SUMMER INTERNSHIP PROJECT REPORT

A study on

“DIGITALIZATION IMPROVED THE BANKING SERVICES WITH SPECIAL

REFERENCE TO HDFC BANK”

Submitted in partial fulfilment of the requirement for the award

of

“BACHELOR OF BUSINESS ADMINISTRATION”

(Session 2016-2018)

SUBMITTED BY
Rakshit Jain
BBA 5th Semester
UID:-K13327

UNDER THE GUIDANCE OF

Miss Mobina Akhtar

(Assistant Professor)
School of Commerce and Management

COMMERECE AND MANAGEMENT DEPARTMENT

CAREER POINT UNIVERSITY, KOTA
CERTIFICATE

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DECLARATION

I Rakshit Jain, hereby declare that the project entitled " DIGITALIZATION IMPROVED
THE BANKING SERVICES WITH SPECIAL REFRENCE TO HDFC BANK " has been
personally done by me under the guidance of Company Guide: Mr Aadarsh Mohale(Branch
Manager) and faculty Guide: Miss Mobina Akhtar(Assistant Professor) during the period
of 18th June 2018– 18th August 2018. This is submitted in partial fulfilment of the
requirements for the award of the certificate of Bachelor of Business Administration (BBA)
at CPU, Alaniya kota. All the data presented in this project is true and correct to the best of
my knowledge and belief.

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 ACKNOWLEDGEMENT

I am using this opportunity to express my gratitude to everyone who supported me throughout

the course of this project. I am thankful for their aspiring guidance and friendly advice during
the project work. I am sincerely grateful to them for sharing their truthful and illuminating
views on several issues related to the project.

I express my warm thanks to Mr. Aadarsh Mohale who not only acted as a mentor to me but
also supported as a guardian at HDFC Bank Ltd without him, the project would not have been
completed in such a graceful manner.

I would also like to express my gratitude to Head of Department Dr. Upasana Tyagi, Dr.(CS)
Pradyumna Sharma and my faculty guide Miss Mobina Akhtar for providing their
valuable reviews on my project and guiding me throughout the course of this internship.

My thanks and appreciation also goes to my colleagues in developing this project and providing
a helping hand with their abilities.

I am grateful to all the people who provided me with the facilities being required and
conductive conditions for this project.

Thank you,

Rakshit Jain

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 ABSTRACT

INDIAN RETAIL BANKING SECTOR

In the post-independence era the evolution and growth of banking sector has gone through
innumerable twists and turns.

In India banks are nationalised with the main objective of reaching out to the unbanked masses
and so retail banking is important in India to provide banking services to unbanked masses.

Retail banking in India is not a new phenomenon. It has always been prevalent in India in
various forms ever since banking was first established here.

Cooperative banks that have been in existence in India for over a century have always had
retail thrust. It is only since the mid-nineties that the term “retail banking” has been used as a
means of reinforcing a conscious foray into this line of business.

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The typical products offered in the Indian retail banking segment are housing loans,
consumption loans for purchase of durables, auto loans, credit cards and educational loans.
Unlike wholesale banking, retail banking has high sized business with many banks competing
for market share.

Retail banks focus mainly on consumer markets. Here the transactions of the banks are directly
with consumers and not with corporations or other banks. Nowadays much of retail banking is
streamlined electronically via ATMs, or through virtual retail banking known as online
banking.

The retail loan portfolio of Indian private sector banks has been growing speedily in the recent
past.

Banks are offering so many products to the customers and they can choose the one which suits
them. The Indian retail banking is expected to grow tremendously because of the changing
attitude of customers toward borrowings, low cost of borrowings and optimism regarding
economic growth.

Today’s retail banking sector is characterised by three basic features;

❖ Multiple products-deposits, credit cards, insurance, investment and securities

❖ Multiple channels of distribution- call centre, branch, internet, ATM.
❖ Multiple customer groups- retail segment, small business and corporates.

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DIGITALIZATION

It is the process of integrating information technology into everyday life by using the process
of digitization. Digitalization has helped the banking sector in various ways right from
organizing the customers to boosting their convenience for using the banking facilities. It has
also helped the employees to a great level aiming for the customer satisfaction.

OBJECTIVES:

❖ To analyse the use of digitalization in each and every sector of the branch banking.
❖ To study how digitalization is integrated after demonetization into the same process.
❖ To study the customer responses who have adopted digitalization as well those who
haven’t.
❖ To provide suggestions for the improvement in customer engagement.
❖ To understand operational and financial structure of bank.
❖ To get a better in-depth knowledge of Retail banking of Banking Industry.

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 EXECUTIVE SUMMARY

With the growing demands of customers, bank could not address each and every customer
personally, hence introduce the digital platform to cater each and every customer query. So,
the role of digital platform became pivotal. Now the main problem faced by customers was
lack of customers on digital side of banking. So, making the customers aware of the functions
and process of digital banking became of paramount importance.

Wherein the major task assigned to me in the digital platform.

As the banking industry is moving towards digitalisation, HDFC bank made its customers
mandatory to seed Aadhar card in bank accounts of customers by different means, took the
credit card holders who do not have accounts with the bank on digital base. After the GST act
was passed in July and the bank has enabled its customers to make the GST payment through
net banking by updating their GSN numbers. Helped the customers to renew their KYC and
assisting with the documentation while opening new accounts.

Understood the workflow of the bank as to how the bank operates its day to day functions. I
got an insight into the digital banking by making the people aware on digital base and making
them friendly with the banking transactions. Also got to learn different kind of forms and its
usage.

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TABLE OF CONTENTS

Training Certificate……………………………………………….…………..….2

Declaration……………………………………………………………………....3

Acknowledgement………………………………………………………….…....4

Abstract………………………………………………………………………….5

Executive Summary……………………………………………………………..8

Table of contents………………………………………………………………...9

1. HDFC BANK OVERVIEW

1.1 Company Profile…………………………………………………………...13

1.2 Business Focus……………………………………………………………..13

1.3 Market Leadership in E-commerce………..………………………………..14

1.4 Technology…………………………………………………………………15

1.5 Vision, Mission & Purpose…………………………………………………16

1.6 Benefits- Why Choose Us?............................................................................17

1.7 Limitation…………………………………………………………………..17

2. MARKETING MANAGEMENT IN BANKS

2.1 Definition…………………………………………………………………...18

2.2 Bank Marketing Concept…………………………………………………...18

2.3 Marketing Approach in Banks……………………………………………...19

2.4 Features- Bank Marketing…………………………………………………..20

2.5 Purpose- Bank Marketing…………………………………………………..20

2.6 Marketing Roles in Banks…………………………………………………..22

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 2.7 Bank Marketing Functions………………………………………………….23

2.8 Essence of Marketing in Banks………………………………………….….24

3. HDFC BANK – MARKETING MANAGEMENT& ANALYSIS

3.1 Key business Area…………………………………………………………..26

3.2 Marketing Mix 7P’s………………………………………………………...31

3.3 STP Analysis……………………………………………………….…….....40

3.4 Digital Marketing & HDFC bank…………………………………………...43

4. INNOVATIONS & BANKING (DIGITALISATION)

4.1 Innovation in Banks – Concept & Origin………………………….....…….45

4.2 E-banking……………………………………………………………...…..46

4.3 Debit card…………………………………………….………………….....47

4.4 Credit card………………………………………………………………....47

4.5 ATM…………………………………………………………………….....47

4.6 RTGS………………………………………………………………………48

4.7 NEFT………………………………………………………………………48

4.8 Net/online banking………………………………………………………...49

4.9 Mobile banking………………………………………………………….....50

4.10 Other new financial services……………………………………………....51

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5. DIGITALISATION IN HDFC BANK

5.1 Introduction...................................................................................................53

5.2 Technology………………………………………………………………....54

5.3 Recent innovations in Retail Business Banking………………………….....54

5.4 Innovation in Wholesale Business banking…………………………............56

5.5 Service quality initiatives…………………………………………………...57

5.6 Cyber-security……………………………………………………………...58

5.7 Awards & recognition……………………………………………………...58

6. RESEARCH METHODOLOGY

6.1 Introduction…………………………………......……………………….....59

6.2 Objectives of the Study…………………………………………..………....59

6.3 Research Design………………………………………………………........59

6.4 Research Type…………………………………………………………........60

6.5 Sample Design……………………………………………………………...60

6.6 Source of Data Collection……………………………………………..…....60

6.7 Data Collection tools………………………………………………..............61

6.8 Methods of Data Collection…………………………………………….......61

7. DATA ANALYSIS & INTERPRETATIONS.........................................................62

8. FINDINGS..................................................................................................................69

9. SWOT Analysis..........................................................................................................70

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10. SUGGESTIONS.......................................................................................................71

11. LEARNINGS...........................................................................................................72

12. CONCLUSION........................................................................................................73

13. LIMITATIONS OF THE STUDY..........................................................................74

14. APPENDICES..........................................................................................................75

15. BIBLIOGRAPHY....................................................................................................79

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COMPANY’S PROFILE

WE UNDERSTAND YOUR WORLD

The Housing Development Finance Corporation Limited (HDFC) was amongst the first
to receive an 'in principle' approval from the Reserve Bank of India (RBI) to set up a bank in
the private sector, as part of the RBI's liberalisation of the Indian Banking Industry in 1994.

