INTRODUCTION TO SERVICE SECTOR Service Sector is the lifeline for the social economic growth of a country.

It is today the largest and fastest growing sector globally contributing more to the global output and employing more people than any other sector. The real reason for the growth of the service sector is due to the increase in urbanization, privatization and more demand for intermediate and final consumer services. Availability of quality services is vital for the well being of the economy. In advanced economies the growth in the primary and secondary sectors are directly dependent on the growth of services like banking, insurance, trade, commerce, entertainment etc. The service sector is going through almost revolutionary change, it dramatically affects the way in which we live and work. New services are continually being launched to satisfy consumers existing needs and to meet the needs that they do not even know they had. Ten years ago people did not anticipate the need for email, online banking, web hosting, online reservation and many other new services, but today many of us feel we cannot survive without them. Similar transformations are happening in Business to business marketing. Service organisations vary widely in size. At one end are the huge international corporations operating in industries such as tourism, airlines, banking, telecommunication etc whereas on the other end of the scale is a vast array of locally owned and operated small businesses including parlours , hotels , laundry n numerous business to business services. The various sectors that combine together to constitute service industry in India are stated as under:
Trade Hotels and restaurants Railways Other transport and storage Communication (post and telecom) Banking Insurance Dwellings, real estate Business services

 Public administrations, defence Personal services Community services Other service

INTRODUCTION OF BANKING SECTOR : A bank is an institution that deals with money and credit. Different people understand meaning of a bank in different ways. For a common man, bank is a storehouse where money is stored, for a businessman it is a financial institution and for a day to day customer it is an institution where he can deposit his savings. Banks play an important role in the economy of any country as they hold the savings of the public. Provide means of payment for goods and services and provide necessary finance for development of business and change. Thus bank is a link in the flow of funds from the savers to the users hence they should render efficient customer service in order to retain the present customers and also to attract the potential customer. In the past the banks did not face any attraction in the Indian economy because of the low level of the economic activities and the little business prospects. Today we find positive changes in the national business development policy. Earlier the moneylenders had a strong hold over the rural population which resulted in exploitation of small and marginal savers. The private sector banks failed in serving the society. This resulted in the nationalization of 14 commercial banks in 1969.There was a basic change in the banking concept with a beginning in the nationalization of big commercial banks. The involvement of public sector banks, transformed the Indian economy. The Indian banking can be broadly categorized into nationalized (government owned), private banks and specialized banking institutions. The Reserve Bank of India acts a centralized body monitoring any discrepancies and shortcoming in the system. Since the nationalization of banks in 1969, the public sector banks or the nationalized banks have acquired a place of prominence and has since then seen tremendous progress. The need to become highly customer focused has forced the slow-moving public sector banks to adopt a fast track approach. The unleashing of products and services through the net has galvanized players at all levels of the banking and financial institutions market grid to look anew at their existing portfolio offering. Conservative banking practices allowed Indian banks to be insulated partially from the Asian currency crisis.

