A Study on Service Quality and Customer Satisfaction on HDFC Bank in Coimbatore City

Abstract

Today’s finicky banking customers will settle for nothing less. The customer has come to realize somewhat belatedly that he is the king. The customers choice of one entity over another as his principal bank is determined by considerations of service quality rather than any other factor. He wants competitive loan rates but at the same time also wants his loan or credit card application processed in double quick time. So, does HDFC bank meet these heightened expectations? What are the customers? perceptions of service quality of the banks? Which dimension of service quality of HDFC bank is performing well?

Introduction

• Service quality is a key strategy for attracting and retaining customers, especially in highly competitive industries like banking (Wang, 2003; Newman, 2001).

• Defined as the gap between customer expectations and perceptions, service quality impacts customer satisfaction, retention, profitability, and cost reduction.

• Differentiation through high service quality is essential, involving elements like technology, customer-oriented culture, and efficient service systems (Lewis, 1989).

2. Scope of the Study

• Focuses on HDFC Bank in Coimbatore city, analyzing:

  • Customer satisfaction

  • Service quality gaps using the SERVQUAL model (RATER: Reliability, Assurance, Tangibles, Empathy, Responsiveness)

  • Dimensions needing improvement

  • Recommendations for enhanced service quality

3. Objectives of the Study

• Measure and analyze service quality and customer satisfaction.

• Identify gaps between expected and perceived service.

• Assess performance of each SERVQUAL dimension.

• Recommend improvements for HDFC Bank.

4. Research Methodology

• Data Collection: Primary data

• Statistical Tools Used:

  • Simple percentage analysis

  • Weighted average method

  • Chi-square test

  • One-way ANOVA

  • Rank analysis

5. Limitations

• Results are specific to Coimbatore city and not generalizable.

• Based solely on primary data, which may have biases.

• Sample size constraints may introduce minor inaccuracies.

6. Review of Literature

• Studies by Muruganantham (2021) and Yadav & Jang (2021) evaluated HDFC Bank’s financial performance using ratio and CAMEL analysis.

• Findings suggest overall good performance, especially post-merger, though some issues in managing deposits remain.

7. Data Analysis & Interpretation

a. Simple Percentage Analysis

• Majority of respondents (62.9%) are under 30 years, followed by 33.7% aged 31–40.

b. Chi-Square Test

• Examined relationship between gender and compensation preference.

• Result: No significant association (p = 0.059 > 0.05); null hypothesis accepted.

c. ANOVA Test

• Analyzed occupational level vs. compensation provided.

• Result: No significant difference found (p = 0.169 > 0.05); null hypothesis accepted.

d. Rank Analysis

• Used to evaluate and compare responses across dimensions, minimizing outlier influence.

Conclusion

The analysis of customer interactions, service preferences, and satisfaction levels at HDFC Bank highlights key areas for improvement. While Savings Accounts, Loans, and Credit Cards remain the most widely used and appreciated services, there is scope to enhance customer engagement with Investments and Insurance. Customers highly value prompt, courteous, knowledgeable, and empathetic staff, indicating the need for ongoing training and service efficiency improvements. The growing reliance on digital banking services suggests that enhancing mobile and online banking features, along with faster complaint resolution, can significantly improve customer satisfaction. Additionally, maintaining clean and well-managed branches, offering a balanced employee compensation structure, and providing quick and effective issue resolution mechanisms will further strengthen customer trust and loyalty. By addressing these factors, HDFC Bank can continue to enhance service quality, customer satisfaction, and overall banking experience, ensuring long-term success and stronger customer relationships. The majority of customers have a long-term relationship with HDFC Bank but may not interact frequently with the staff. Proactive customer engagement strategies, such as personalized financial advice and periodic follow-ups, can help strengthen these relationships.

References

[1] https://www.researchgate.net/service_quality_banking [2] https://www.sciencedirect.com/customer_satisfaction_banks [3] https://www.springer.com/banking_service_quality [4] https://www.emerald.com/consumer_behavior_banking [5] https://www.ibef.org/indian_banking_industry JOURNALS [1] Journal of Banking and Financial Services - Author: Mehta [2] International Journal of Service Industry Management - Author: Rajan [3] Journal of Consumer Research in Financial Services - Author: Nair [4] Journal of Marketing and Customer Satisfaction - Author: Srinivasan [5] Indian Journal of Banking and Economic Research - Author: Kapoor

Copyright

Copyright © 2025 Dr. M. R. Chandrasekhar, S. Sruthi. This is an open access article distributed under the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.