The bank was incorporated in August 1994 in the name of 'HDFC Bank Limited', with its
registered office in Mumbai, India. HDFC Bank commenced operations as a Scheduled
Commercial Bank in January 1995.

HDFC Bank Limited is an Indian banking and financial services company headquartered in
Mumbai, Maharashtra. It has 84,325 employees and has a presence in Bahrain, Hong Kong
and Dubai. HDFC Bank is India’s largest private sector lender by assets. It is the top largest
bank in India by market capitalization as of August 2018. It was ranked 74th in 2017 Brand Z
Top 100 Most Valuable Global Brands.

On 14th March 1995, HDFC Bank went public with the launch of its IPO.

CEO: Aditya Puri

Founder: Hasmukhbhai Parekh

BUSINESS FOCUS

✓ HDFC Bank's mission is to be a World-Class Indian Bank.

✓ The objective is to build sound customer franchises across distinct businesses so as to

be the preferred provider of banking services for target retail and wholesale customer
segments,

✓ To achieve healthy growth in profitability, consistent with the bank's risk appetite.

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 ✓ The bank is committed to maintain the highest level of ethical standards, professional
integrity, corporate governance and regulatory compliance.

✓ HDFC Bank's business philosophy is based on four core values - Operational

Excellence, Customer Focus, Product Leadership, Sustainability and People.

MARKET LEADER IN E-COMMERECE

HDFC Bank provides a series of digital product offerings like- 10 second personal
loan/business loan, Chillr, Smart Hub (Complete Payment solutions), Watch Banking, 30-
Minute Auto Loan, 15-minute Two-Wheeler Loan, e-payment gateway, Pre-approved loans,
Digital Wallet (PayZapp) etc.

HDFC Bank provides a number of products and services which includes Whole sale banking,
Retail banking, Treasury, Auto Loans, CV, IFC, Channel Funding, Loans, Pl/BL, LAP, KCC
Commodities Funding and Credit Cards.

The latest entry in the league is 'Project AI' under which HDFC Bank, over the next few weeks,
would deploy robots at select bank branches. These robots will offer options such as cash
withdrawal or deposit, Forex, fixed deposits and Demat services displaying on the screen to
person coming into the branch.

Web view of HDFC Bank

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TECHNOLOGY

HDFC Bank operates in a highly automated environment in terms of information

technology and communication systems.

All the bank's branches have online connectivity, which enables the bank to offer
speedy funds transfer facilities to its customers.

Multi-branch access is also provided to retail customers through the branch network
and Automated Teller Machines (ATMs).

The Bank has made substantial efforts and investments in acquiring the best technology
available internationally, to build the infrastructure for a world class bank.

The Bank's business is supported by scalable and robust systems which ensure that
clients always get the finest services it offer.

The Bank has prioritized its engagement in technology and the internet as one of its key
goals and has already made significant progress in web-enabling its core businesses.

In each of its businesses, the Bank has succeeded in leveraging its market position,
expertise and technology to create a competitive advantage and build market share.

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 VISION, MISSION & PURPOSE:

Mission
To be a world class Indian Bank.

Purpose
To build sound customer franchises across distinct businesses so as to be the preferred provider
of banking services for target retail and wholesale customer segments, and to achieve healthy
growth in profitability, consistent with the bank’s risk appetite.

Vision

The bank is committed to maintain the highest level of ethical standards, professional integrity,
corporate governance and regulatory compliance. The bank’s philosophy is based on five core
values-

a. Operational Excellence
b. Customer focus
c. Product leadership
d. People
e. Sustainability

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BENEFITS - WHY CHOOSE US?
HDFC bank, got its name from Housing Development Financial Corporation. HDFC bank was
the first bank to start Home loans with a comparatively lower rate of interest and instalments.

The concept of digitalization in banking was adopted first and started by HDFC bank then
followed by the other banks, hence it has an upper hand in this field compared to others.

This bank offers several applications for customer usage on computers as well as mobile
phones with android or i-phone operating systems. It makes easier for the customers to operate
from any place at any point of time.

HDFC bank provides efficient customer engagement whenever customer visits any branch of
the bank.

The bank provides a secure and robust method of transactions taken place in the bank which
ensures customer retention.

LIMITATIONS
Though digitalization has changed the concept of banking and made it very easy and
convenient for customers for operations, there are still some people who are sceptical about
adopting this method.

• To some customers, use of digitalization is insecure.

• It involves high investment.
• Constant growth and improvisation of services offered is inevitable.
• The customer should have access to net banking otherwise it is inaccessible for the
customer to use any of the services offered online.
• Risk of security breach.
• If login credentials leaked, anyone can access the account.
• Senior citizens still prefer the traditional method of banking, which lowers the count
of the customers who use digital banking.

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 MARKETING MANAGEMENT IN BANKS

MARKETING MANAGEMENT

It is the organizational discipline which focuses on the practical application

of marketing orientation, techniques and methods inside enterprises and organizations and on
the management of a firm's marketing resources and activities.

BANK MARKETING
It is understood as a system of organization and management of a bank to achieve maximum
satisfaction of the needs of capital as well as other products and services of the bank for one
or more groups of targeted customers.

It is “A process, consisting of identifying the most profitable markets now and in future;
assessing the present and the future needs of the customers; setting business development goals
and making plans to meet them; and managing various services and promoting them to achieve
the plans – all in the context of a changing environment in the market”.

Marketing to banking is as important as it is for any business. But what form of marketing
works and doesn't work depends highly on the target audience- where they are, and how they
interact with the business. Do they buy products digitally or do they still prefer a personal
touch? With the advent of ATMs, personally going to banks for withdrawal of money came
down, saving operational costs.

Similarly banks now have identified digital marketing as one of the sources of getting more
customers, at a much lower cost. Around $20 billion will be spent on digital marketing in the
next 3 years says IDC.

Traditional banking method is changed to digital banking. It is the era of digitalisation and
social media also started existence in marketing. There are lot of changes happened in the
Banking sector.

Like other services, banking services are also intangible. Banking services are about the money
in different types and attributes like lending, depositing and transferring procedures. These
intangible services are shaped in contracts.

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MARKETING APPROACH IN BANKS

With the need for marketing in banks having evolved out of the changing environment and
constant interplay of various interdependent factors, the importance of a systematic approach
to marketing cannot be overstressed. The application of a marketing approach in banks will
therefore involve:

a. Identifying customers’ financial needs and wants;

b. Developing appropriate banking services to meet these needs;

c. Pricing for the services so developed;

d. Setting up suitable outsells / banks branches;

e. Advertising to promote the services to the existing as well as prospective customers.

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FEATURES OF BANK MARKETING

• Banking product cannot be seen or touched like manufactured products (intangibility)

• In marketing banking products, the product and the seller are inseparable; they together
define the banking product (inseparability)

• Banking products are products and delivered at the same time; they cannot be stored
and inspected before delivering’ (perishability)

• Standardization of banking product is difficult (variability)

PURPOSE OF BANK MARKETING: -

Identifying the most profitable element now & in future.

Assessing the present & future needs of customers.

Setting business development goals & making plans to meet them.

Awareness among Customers

Modern technology has made customers aware of the developments in the economic
environment, which includes the financial system. Financial needs of the customers
have grown multi fold into various forms like quick cash accessibility, money transfer, asset
security, increased return on surplus funds, financial advice, deferred payments etc.

With a wide network of branches, even in a dissimilar banking scenario, customers expect the
banks to offer a more and better service to match their demands and this has compelled banks
to take up marketing in right earnest.

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Quality as a Key Factor

With the opening up of the economy, fast change has been experienced in every activity, and
banking has been no exemption. Quality is the watch word in the competitive world, which is
market driven and banks have had to face up to this emerging scenario. In fact, it may not be
out of place to reiterate that quality will in future be the sole determinant of successful banking
ventures and marketing has to focus on this most crucial need of the hour.

Growing Competition

Increased completion is being faced by the Indian banking industry from within the system
with other agencies both, local and foreign, offering value added services.