Indian banks are now quoting a higher valuation when compared to banks in other Asian countries (viz. Hong Kong, Singapore, Philippines etc.) that have major problems linked to huge Non Performing Assets (NPAs) and payment defaults. Co-operative banks are nimble footed in approach and armed with efficient branch networks focus primarily on the 'high revenue' niche retail segments. The Indian banking has finally worked up to the competitive dynamics of the 'new' Indian market and is addressing the relevant issues to take on the multifarious challenges of globalization. Banks that employ IT solutions are perceived to be 'futuristic' and proactive players capable of meeting the multifarious requirements of the large customer's base. Private Banks have been fast on the uptake and are reorienting their strategies using the internet as a medium The Internet has emerged as the new and challenging frontier of marketing with the conventional physical world tenets being just as applicable like in any other marketing medium. The Indian banking has come from a long way from being a sleepy business institution to a highly proactive and dynamic entity. This transformation has been largely brought about by the large dose of liberalization and economic reforms that allowed banks to explore new business opportunities rather than generating revenues from conventional streams (i.e. borrowing and lending). The banking in India is highly fragmented with 30 banking units contributing to almost 50% of deposits and 60% of advances. Indian nationalized banks (banks owned by the government) continue to be the major lenders in the economy due to their sheer size and penetrative networks which assures them high deposit mobilization. The Indian banking can be broadly categorized into nationalized, private banks and specialized banking institutions. The Reserve Bank of India acts as a centralized body monitoring any discrepancies and shortcoming in the system. It is the foremost monitoring body in the Indian financial sector. The nationalized banks (i.e. government-owned banks) continue to dominate the Indian banking arena. Industry estimates indicate that out of 274 commercial banks operating in India, 223 banks are in the public sector and 51 are in the private sector. The private sector bank grid also includes 24 foreign banks that have started their operations here. The liberalize policy of Government of India permitted entry to private sector in the banking, the industry has witnessed the entry of nine new generation private banks. The major differentiating parameter that distinguishes these banks from all the other banks in the Indian banking is the level of service that is offered to the customer. Their focus has always centered around the customer - understanding his needs, pre-empting him and consequently delighting him with various configurations of benefits and a wide portfolio of

products and services. These banks have generally been established by promoters of repute or by 'high value' domestic financial institutions. The popularity of these banks can be gauged by the fact that in a short span of time, these banks have gained considerable customer confidence and consequently have shown impressive growth rates. Today, the private banks corner almost four per cent share of the total share of deposits. Most of the banks in this category are concentrated in the high-growth urban areas in metros (that account for approximately 70% of the total banking business). With efficiency being the major focus, these banks have leveraged on their strengths and competencies viz. Management, operational efficiency and flexibility, superior product positioning and higher employee productivity skills. The private banks with their focused business and service portfolio have a reputation of being niche players in the industry. A strategy that has allowed these banks to concentrate on few reliable high net worth companies and individuals rather than cater to the mass market. These well-chalked out integrates strategy plans have allowed most of these banks to deliver superlative levels of personalized services. With the Reserve Bank of India allowing these banks to operate 70% of their businesses in urban areas, this statutory requirement has translated into lower deposit mobilization costs and higher margins relative to public sector banks. Banks are now the most significant players in the Indian financial market. They are the biggest purveyors of credit, and they also attract most of the savings from the population. The Indian banking can be broadly categorized into nationalized (government owned), private banks and specialized banking institutions. The Reserve Bank of India acts a centralized body monitoring any discrepancies and shortcoming in the system. The need to become highly customer focused has forced the slow-moving public sector banks to adopt a fast track approach. The unleashing of products and services through the net has galvanized players at all levels of the banking and financial institutions market grid to look anew at their existing portfolio offering. Driven by the socialist ideologies and the welfare state concept, public sector banks have long been the supporters of agriculture and other priority sectors. They act as crucial channels of the government in its efforts to ensure equitable economic development. The liberalize policy of Government of India permitted entry to private sector in the banking, the industry has witnessed the entry of nine new generation private banks. The major differentiating parameter that distinguishes these banks from all the other banks in the Indian banking is the level of service that is offered to the customer. Their focus has always centred around the customer - understanding his needs, pre-empting him and

consequently delighting him with various configurations of benefits and a wide portfolio of products and services. These banks have generally been established by promoters of repute or by 'high value' domestic financial institutions. Today, the private banks corner almost 4% share of the total share of deposits TYPES OF BANKS There are various types of banks which operate in our country to meet the financial requirements of different categories of people engaged in agriculture, business, profession, etc. On the basis of functions, the banking institutions in India may be divided into the following types: Types of Banks a) b) c) d) (i) (ii) a) (i) (ii) Central Bank (RBI, in India) Development Banks Specialized Banks (EXIM Bank, SIDBI, NABARD) Commercial Banks Public Sector Banks Private Sector Banks Co-operative Banks Central Co-operative Banks State Co-operative Banks

MARKET SEGMENTATION An organization is supposed to cater to the changing needs of customers; it is only natural that all customers have their own likes and dislikes. They have some uniqueness, which throws a big imprint on their lifestyles. This makes the task of understanding a bit difficult. It has the context that we go through the problem of market segmentation in the banking service. The study of the needs of customers invites a plethora of problems since in addition to other aspects; the regional considerations also influence the hierarchy of needs. To be more specific in the banking services, the banking organizations are supposed to satisfy different types of customers living in different segments.

