Service Quality and Performance of Banks A comparative study of Public and Private Sector Banks

Abstract

Banking is an integral part of modern-day life. In the present scenario of competitive newlinebanking, excellence in customer service is the most important tool for sustained business newlinegrowth. Customer service has been the challenging job in the banking industry, specifically, after the financial sector reforms and implementation of new age technology. Providing prompt and efficient service is on the top agenda of commercial banks to attract and retain customers. newlineThe present study aimed to analyse the performance of public and private sector banks, newlineto study the perception of bank customers regarding service quality of public and private sector banks and to examine the relationship between service quality and bank performance. The study was based on four major banks, two from public sector; SBI and PNB and two from private sector; HDFC and ICICI banks. These banks were selected on the basis of their size, number of branches, customers etc. In order to attain the objectives of the study, both primary as well as secondary data was used. For measuring the performance of banks, the parameters like profitability, NPA to Net Advances and Business per employee were taken. Secondary data in the form of annual reports of selected banks for ten years were taken from the year 2009-10 to 2019-20. For service quality, a well-structured SERVQUAL type questionnaire given by Parasuraman has been prepared during the study to ascertain the perception of 600 customers availing different services provided by the selected banks. The parameters like Reliability, Responsiveness, Tangibility, Empathy and Assurance were taken. The area selected for the study was three districts of Punjab: Patiala, Chandigarh (including Mohali) and Ludhiana. Stratified Random sampling method has been followed in order to achieve research objectives. A total of ten hypotheses were formulated in the study.