Competition is no more confined to resource mobilization but also to lending and other areas
of banking activity. The foreign commercial bank with their superior technology, speed in
operations and imaginative positioning of their services has also provided the necessary
impetus to the Indian banks to innovate and complete in the market place.

Technological Advances

Technological innovation has resulted in financial product development especially in the

international and investment banking areas.

The western experience has demonstrated that technology has not only made execution of
work faster but has also resulted in greater availability of manpower for customer Contact

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MARKETING ROLE IN BANKS

Marketing participates in solving fundamental economic problems of the banking

business. A commercial bank is organized in order to trade currency on financial
markets. It performs many operations at home and abroad with basic trading functions.
At the same time, banks are key tools in the implementation and delivery of funds to
provide financial services to the economy ergo. Banks are seen as one of the most
important organizations in financial economies. However, like other kinds of business,
banks must also select and resolve basic economic problems of business activities with
the active support of marketing.

Marketing managers can provide better resolution determining types of products and
services that banks provide to the market’s needs through activities such as gathering
information, researching customers’ demands, learning products’ competitors,
researching products’ using of individuals and enterprise customers. This will help
banks’ managers to make decisions of which kind of products and services will be
launched in the market.

Marketing contributes greatly to improve the quality of products and services, create
prestigious image, and increase the competitiveness of banks. As marketing has many
different methods to incorporate in the course of providing products and services of
banks, such as facilities, engineering technology, staffs and customers. Especially,
marketing also takes advantage of each element through strategic technology
development.

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BANK MARKETING FUNCTIONS
Bank marketing has four following major functions which contribute significantly in banking
development.

i. Demand Function
The first function is making banking products and services adapted to market’s Demand
Marketing researches the market in order to determine demands, desires and trends of the
market as well as the change in customers’ desired needs. From that, they can design new
products and services which become more attractive and bring more utility to meet increasing
needs of diverse markets. And at the same time, they can also create a competitive position.

ii. Distribution Function

Distribution function of bank marketing covers the entire process of organizing banking
products and services to selected clients. Its contents include learning and selecting potential
customers, guiding and assisting customers in the selection and use of products/ services of
banks, organizing activities at customer service outlets, researching to develop new
distribution channels to meet customers’ demands

iii. Consumption Function

Products depend on many factors but the most important is the quality of products/ services
and reasonable prices. This requires banks to improve their regular staff. Making
services/products adapted to market's demand

iv. Support function

Supporting the functionality of creating favourable conditions to perform three functions is
also the crucial function of marketing in banking business. Activities supported include
advertisements, propagandas and client conferences.

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ESSENCE OF MARKETING IN BANKING BUSINESS

❖ CHARACTERISTICS OF PRODUCTS

The Bank is organized for currency trading which is a special commodity. Products of banks
are the services related to currency banks providing to customers. Therefore, Banks’s products
carry full natures of service and have the following main characteristics: -

1. Products and services of banks are invisible which are processes rather than specific
objects. On the other hand, they are directly related to money, money is the main
ingredient creating banking products. Generally, they are very sensitive to market
information and customer psychologies. A small change in interest rates will also
influence significantly on customer psychologies in the selection of banking products
and services.

2. The production and consumption occur simultaneously, for example with the direct
involvement of customers in the course of providing products and services.

3. Products and services of banks are also made in different spaces, forming the
heterogeneity of time, and implementation of conditional executions.

4. Products of banks are increasingly diversified; range of new products and services are
launched drastically. Banking products bring high socialization so any little negligence
in providing products (e.g. lack of cash payment, payment confusion, or faulty ATM)

❖ CHARACTERISTICS OF CLIENTS

Client component is extremely important in the existence and development of banks.

Customers have direct involvement not only in the process of providing banking products and
services but also in the use, enjoyment of products and services.

Therefore, customers’ demands, requirements of products/services will be a decision factor in

banking operations ‘success in terms of quantities, structures and qualities of

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products/services. Customers of banks are diverse, complex and contain many different
segmentation criteria. Besides customers, demand for banking services is not uniform and is
more volatile.

❖ CHARACTERISTICS OF COMPETITION

Competition in banking sector becomes drastic when the number of market participants
increases, and banking product portfolio expand continuously.

Competitive pressure acts as an impetus to create real growth banking products both current
and in the future. Trends among banks are expressed in the form of competitive marketing
activities, technologies, and on the scale (for consolidation, merger or linking together to
increase competitiveness).

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HDFC BANK -“MARKETING MANAGEMENT&ANALYSIS”

KEY BUSINESS AREA (BUSINESS PROFILE)

HDFC Bank caters to a wide range of banking services covering commercial and investment
banking on the wholesale side and transactional / branch banking on the retail side. The bank
has three key business segment:

Wholesale Banking

The HDFC Bank’s target market is primarily large, blue-chip manufacturing companies in the
Indian corporate sector and to a lesser extent, small & mid-sized corporates and Agri-based
businesses.

For these customers, the Bank provides a wide range of commercial and transactional banking
services, including working capital finance, trade services, transactional services, cash
management, etc.

The bank is also a leading provider of structured solutions, which combine cash management
services with vendor and distributor finance for facilitating superior supply chain management
for its corporate customers.

Based on its superior product delivery / service levels and strong customer orientation, the
Bank has made significant inroads into the banking consortia of a number of leading Indian
corporates including multinationals, companies from the domestic business houses and prime
public sector companies.

It is recognised as a leading provider of cash management and transactional banking solutions

to corporate customers, mutual funds, stock exchange members and banks.

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Wholesale banking is the provision of servicers by banks to the like of large corporate client,
mid-sized companies, real estate developers and investors international trade finance business,
institutional customers (such as pension funds and government entities and agencies) and
services offered to other banks or other financial institutions.

❖ In essence, wholesale banking services usually involve high value transactions.

❖ Wholesale banking contrast with retail banking, which is the provision of banking
services to individuals
❖ (wholesale finance means financial services which are conducted between financial
companies and institutions such as banks, fund manager and stock brokers)
❖ Modern wholesale bank is engaged in finance wholesaling underwriting market
making, consultancy, mergers and acquisition, fund management.

Retail Banking

The objective of the Retail Bank is to provide its target market customers a full range of
financial products and banking services, giving the customer a one-stop window for all his/her
banking requirements. The products are backed by world-class service and delivered to
customers through the growing branch network, as well as through alternative delivery
channels like ATMs, Phone Banking, Net Banking and Mobile Banking.

The HDFC Bank Preferred program for high net worth individuals, the HDFC Bank Plus and
the Investment Advisory Services programs have been designed keeping in mind needs of
customers who seek distinct financial solutions, information and advice on various investment
avenues.

27
The Bank also has a wide array of retail loan products including Auto Loans, Loans against
marketable securities, Personal Loans and Loans for Two-wheelers. It is also a leading
provider of Depository Participant (DP) services for retail customers, providing customers the
facility to hold their investments in electronic form.

HDFC Bank was the first bank in India to launch an International Debit Card in association
with VISA (VISA Electron) and issues the MasterCard Maestro debit card as well. The Bank
launched its credit card business in late 2001. By March 2018, the bank had a total card base
(debit and credit cards) of over 45 million. The Bank is also one of the leading players in the
“merchant acquiring” business with over 435,000 Point-of-sale (POS) terminals for debit /
credit cards acceptance at merchant establishments. The Bank is well positioned as a leader in
various net based B2C opportunities including a wide range of internet banking services for
Fixed Deposits, Loans, Bill Payments, etc.

The growth in HDFC Bank’s retail banking business was robust during the year ended March
31, 2018. It’s total Retail Deposits grew by 22.6 per cent to 788375.14 crores in the year ended
March 31, 2018, driven by 2.13 percent increase in the same to 805600 crores till June 30,
2018.

The growth in Retail Advances has been primarily due to two factors. First is the extensive
network of branches across the length and breadth of the country which allows the Bank to
reach out to different customer segments. Second is the emphasis on innovation across
multiple channels, which offers customers choice, convenience and a superior experience.

Faster and more efficient platform deliveries across ATMs, Internet, Phones and Mobiles have
been the cornerstone of the growth in Retail Advances. Focus on cutting edge analytics and
Customer Relationship Management (CRM) has helped the Bank to understand the customers’
life cycle better and offer them products appropriate to their profile and needs. Further,
analytics also allow the Bank to target potential customers in a cost-effective manner

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 Retail banking today is characterized by three areas:

Multiple product (deposits, credit card, insurance and investment)

Multiple channels of distribution (call centre, branch internet)
Multiple customer groups (consumer, small business)

Treasury

Within this business, the bank has three main product areas –

➢ Foreign Exchange and Derivatives

➢ Local Currency Money Market & Debt Securities
➢ Equities.