The segmentation of market makes the task of bank professionals easier. If the market segmentation is done in a right fashion, the task of satisfying the customers is simplified considerably. The modern marketing theories advocate the formulation of marketing policies and strategies for each segment, which an organization plans to solicit. The marketing segmentation is based in the principle of divide and rule. If we divide the market into different segments, the size of market is made small and the process of study is found convenient. We find market segmentation division and subdivision of a market based on considerations. The bank professionals have to segment the market in such a way that the expectations of all potential customers are studied in a right perspective and the marketing resources are developed to fulfil the same. The marketing efforts can be made more proactive if the process and bases of segmentation are right. It is essential that the bank professionals assign due weightage to the difference that we find in the market behaviour due to geographical, age, sex, nationality, educational background, income classes, occupation, social and other considerations. If they overlook or underestimate key bases while segmenting, the study results can't be proactive to the formulation of creative marketing decisions. This makes it essential that the bank professionals are well aware of the criteria for market segmentation. The agriculture sector, industrial sector, services sector, household sector are found important in the very context. The gender segment is found important no doubt but we can't underestimate institutional and professional segments. Since the banking organizations serve different sectors and segments, the segmentation should be done carefully. IMPORTANCE OF SEGMENTATION 1. Instrumental in exploring opportunities:

We find market segmentation very much effective in exploring the profitable opportunities. It is well known to us that while segmenting, the market is divided into different groups and sub-groups and this simplifies the process of studying and understanding the customers in a right perspective. If we know about the rural segment, the opportunities are explored to the rural areas. If we know about the women segment, the opportunities are identified in that area. If we know about the low- income group, the opportunities are identified in that group. Thus the segmentation helps the bank professionals in exploring the profitable opportunities.

2.

Instrumental in designing a sound marketing strategy:

We can't deny that market segmentation makes it easier to formulate a sound strategy. Since the banking professionals are aware of the changing needs and requirements of a segment, the marketing resources can be developed in tune with the needs and requirements of a segment. The formulation of a package is found significant and the bank professionals can do it successfully on the basis of market segmentation. The promotional measures can be satisfied in the face of receiving capacity of a particular segment. The pricing strategy can be made operational and the sales promotion measures can be made productive. 3. Helpful to the policy planners:

In addition, the policy makers also find segmentation since they are well aware of the emerging trends in the business environment. They get detailed information about the changing needs and requirements of a segment. The planning is an ongoing process. The banking professionals transmit necessary information to the policy planners, which simplifies the process of making a sound policy. 4. Enriching the market resources:

In addition to other aspects, we find segmentation instrumental in enriching the marketing potentials. If we know about the preference, needs, requirements, attitudes, lifestyles it is found easier for us to develop the marketing resources accordingly. This in a natural way makes it convenient to develop marketing resources. The process of innovation can be activated. The services, the promotional measures, the pricing tool and the process of offering can be made more competitive. The development of world-class marketing . 7 P's of Banking sector PRODUCT : A product can be defined as a bundle of utilities consisting of various product features accompanying services. Bank services are viewed with not just things that are created with value but they are seen in terms of satisfaction they deliver. E.g. A bank account is seen in terms of customer satisfaction such as safety, convenience of paying dues keeping records status, transferring funds, etc.

