
services in accordance with their customer’s expectations.

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