With the liberalisation of the financial markets in India, corporates need more sophisticated
risk management information, advice and product structures.

These and fine pricing on various treasury products are provided through the bank’s Treasury
team.

To comply with statutory reserve requirements, the bank is required to hold 25% of its deposits
in government securities.

29
The Treasury business is responsible for managing the returns and market risk on this
investment portfolio.

The Treasury Group is responsible for compliance with reserve requirements and management
of liquidity and interest rate risk on the Bank’s balance sheet.

On the foreign exchange and derivatives front, revenues were driven primarily by spreads on
customer transactions based on trade flows and customers demonstrated hedging needs.

Data: - The year ended March 31, 2018 recorded 1,523.5 crores in revenues from foreign
exchange and derivative transactions. These revenues were distributed across large and
emerging corporates, business banking and retail customer segments for plain vanilla foreign
exchange products and across primarily large and emerging corporate segments for
derivatives. The Bank offers Indian Rupee and foreign exchange derivative products to its

customers, who use them to hedge their market risks.

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MARKETING MIX: - (HDFC BANK)

The marketing mix has been defined as the "set of marketing tools that the firm uses to pursue
its marketing objectives in the target market". It is a combination of factors that can be
controlled by a company to influence consumers to purchase its products.

Thoughtful marketing, introduction of good financial products, aggressive expansion and most
importantly, excellent service is the reason that HDFC is amongst the top 2 banks of India.
(ICICI and HDFC are always at loggerheads)

This section discusses the marketing mix of HDFC. The marketing mix is very much
responsible for the growth of the company and this marketing mix has made it one of the most
coveted banks in India.

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 Product

HDFC offers mainly banking services, but there are many financial products which it offers
along with banking. HDFC ergo, HDFC life and HDFC home loans are some of the products.
In total, the financial product portfolio of HDFC is huge.

The USP of HDFC is that it designs competitive products which guarantees great response
from the market and an almost unlimited longevity for business life. In terms of a banking, its
product are its services, like net banking and ATM, and being a major bank, HDFC has
planned its products in proportion with the ever-increasing customer’s needs, demands and
expectations.

Apart from offering accounts, it has carried forward its namesake of being a housing finance
corporation, and offers large variety of loans for purchasing houses, construction, re-
construction, buying housing land, apartments etc. with maximum loan cover of up to 85%,
and maximum repayment period of up to 20 years which is a major propulsion factor for it as
a bank. Being into the services business, the major support for the product lies in its
distribution. Thus, after the product, the place and distribution of HDFC bank services is most
important for its success.

32
 Place

The bank has an amazing 4787 branches in 2691 cities across the world. It is headquartered in
Mumbai.

HDFC bank has 12,635 ATM’s across India.

Furthermore, the banks services are delivered not only through ATMs or branches, but also
through an excellent net banking service, phone banking, mobile banking and SMS banking.

HDFC ensures that it has a presence so that it can concentrate on its huge commercial clientele
along with being present for its retail clients. Banking is an intricate function as it includes
certain confidential and security invoking processes that are to be carried on a regular basis,
and they are done with minimal margin of errors, that cannot function in an unsafe
environment.

HDFC banks has got a strong presence all across India. Till 2018, HDFC outreached 4500+
branches in approx. 2500 cities/towns with 12000 ATMs.

HDFC Bank makes sure that its presence is felt in each and every corner of the nation and
every individual should avail its facilities equally. HDFC has its major offices in cities and
towns for smooth operation process. Its website is well designed and well maintained. It
facilitates ease of net banking, online payment options, etc.

All branches are linked on an online real-time basis. Customers in over 120 locations are also
serviced through Telephone Banking. The Bank's expansion plans consider the need to have a
presence in all major industrial and commercial centres where its corporate customers are
located as well as the need to build a strong retail customer base for both deposits and loan
products.

Being a clearing/settlement bank to various leading stock exchanges, the Bank has branches
in the centres where the NSE/BSE has a strong and active member base.

33
 Price

HDFC Bank follows a “Competitive Pricing Strategy” in its marketing mix but maintains a
premium level at the same time. It is clearly visible that it enjoys maximum market capital in
terms of shares in India.

The other domestic competitors are either PSUs or national bank, HDFC Bank is always priced
higher in terms of minimum cap required to open a new account. RBI controls and regulates
the pricing policies, like for any other bank in India.

HDFC is known to hold major market share in the banking sector of India, and this is because
of reasonable yet profit invoking price structure for its services, which is justified to an extent,
as every corporation has to sustain inflation and overcome market hurdles.

HDFC bank has premium competitive pricing. When compared with national and PSU bank,
the pricing is premium, because the minimum amount required to open an account is high. But
at the same time, there are many rules, like home load interest, which are as per RBI guidelines
and are competitive in nature. Thus, prices for these products are in control by the market and
not by the corporation.

It provides reasonable loans at maximum repayment tenure and at par interest rates to both old
and new customers. Apart from regular charges, it does not charge anything for miscellaneous
and associated functions such as cheque replacement, advance loan repayment, take over etc.
a lot. Thus, in some places HDFC is premium priced, whereas in others as competition.

34
 Promotion

From the very beginning, HDFC has planned and executed its promotional activities in a
manner that has suited its service catalogue and has maintained a 360-degree approach in
planning its commercials, campaigns and marketing activities in general.

These promotional activities include variety of subtle television commercials with a message,
a recent and innovative method of promotion by placing signboards and milestones in the rural
portions of country in local/native language and placing “No Parking” boards outside
residential and commercial buildings, that has promoted its connection with the masses and
making prospective client base associated with the name i.e. HDFC.

HDFC uses undifferentiated marketing techniques, it mainly focuses on introducing its

financial products to everyone. Because banking in general, is a mass market product.
However, for the HNI customers, well trained relationship managers, wealth managers are
used to retain the HNI clients with HDFC.

HDFC Bank focuses a lot on the promotional strategy in its marketing mix. HDFC is involved
in large number of CSR activities for sustainable livelihood, financial literacy, education,
training and community initiatives.

HDFC has always made its presence feel in the media through: -

❖ Advertisements
❖ Hoardings
❖ Sponsorships
❖ Ads in Newspapers
❖ Magazines & Journals
❖ Promotional Events
❖ Online(website)

35
 “BANK AAPKI MUTTHI MEIN – CAMPAIGN”

HDFC one of the key players in the India's banking industry, kick started an aggressive brand
campaign titled 'Har Zaroorat Poori Ho Chutki Mein, Bank Aapki Mutthi Mein' to
cement its position as a premier digital bank.

The three-month long campaign delves into the bank's products and offerings such as Instant
Accounts, One-Click payments, One-Click shopping, 10-second loans, Quick investments -
all of which are digitally accessible.

The objective and idea behind the campaign: -

HDFC Bank has been working on its digital strategy for a very long time. This campaign
clearly announces that the bank is now a full-service digital bank and offer all its products and
services via digital. It also points that people now have the bank on their phones and hence in
their hands.

Musical logo (MOGO) initiative

Interestingly, the bank has also recently released a musical logo (MOGO) that is being used
across multiple touch points such as ATM's, phone banking and app.

Prior to the advent of digital media, bank branches served as direct interface between the brand
and the consumer. But now in a digital age, needed something similar, which gave a
personalized feeling. Hence, bank decided to create a musical logo that offers connect and a

36
higher recall for the brand in a hi-tech environment. The logo is present across all the touch
points such as Mobile app, phone banking, web-login, ringing tone, caller tunes and ATM's.

They found that brain processes visuals before accepting them, however, sound works at a
conscious level. So, from a strategic point of view, when people will interact with the logo, it
will generate a recall for the brand at a conscious level among consumers. This will take the
brand to the next level.

This logo has all the elements such as being progressive, caring and Indian in nature.

However, it was an effort to differentiate HDFC Bank as a digital brand as no other bank brand
has such a jingle, which is present comprehensively.

Since this is a service marketing brand, here are the other three Ps to make it the 7Ps marketing
mix of HDFC Bank.

37
 People:

HDFC Bank gives strong importance on its people i.e. customers and employees. Through its
multi demographic culture it is clearly visible that HDFC believes in diversity and inclusion.
In India it has spread its offices geographically in every state, to spread awareness to the
maximum number of people. With the help of this advanced technology, HDFC bank
employees will be highly satisfied and they will always get competitive edge over others.