I.Bank Products
DEPOSITS ADVANCES

PRICE MIX The price mix in the banking sector is nothing but the interest rates charged by the different banks. In today's competitive scenario whercustomer is the king, the banks have to charge them interest at a rate in accordance with the RBI directives. Banks also compete in terms of annual fees for services like credit cards, DMAT etc. Another important aspect of the bank's pricing policy today is the interest charged on the Home Loans and Car Loans. With India's economy progressing, there are more and more buyers seeking these loans but at a very competitive interest rate. Let's understand this with an example. A particular buyer approaches a bank for a car loan for a period of 3 years. He is charged Rs. 20,000 as interest. However, if a sale representative of another bank comes to know of this deal, he will try to attract the customer by giving him a better deal i.e. a loan at a lower rate on interest. In this way, it is the customer that ultimately benefits. PLACE MIX Place mix is the location analysis for bank's branches. There are number a factors affecting the determination of the location of the branch of bank. It is very necessary for a bank to be situated at a location where most of its target population is located.

PROMOTION MIX Promotion is nothing but making the customer more and more aware of the services and benefits provided by the bank. The banks today can use a lot of new technology to communicate to their customers. Two of the fastest growing modern tools of communicating with the customers are: 1. 2. Internet Banking Mobile Banking

This can be better explained with the example of ICICI bank: SMS services:

SMS functions through simple text messages sent from your cellular phone. These messages are recognized by ICICI bank to provide you with the required information. For example, when you enter 'IBAL' your cellular phone screen will display the current balance in your primary account. Thus with the help of SMS a wide range of query based transactions can be performed without even making a call. ICICI was the first organization in India to provide Wireless Application Protocol (WAP) based services. Mobile commerce using WAP technology, allows secure online access of the web using mobile devices. With WAP one can directly access the ICICI WAP server, check one's account details and use other value added services. Thus different methods are used by different banks to promote its services. A bank may have very attractive schemes and services to offer to their customers but they are of no use if they are not communicated properly to the customers. Promotion is to inform and remind the individuals and persuade them to accept, recommend or use of product, service or idea. However there some very important points that is to be considered before the promotion strategy is made. These points are: Finalizing the Budget : Before the bank decides the kind of promotion that should be done, it is very important to finalize the budget for it. The formulation of a sound budget is essential to remove the financial constraints in the process. The budget is determined on the basis of volume of business of the bank. In addition to this the intensity of competition also plays a decisive role. Selecting a suitable vehicle: Another very important task is to select a suitable vehicle for driving the message. There are a number of devices to advertise such as broadcast media, telecast media and the print media. The selecting of the mode of advertising is strongly influenced by the kind of budget decided. Usually for promoting banks the most effective and economical form of advertising has been the print media. Making possible creativity Making possible creativity is nothing but the kind of slogans, punch lines etc. that are supporting the message. They should be very creative but yet simple to be understood by the common man. It should appeal to the customers. It

should be distinct from that of the competitors and should be successful in informing and sensing the customers. Testing the Effectiveness : It should be borne in mind that the advertisement is first tested for its effectiveness. This should be done with the help of various techniques like testing effectiveness on a sample group. This helps determine the success of the advertisement and in case of any problem the advertisement can be altered and remedied. Instrumentality of Branch Managers : At a micro level, it is the responsibility of the branch managers to promote and drive the message to the people in the local area. They should organize small programs in order to attract people and crate awareness in the local area about the new schemes of the bank. Different Ways of Promotion 1. Public Relations:

In today's competitive scenario developing strong public relations is very important for any bank to be successful. Most banks today have a separate Public Relations department. However primarily it is considered as a responsibility of the various bank managers to develop a steady and strong relationship with their present customers as well as potential customers. This can be done by a constant follow up, small programmes etc. 2. Personal Selling:

Personal selling is found to be one of the most effective and popular forms of promoting bank business. The main reason for this is that banking is a service in which trust plays a very important role. In personal selling, a bank representative goes to the customers and explains the scheme to the customers. Also he gives the customers any kind consultation he might need. He provides the customers all the information sought by him. The representative tries to persuade the customers to go for the scheme provided by the bank by telling him all the benefits. Here are some of the important features of personal selling It is a direct relation between the buyers and the seller It is oral presentation in conversation