Physical Evidence:

HDFC provides best in-house facilities with up to date infrastructure and global environment
in all its offices. The complete setup helps the employees to experience the best work
environment so that they perform as per the organization’s expectations. HDFC offices,
branches, credit cards, website etc are all the physical evidence of the brand.

Process:

HDFC bank has several business processes like all other financial institutions. Through the
various social activities and best practices HDFC maintains a good relationship with its
customers and investors, which in turn avoids a bad ‘word of mouth’. All these helps the
organisation to grow in long term and motivates its employees to continue being loyal to it
and give their best throughout their tenure. The customers are also successfully retained and
new ones are attracted. Hence, this concludes the marketing mix of HDFC bank.

38
TAGLINE: “WE UNDERSTAND YOUR WORLD”
What’s behind the tagline:

The baseline of ‘We understand your world’ is an old one that HDFC Bank has been using for
the past couple of years.

The tagline says explain to the consumers how exactly HDFC Bank understands their world
and how exactly it fits into their lives.

The ‘We understand your world’ print campaigns emphasise the fact that the HDFC bank can
be accessed at the convenience of the banker.

MESSAGE CONVEYED THROUGH THE PRINTED AD: -

The print ad focussed on car loans and has the tag line – “Don’t have a car. Now you do.”

This one emphasises that the HDFC Bank that people need a loan without hassles and delays
and that they approve car loans, personal loans, etc. against most shares, investments, relief
bonds as well as insurance policies in almost no time.

LOGO – HDFC BANK

The full form of HDFC is "Housing Development Finance Corporation”. It was started with
the aim to provide better housing loans, investing into housing development sector. The HDFC
logo looks like a building-work-in-progress. Its red and blue blocks as bricks. In the logo, the
4-corner look like the boundary or compound walls of a house and the blue square, a house. It

may mean that the bank intends to help people build their homes and also that it cares.

39
STP – ANALYSIS – HDFC BANK

❖ SEGMENTATION STRATEGY
It defines on what basis the customers are segregated within the market place, so that target
market section can be easily assessed for providing the banking services effectively.

It is very crucial step to segment the customers so that better focus is maintained by the

organisation on the target market & fulfil their banking needs at better level.

1. DEMOGRAPHIC VARIABLES: -
A) LOCATION: - Metros & divisional cities

B) OCCUPATION: -

▪ Business persons
▪ Salaried class (both- Govt & private)
▪ Working women
▪ Students

C) AGE: -

I. Major
II. Minor
III. Senior citizen

40
2. PSYCHOGRAPHIC VARIABLE LIFESTYLES: -
People who believe in modern banking with services. People who want basic banking need
fulfilment.

3. SELECTIVE SPECIALISATION STRATEGY

Here the bank selected a number of segments, each objectively attractive & appropriate. For
example, of cards then Axis Bank have separate set of credit cards, each targeted at different
set of people i.e. segment & each one has its own importance for the bank.

❖ TARGET MARKET STRATEGY

The specific set of customers that are selected to get catered to the services (specific) of banks
so that their needs are fulfilled in a better & effective manner.

This process is shortlisting activity after segmenting (basis of factors) all the customers in the
market place. Setting the target customers is essence of providing quality services by the
organisation.

Following are the target market set of customers for Hdfc bank: -

Corporate banking market - This market targets the industries & fulfil their
financial needs & also provide exclusive services as per requirements.

Capital market- This section is targeted on the long-term needs of individuals and
as well as of industries, who form the major part of customers.

Retail banking market- This section is for the retail investor & provides them
short term financial credit for their personal and household needs.

41
❖ POSITIONING STRATEGY
HDFC bank has positioned itself as a bank which gives higher standard of services through
product innovation for diverse need of individual & corporate clients. The bank has
highlighted the following core-areas of its positioning statement: -

• Customer Centric

• Service Orientation

• Product Innovation

After the adoption of comprehensive digital strategy by Hdfc bank & on the path of
digitalisation, it has able to position itself as a premier Digital Bank in the minds of customers.

42
DIGITAL MARKETING – HDFC BANK

How HDFC's digital strategy work: -

HDFC’s digital strategy is based around comprehensiveness, convenience and quick turn-
around times. It is this strategy that makes it different from other banks.

HDFC Bank has a mobile app via for banking which allows funds transfer, bill payments,
ordering cheque books, statements and loans. Next, HDFC Bank launched PayZapp that
allows people to recharge phones, shop groceries, electronic items, movie tickets and other
things via a single click. HDFC Bank also launched Chillr App for funds transfer to friends,
family and merchants. It clearly reflects the convenience and comprehensiveness of its digital
strategy.

Second important aspect of HDFC Bank's digital strategy is speed. The bank provides loans
in 10 seconds to select customers. It is the fastest in the world. The turn-around times are
extremely low.

As all products are digital, hence the customers have also gone mobile. Today, all the
transactions can be done via net and mobile. It is a far more sustainable strategy and helps the
bank in re-aligning with the world that consumers are living in.

43
How does the bank reach out to its digital audience?
The marketing is focused on all channels such as net banking, mobile, emails, social media,
YouTube, and other areas. HDFC target consumers via owned and earned channels. Owned-
channels include Email, mobile app notifications, websites, net banking, ATM and others.

Bank has in-house analytical teams that plan campaign in a relevant and timely manner.
Moreover, they are regularly reaching out their customers via behavioural targeting. For
example, if a consumer is looking to travel, he will see my ad for making bookings via
Payzapp.

Overall marketing strategy for HDFC Bank now in recent time

The bank looks at the advertising and marketing strategy from two aspects - Brand Building
and ROI. On an on-going basis, it has a very high intensity localized ROI, which goes for day,
month-on-month and Y-O-Y. Every campaign falls under this ambit. It includes on-ground
activation that bank do for its branches across the country where they reach out and acquire
customers via direct marketing.

However, brand building is divided in to two elements. It is driven by the customer experience
and they have communication to help amplify it. Bank’s aim is to get the consumer experience
right, which earlier was done at the branch level. The similar experience is given at the digital
platform. So HDFC’s focus is always on the customer and his/her requirements.

Hdfc is reaching out to a wider audience and connect with the people using mass media. In
past, it has done campaigns around ATM network, faster service.

HDFC bank allocate 20% spends to mass media, 20 - 25 % to digital, 5 - 10 % owned channels
and rest to direct marketing. It is very practical with its media spends.

44
INNOVATION & BANKING (DIGITALIZATION)

The term “Innovation” means ‘to make something new’

Banks no longer restricted themselves to traditional banking activities but explored newer
avenues to increase business and capture new market.

Banking Innovations
Over the years, the banking sector in India has seen a number of changes. Most of the banks
have begun to take an innovative approach towards banking with the objective of creating
more value for customers. Information technology has given rise to new innovations in the
product designing and their delivery in the banking and finance industries. Technology offers
a chance for banks to build new systems that address a wide range of customer needs including
many that may not be imaginable today.

Financial innovation associated with technological change totally changed the banking
philosophy and that is further tuned by the competition in the banking industry. Challenging
business environment within the banking system create more innovation in the fields of
product, process and market.

45
 “Digitalisation in banking is the major innovation. “

E-Banking

E-Banking is a major innovation in Banking. E-Banking means provision of banking products

and services by banks directly to customers through electronic delivery channels.

Benefits of E-Banking
1. E-Banking gives a better brand image to banks.

2. There is more scope for offering differential services under e-banking.

3. The operational cost of banking would come down.

4. Customers can enjoy banking products at reduced cost.

5. Quicker, easier and continuous access to information is made available to the customers.

6. Facilitates pre-authorized direct withdrawals for marking bill payments.

7. It facilitates electronic fund transfer(EFT).

8. Online purchase of goods and services and online payment for the same provided by e-
banking is a boon to the customers.

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 Debit Card

Debit card is a plastic card which provides an alternative payment method to cash when
making purchases. Functionally, it can be called an electronic check, as the funds are
withdrawn directly from either the bank account or from the remaining balance on the card.

Credit Card

A credit card is part of a system of payments named after the small plastic card issued to users
of the system. It is a card entitling its holder to buy goods and services based on the holder's
promise to pay for these goods and services. The issuer of the card grants a line of credit to
the consumer (or the user) from which the user can borrow money for payment to a merchant
or as a cash advance to the user.

Automated Teller Machines (ATM)

ATMs are widely used electronic channels in banking. It is operated by plastic card with its
special features. It is a computer-controlled device at which the customers can make
withdrawals, check balance without involving any individuals.

47
ATM can be interior (i.e., located in the branch premises) or exterior (located anywhere outside
the branch premises).

The banks increased their penetration further with the total number of ATMs reaching 0.22
million in 2018. However, there was a decline in growth of ATMs of both Public Sector Banks
as well as Private Banks. Public Sector Banks recorded a growth of 16.7 per cent during 2017-
18 maintaining a share of around 70 per cent in total number of ATMs.

RTGS Real Time Gross Settlement (RTGS)

✓ It stands for ‘Real time gross settlement system

✓ It is a fund transfer mechanism where transfer of money takes place from one bank to
another on a ‘real time’ and on ‘gross basis’.
✓ This is the fastest possible money transfer system through the banking channel.
✓ It is different from EFT and NEFT
✓ It is primarily for large volume transaction
✓ The time taken for effecting funds transfer from one account to another is normally 2
hours
✓
NEFT National Electronic Funds Transfer (NEFT)
It is an Indian system of electronic transfer of money from one bank or bank branch to another.
Under NEFT, individuals, firms and corporates can electronically transfer funds from any
bank branch to any individual, firm or corporate having an account with any other bank
branch in the country participating in the Scheme.

The funds under NEFT can be transferred by individuals, firms or corporates maintaining
accounts with a bank branch.

Even individuals not having a bank account can deposit cash at the NEFT-enabled branches
with instructions to transfer funds using NEFT.

However, such cash remittances will be restricted to a maximum of Rs.50, 000/- per
transaction. Such walk-in-customers have to furnish full details including complete address,
telephone number, etc. NEFT.

48
 Internet Banking (online/net banking)

It is a service provided by banks so that people can find out information about their bank
account, pay bills etc. using the Internet. Internet Banking allows you to conduct bank
transactions online, instead of finding a bank and interacting with a teller. In a broad sense, it
is the use of electronic means to transfer funds directly from one account to another, rather
than by cheque or cash.

With the advent of the internet, everything has transformed into its electronic version. Banking
is not far behind. Now when people have access to all kinds of gadgets like laptops, phones,
tablets - banking is just one click away from making financial transactions!

The biggest advantage of internet banking is the convenience. It is much better than physically
going to the bank in many ways:

You can make a transaction from anywhere - you need not actually go to a bank counter - you
have access from home, work or even when you are on a holiday

You can make a transaction at any time - you need not abide by the working hours of the bank.
You need not even worry about Sundays or other holidays - your account is accessible 24x7.

You can use any device with internet access for your bank activities - phones, laptops, desktops
& tablets - anything.

Banks offer a wide range of services - payment of bills, transfer of money, checking account
transactions via the internet.

All the transactions are automatically updated immediately; therefore, you always have access
to your information without submitting any slips or documents. Thus, your account is always
up-to-date without any discrepancies since the process is completely automated.

49
The best part about internet banking is that one can keep track of all your different accounts
simultaneously. In case one has multiple accounts, he need not go to different branches of your
bank. This saves a lot of time

MOBILE BANKING

Mobile banking refers to the use of a smartphone or other cellular device to perform
online banking tasks while away from your home computer, such as monitoring account
balances, transferring funds between accounts, bill payment and locating an ATM.

It uses software, usually called an app, provided by the financial institution for the purpose.
Mobile banking is usually available on a 24-hour basis. Some financial institutions have
restrictions on which accounts may be accessed through mobile banking, as well as a limit on
the amount that can be transacted.

From the bank's point of view, mobile banking reduces the cost of handling transactions by
reducing the need for customers to visit a bank branch for non-cash withdrawal and deposit
transactions. Mobile banking does not handle transactions involving cash, and a customer
needs to visit an ATM or bank branch for cash withdrawals or deposits.

Advantage of Mobile Banking

1. Mobile Banking uses the network of service provider and it doesn't need internet developing
countries like India where there is no internet connection in the interiors there is the presence
of mobile connectivity.

2. Mobile Banking is available round the clock 24/7/365 and is easy and Continent mode for
many Mobile users in the rural areas.

3. Mobile Banking is said to be more secured and risk free than online/internet Banking.

4. With the help of Mobile Banking you can pay your bills, transfer funds, check account
balance, review your recent transaction, block your ATM card etc.

50
5. Mobile Banking is cost effective and Banks offer this service at very low cost to the
customers.

Other financial services: -

1. TOTAL BRANCH AUTOMATION

✓ Speed up bank transactions and less error

✓ More customer friendly and flexible

✓ Towards paperless transactions

2. ANY BRANCH BANKING

It is a facility for customers to operate their account from any of the same banks network
branch

Facilities available:

✓ Cash withdrawal & Cash deposits

51
 ✓ Account statement

✓ Facility to issue multi- city cheques

4. DEMAT SERVICES
✓ It offers secure and convenient way to keep track your securities and investment over
a period without the hassle of handling physical documents

✓ It provides facility of online trading

5. MICROFINANCE

It refers to a movement that envisions a world in which low income households have
permanent access to a range of fin services & credit

52
DIGITALISATION IN HDFC BANK

Innovation is now embedded in the DNA of HDFC Bank.

Employees are encouraged across functions to continuously come up with new ideas and
act as digital evangelists.
Innovation in the Bank has been driven by digitalization, the building block for which was
laid two decades ago by investing in technology.
Digitization has been a theme for the Bank in the last two years and it gained substantial
momentum in the year under review.
The Bank has a Digital Innovation team, perhaps the only such group in the Indian banking
context, to scout for and experiment with technology both contemporary and even
futuristic.

❖ Bank hosted a Digital Innovation Summit in March 2016 to tap into emerging
technological trends that are shaping the financial technology space. Five companies have
been chosen as potential partners in its journey. These companies have been drawn from
the domains of Artificial Intelligence, Marketing, Mobile Payments, Quality Assurance
and Biometric Payments.

53
TECHNOLOGY

HDFC Bank operates in a highly automated environment in terms of information

technology and communication systems.
All the bank's branches have online connectivity, which enables the bank to offer
speedy funds transfer facilities to its customers. Multi-branch access is also provided to
retail customers through the branch network and Automated Teller Machines (ATMs).
The Bank has made substantial efforts and investments in acquiring the best technology
available internationally, to build the infrastructure for a world class bank.

Some of the major digital innovations introduced this year are:

INNOVATIONS IN RETAIL BUSINESS

1. PayZapp with Smart Buy: A comprehensive, convenient and secure payment

solution which allows customers to link their cards once and then pay through one
click. Smart Buy within PayZapp brings the best deals and discounts offered by
merchant partners exclusively for HDFC Bank customers. PayZapp offers the unique
combination of the convenience of 1-click payments and security. PayZapp for
business allows merchants to bill their customers and receive payments instantly over
the mobile, thereby making it easier for them to collect cash remotely and expand their
business.

54
1) 10 second Personal Loan: A pre-approved instant loan on Net Banking which is
offered to select customers and is disbursed within 10 seconds of applying.

2) Zip Drive: An instant auto loan approval, which allows customers to generate an
online approval with reference number, walk into a dealership and drive out with the
car of their choice. This approval, valid for 30 days, enables the dealer to request HDFC
Bank for the already pre-approved loan sanctioned to the customer.

3) Virtual Relationship Manager: Offered to High Net Worth customers by

invitation, this is a 24*7 access to a relationship manager through a safe and secure
video interface on the mobile banking app.

4) Chillr: The Bank’s partner app, which allows customers to send and receive money
using phone book contacts. The app also allows customers to recharge mobiles, DTH,
data cards and make merchant payments.

5) Design Your Own Loan Against Securities (LAS): This combines the power of
a loan and a bank account. LAS can be availed against securities ranging from equity
to mutual funds to Kisan Vikas Patra. What’s more, customers can design the loan on
the basis of these securities.

55
 6) Loans on ATMs: HDFC Bank offers 10 second personal loans on ATMs. Various
consumer loans and top-up of existing loans to customers through ATMs will also be
made available in the future.

7) Missed Called Recharge: A simple and innovative way of recharging pre-paid

mobile phones. It requires one-time activation of
the service. The mobile number gets recharged for
the selected amount, every time the customer gives
a missed call to a particular number.

8) Watch Banking: Bank has launched a new app for the Apple Watch. With the new
app, HDFC Bank becomes the first bank in the country to foray into watch banking.
With the launch of wearable devices and potential demand for wearable devices in
India, consumers are highly likely to add yet another digital interface
– a wearable device – to their current portfolio of devices. A banking
experience on a personalized wearable device would take the
consumer’s interaction with the bank to a whole new level.

HDFC Bank is starting with the Apple Watch and aims to provide
banking services through all wearable devices across platforms like
iOS and Android Wear.

Innovations in Wholesale Business

❖ Trade on Net and E Net on Mobile for corporate customers:
For cash management, trade finance, treasury and supply chain services, dynamic digital
platforms like ‘Enet’ and ‘Trade on Net’ offer value additions at every stage of the financial
value chain. With Trade Finance Mobile, the services are now accessible anytime, anywhere,
allowing customers to authorize transactions on-the-go with OTP based security.

56
SERVICE QUALITY INITIATIVES: -
A regular process of reviewing the service levels and capturing feedback from
customers is undertaken for continuous improvement in product, processes and
service levels.
This has gained even more criticality as the customer can now access the Bank’s
services across traditional touch points like branches, ATMs as well as the digital
ones like the Internet and Mobile.
Thanks to the new digital products on offer from the Bank - constantly monitoring
the customer experience, securing feedback and acting on it becomes even more
imperative.
The Bank has therefore augmented the training and skill development mechanism
to empower and equip employees to deliver improved quality of Customer Service,
as well as put in place a more stringent grievance monitoring and redressal
mechanism across different delivery channels
. The effectiveness of these measures is reviewed periodically at different levels
including the Board of Directors. All these initiatives have helped in consistent
reduction in total number of customer complaints. It is also a testimony to the
Bank’s strong and objective review mechanism.

57
Cyber Security

HDFC Bank has setup an effective governance framework to manage cyber security.
A suitable organizational structure has been put in place to ensure that Bank monitors
various cyber security threats and minimizes them.
Bank conducts the cyber security threat assessment and mitigation requirements on a
continuous basis and is committed to implement necessary improvements in an on-
going manner.
The Bank has implemented various security initiatives.

AWARDS & RECOGNITION – HDFC BANK

58
RESEARCH METHODOLOGY

Research methodology is the process to collect the information and data for the purpose of
making business decisions. The methodology may include publication interviews, research,
surveys and other research techniques.

The method of training was on the job training and I was given the field work. I acted as an
employee and the basic method opted by me was to solve all problems related to Digital
Banking and aware them about the Digitalization.

I also interviewed people belonging to different age groups (youth, married with small
children, married with grown up children and old ones) and also the house wives.

The questionnaire was filled by 100 people where group of different people i.e. age, type of
account, No. of transactions were considered.

Research was carried out at HDFC Bank ltd. to find out the Impact of Digitalization.

Objective of the study

To identify the awareness and usage of Digital-Banking.
To study the impact of digitalization.
To know ow much banking services has been improved.
To study the satisfaction level of respondents.

Research design
Research design serves as a bridge between what has been established(the research
objectives)and how to accomplish these objectives. In fact, the research design is the
conceptual structure within which research is conducted; it constitutes the blueprint for the
collection, measurement and analysis of data. More explicitly, the design decisions happen to
be in respect of:

i. What is the study about?

59
 ii. Why is the study being made?
iii. Where will the study be carried out?
iv. What type of data is required?
v. Where can be the required data found?
vi. What period of time will the study include?
vii. What will be the sample design?
viii. What techniques of data collection will be used?
ix. How will the data be analyzed?
x. In what style will the report be prepared?

The function of research design is to provide for the collection of relevant evidence with
minimal expenditure of effort, time and money. But how all these can be achieved depends
mainly on the research purpose.

Research type

In this report I have used Descriptive research techniques. Descriptive research includes
surveys and facts -Findings enquiries of different kinds. The main purpose of descriptive
research is description of the state of affairs as it exists at present. The main characteristic of
this method is that the researcher has no control over the variables.

Sampling Design:

For my survey I have used Convenience sampling techniques.

Convenience sampling is a non-profitability sampling technique where subjects are selected

because of their convenient accessibility and proximity to the researcher.

SAMPLE SIZE- Sample of 100 people was taken in order to conduct the research.

UNIVERSE- In accordance to the specified research universe is Kota city; HDFC Bank(Main
Branch).

Sources of Data Collection:

PRIMARY DATA is the data which has been collected through personal contact.

60
 ✓ Through Questionnaire - questionnaire is a written set of questions, the answers to
which are recorded by the respondents.
✓ Through Personal Interactions – In personal Interaction an interviewer as questions
in a face to face contact to another person.

SECONDARY DATA is the data which are available in the form of facts and figures. The
sources of secondary data are:

❖ Websites
❖ Magazines
❖ Articles

Data Collection Tools:

For my survey I have used Pie Charts and Graphs.

Methods of Data Collection;

For my survey I have collected data through Questionnaire.

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 DATA ANALYSIS AND INTERPRETATIONS

Q1. What type of account you have in HDFC bank?

Type of Account
Other Account
Salary Account
2%
5%

Current Account
28%

Savings Account
65%

Savings Account Current Account Salary Account Other Account

Interpretations:

Out of 100 respondents that I have taken for my survey 65% respondents have savings account,
28% have current account, 5% have salary account and 2% respondents have other account
which include NRI and fixed-deposit account in bank. It means that the bank has a very good
amount of savings account customers as compare to other account.

Q2. Since how long you are having account in HDFC Bank?

Years

16%
37% 0-1 years
19% 1-2 years
2-3 years
28%
3 years & above

Interpretations:

Out of 100 respondents 33% have their account in HDFC Bank from the last 3 years and more.

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Q3. According to you what is more convenient way for banking?

Branch Banking Digital Banking

20%

80%

Interpretations;

When the customers are asked about their preference between branch banking and digital
banking 80% customers preferred digital banking and 20% customers preferred branch
banking as a mode of their banking transaction. Above graph reveals their preference for the
both.

Q4. Do you use Digital banking Services of HDFC Bank?

5%

Yes
no

95%

Interpretations:

Out of the 100 respondents 95% of them use digital banking and 5% does not prefer Digital
Banking Services.

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Q5. What are the reasons for choosing our Digital banking Services?

100%

80%

60%

40% 80%
60% 68%
20%

0% 0%
Convenience To save time 24 Hours access Security Reasons

Interpretations:

Out of 100 respondents 60% uses digital banking for convenience ,80% uses to save time and
68% use due to 24 hours access.

Q6. Which Digital banking services do you use at HDFC Bank?

Services

100%
80%
60% 100%
40% 75%
60%
20% 24%
0%
Internet Banking Mobile Banking Insta alert/SMS ATM
Query

Interpretations:

Out of 100 respondents 75% of them use Internet Banking ,60%out of 100 use Mobile banking,
24% of 100 use Insta alert/SMS Query, and all the 100% of respondents use ATM service

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Q7. For what purpose do you use Digital Banking services at HDFC Bank?

100%

80%

60%
90%
40% 78%
45% 36%
20%
0%
0%
Money Bill Paying Balance Detail Recharge Loan Related
Transfer Query

Interpretations:

Out of 100 respondents 90% use digital banking services for Money Transfer, 45% use for
Bill Pay, 78% use to get balance details, and 36% use for Recharge.

Q8. Are you aware about HDFC BANK digital initiative i.e. Go Digital?

Yes
No
45%
55%

Yes No

Interpretations:

As shown in above pie Chart 45% of respondents out of 100 are aware about HDFC bank Go
Digital Initiative while 55% of them are not aware.

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Q9. Which digital initiative you know about HDFC Bank?

Initiatives

100.00%
80.00%
60.00%
88.88% 78.33%
40.00%
44.44%
20.00% 28.88%
0.00%
PayZaap Chillr Digital Wallet Watch Banking

Initiatives

Out of 100 respondents that I have taken for my survey approximately 55% customers do not
know about Go Digital Initiative because they are not much aware about this facility. 45% of
them are aware about some initiatives and out of those 45% customers 88.88% knows about
PayZaap, 78.33% Know about Chillr,28.88% Know about Digital Wallet.

Q10. Do you use HDFC Bank Go Digital Banking Services?

40%

60%

Yes No

Interpretations:

Out of 100 respondents 40% of them use HDFC Bank Go Digital Banking Services and 60%
do not use it.

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Q11. Do you think HDFC Bank Banking services has improved through Digitalization?

5%

Yes
No

95%

Interpretations:

Out of 100 respondents 95% think that digitalization improved the banking services of HDFC
Bank and 5% of the respondents do not think that digitalization has improved the Banking
services.

Q12. Please rate how much Digitalization improved the banking Services?

2 Stars 1 Stars
0% 0%
3 Stars 5 Stars
18% 14%

4 Stars
68%

5 Stars 4 Stars 3 Stars 2 Stars 1 Stars

Interpretations:

Out of 100 respondents 14% of them rate 5 stars to the digital improvement in the banking
services,68% rate 4 stars, and 18% rate 3 stars.

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Q13. What is your level of satisfaction with HDFC bank Digital Services?

Fully Satisfied Satisfied Somewhat Satisfied Not Satisfied

2% 0%

33%

65%

Interpretations:

Satisfaction level is more important for the direct banking channel of bank. In the above graph
we can see that 65% are satisfied with HDFC Bank Digital Services, 33% Customers are fully
Satisfied and only 2% are somewhat satisfied. It indicates that HDFC bank customers have
high satisfaction level from the services they get.

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 FINDINGS
In our study we find that 100% respondents are aware with the ATM Facility and around 75%
of them use Internet Banking, 60%use mobile banking but the awareness of Insta alerts is
only 24%.

Most of Customers believe that Digital Banking is more convenient way for Banking and most
of use Digital Banking in order to save time and also as it has 24 hours access.

Customers uses digital banking services at HDFC bank for money transfer ,to pay bill, for
recharge, online shopping. HDFC provides very quick Services to its Customers.

Most of the respondents who are not using Go Digital Initiatives of the bank, it is because they
are not much aware about the initiatives of the bank.

The customers are using the digital banking services for few purpose it means the use of digital
banking channel is limited for few transactions.

Most of respondent who are using the digital banking services are satisfied with the services
of the bank for the particular digital banking Service.

This responses of respondents indicates that digitalization has a good and positive impact on
the banking services.

According to the response of the respondents it shows that digitalization improved the banking
services very much for the customers.

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SWOT ANALYSIS OF HDFC BANK

SWOT is an acronym for strengths, weaknesses, opportunities, and threats and is a structured
planning method that evaluates a project or business venture.

A SWOT analysis can be carried out for a company, product, place, industry, or person. It
involves specifying the objective of the business venture or project and identifying the internal
and external factors that are favourable and unfavourable to achieve that objective.

Let us analyse these 4 aspects for HDFC Bank:

STRENGTHS:

✓ First bank to implement digitalization process in banking sector. This is a major

achievement for this bank since being the first in starting something is the biggest
strength for the same.
✓ Highest customer retention rate compared to the other banks.
✓ Transparency in transactions which allows customers to know where the money is
going to be invested at what rate.
✓ Robust technology with a comparatively lower fraud rates.
✓ More number of branches which adds to customers’ convenience while visiting the
branch for transactions.
✓ First to introduce home loans in the banking sector.

WEAKNESS:

✓ Some customers still preferring the traditional methods of banking leading to a setback
in the succession of digital banking initiative.
✓ Terms and conditions too strict for applying for any loan due to security reasons.
✓ Rate of interest offered for fixed deposits are less compared to few other banks.
✓ Risk of security breach if login credentials breached.

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OPPORTUNITIES:

✓ Since digital banking provides convenience to the customers for banking, there is a
wider scope for the future customers to adopt more methods of digital banking and
make most use of it.
✓ Since HDFC is a privatized bank, the bank has a higher number of high network clients,
who do not have time to visit the branch for the operation purpose, this will be a push
for the adoption of digital banking in the high network world.
✓ Scope of implementing new ideas which will contribute towards digital banking which
will increase customers’ convenience and satisfaction increasing the customer
retention.

THREATS:

✓ The basic threat which a company faces is the threat of new entrants, or the competition
adopting new strategies.
✓ Even HDFC bank faces a threat of new banks being introduced into the market which
provide higher rate of interest on fixed deposits and lesser rate of interest on loans.
✓ Banks like Axis, Bank of India which are nationalized banks, have started adopting the
digital banking measures and are constantly improving their performance hence
retaining the customers.
✓ Introducing new and attractive products and services which are offered by other banks
can also pose a potential threat to the bank.

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SUGGESTIONS:

Even though the bank is progressing and implementing new methods towards the adoption of
digital banking, there were a few suggestions which were proposed.

Just like the way there is an automated passbook update machine, an automatic fixed deposit
receipt issue machine can be kept as well.

Where the customer will insert their existing receipts and then enter the time for which they
want to renew it. Accordingly, a new fee receipt will be generated and the existing one will be
destroyed immediately.

For cheque deposit, a machine can be kept where the cheque can be directly deposited.

An automatic demand draft machine can be kept, where the customer can just feed its account
number, amount and name in favour of demand draft, the draft will be automatically printed
and can be used.

Bank can introduce a cheque book request machine wherein customers who are not able to
punch their cheque books by methods introduced by bank can pinch it.

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LEARNINGS

❖ Understood the workflow of the bank.

❖ Got an insight into the digital banking.
❖ Got to learn different kind of banking forms and its usage.
❖ Corporate exposure.
❖ The satisfaction level of customers
❖ Got an insight Different Services of Digital Banking.
❖ Understood that Digital Banking Saves Time & efforts.

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CONCLUSION:

The project speaks about the study of all departments which are present in the specific branch
of the bank. Learn the processes that take place in each departments.

During the first half of the internship, the project undergoes the study of all the departments
individually by working under every department dealing with real time customers.

The final aim of the project is to study how the adoption of digitalization has affected the
financial status of the bank. It is also crucial to know the profits and the losses the bank
undergoes while adopting this methods.

During this first half of the project, while studying about the departments, it was also studied
how digitalization was adopted in each department and how it has benefited both, the
customers and the bank officials.

A survey was made to study how digitalization has helped branch. Customers not using the
digital banking were also convinced to start using the same.

HDFC bank was the first bank in the banking sector to adopt digitalization and has won an
award for the same.

Through digital banking, banking is now available to the customers on the tip of their fingers,
by providing the facility of banking over mobile phones. Even with a basic phone without
internet access, a customer can bank using SMS and Missed Call Banking. Through mobility,
the bank is delivering a greater flexibility to the customers.

Hence, now the mobile platform today accounts for the largest share that is 40% of total value
transacted over mobile phones in the country.

The bank’s website acts as a 24x7 virtual branch. Powered with Search, Select and Buy
features, the site receives 13 million unique visitors a month, making it one of the most visited
financial

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LIMITATIONS OF THE WORK:

❖ Due to security reasons and the banking policies, some of the sensitive data was not
able to be extracted.
❖ Because of Bank Policies I have to submit my original Research i.e. original
Questionnaire.
❖ Backend data was inaccessible for the project work due to bank’s terms and conditions.
❖ This study is limited only to the customer of HDFC bank, Kota(Main Branch) only.
❖ The responses of the customer may be biased
❖ Sample Size is Limited to 100.

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 APPENDICES

Questionnaire

NAME……………………………………
GENDER………………………………...
AGE………………………………………
OCCUPATION………………………….
EMAIL ID……………………………….

Q1. What Type of Account do you have in HDFC bank?

Savings Account Current Account

Salary Account Others (please Specify)_ _ _ _

Q2. Since how long you are having account in HDFC bank?

0 - 1 years 1 - 2 years

2 - 3 years 3 years & above

Q3. According to you what is more Convenient way of Banking?

Branch Banking Digital Banking

Q4. Do you use Digital Banking services of HDFC Bank?

Yes NO

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Q5. What are your reasons for choosing our Digital bank Services?

Convenience To save time

24 hours access Security Reasons

Q6. Which Digital Banking Service do you use at HDFC bank?

Internet Banking Mobile Banking

Insta Alerts/SMS Query ATM

Q7. For what purpose you use Digital Banking Service at HDFC bank?

Money transfer Bill Pay

Balance details Recharge

Loan Related Query other(please specify) _ _ _ _ _

Q8. Are you aware about HDFC bank Digital initiatives i.e. Go Digital?
Yes NO

Q9. Which Digital Initiative of HDFC you know about?

PayZaap Chillr

Digital Wallet Watch banking

Q10. Do you use HDFC bank Go Digital services?

Yes NO

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Q11. Do you think HDFC bank Banking services has improved through
Digitalization?
Yes NO

Q12. Please rate how much Digitalization has improved the Banking
Services?

5 stars 4 stars

3 stars 2 stars

1 star

Q13. What is level of satisfaction with HDFC Bank digital service?

Fully satisfied Satisfied

Somewhat Satisfied Not satisfied

Q14.Any Suggestions or recommendations to HDFC Bank?

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BIBLIOGRAPHY:

http://www.hdfcbank.com/htdocs/aboutus/News_Room/pdf/press_release_fina
ncial_results_ mar17.pdf
http://www.sharekhan.com/Upload/NewsLetter/Specialreport.pdf
http://www.hdfcbank.com/aboutus/cg/annual_reports.htm
http://www.marketing91.com/swot-analysis-hdfc/
https://www.hdfcbank.com/aboutus/News_Room/hdfc_profile.htm

BOOKS:

Kotler Philip, marketing management, (Pearson education, 12th edition)

Malhotra K. Naresh, marketing research (An applied orientation), Research design.

HDFC BANK annual report 2017-18.

Banking practices & strategies – author Anand Sharma.

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