It is personal and social behaviour

It is found to be more effective in service oriented organizations It is based on the professional excellence or expertise of an individual 1. Sales Promotion:

Sales promotions are basically giving the customers some additional benefits, maybe at times just some small gifts, in order to promote the schemes. The more innovative the sales promotions the more positive are the results. Some of the most popular sales promotions techniques are gifts, contests, fairs and shows, discounts and commission, entertainment and travelling plans for bankers, additional allowance, low interest financing etc. It is very important that the sales promotions benefits are designed in such a manner that they are better than those of the competitors. 2. Word - of - mouth Promotion:

This form of promotion is not only very effective in banking services but in any kind of service. However it is more important in banking for the only reason that this is a service where trust plays a very important role. If a particular bank's services are recommended by friends, relatives, or other well wishers the person is more influenced and inclined towards that bank. It is very important to note that the internal employees of the bank play a very important role in word - of - mouth promotion technique. This is because they can start the process by recommending the bank to their friends and relatives and after that it is like a chain, which spreads like a wild fire. 3. Telemarketing:

In recent times telemarketing has gained increasing importance as an effective tool for promotion. Telemarketing is a process of making use of sophisticated communication network for promoting the banks. This includes promoting through television, telephone, and radio. Nowadays, cell phones are used extensively for the same. This is the most popular form of promotion. Banks today have started using 'SMS' and many other services supported by cell phones to provide benefits to their customers and thus have tried to increase their sales. In today's competitive and modern scenario it very important that banks makes use of telemarketing techniques very efficiently to have desirable results. PEOPLE:

People are the employees that are the service providers. In a banking sector, the service provider plays a very important and determinant role in rendering the customers a satisfactory and a good service. It is extremely essential that the service provider understand what his customers expect from him. In the banking sector, the customer needs to be guided in a lot of matters, which is possible only with the help of the service provider. The position in the eyes of the customer will be perceived by appearance, attitude and behaviour of the customer contact employees. Not only does the customer contact employee influence the customer's perception but also the customer base of the organization does so. PROCESS MIX: The process mix constitutes the overall procedure involved in using the services offered by the bank. It is very necessary that the process is very customer friendly. In other words a process should be such that the customer is easily able to understan and easy to follow. Today if particular banks formalities are long and the procedure very complicated the overall process fails and the customer may not be inclined towards using that banks services. Let's take for example the process for application for a car loan at HDFC bank. Now this mainly involves 3 things. 1. 2. 3. Producing of proper documents Filling up of application form Paying for the initial down payment

Here the process may fail in the following cases: 1. If the customer is asked to produce a number of forms out of which some may not be necessary at all. Thus it is very necessary that the customer be asked for the minimum but most necessary document and not the other unnecessary documents. 2. In case of application form, the application form must be in a language best understood by the customers and it should not be very lengthy or demanding a lot of unnecessary information. 3. Finally the payment of initial amount. The customer should be given options as to how he would like to pay by cheques or by credit card. Once again the amount should be very competitive not very high above the regular

rates prevailing in the markets. The smaller and simpler the procedure, the better the process, and the customer will be more satisfied. PHYSICAL EVIDENCE Physical evidence is the overall layout of the place i.e. how the entire bank has been designed. Physical evidence refers to all those factors that help make the process much easier and smoother. For example, in case of a bank, the physical evidence would be the placement of the customer service executive's desk, or the location of the place for depositing cheques. It is very necessary that the place be designed in such a manner so as to ensure maximum convenience to the customer and cause no confusion to him.Let us see an example as to how banks try to make little changes so as to make the service better for their customers. The Hong Kong Shanghai Banking Corporation (HSBC) had decided in introducing a common uniform for all the employees in all its branches all over India. The plan is possibly in line with the aggressive retail banking adopted by HSBC. A common uniform is nothing like a revolutionary change but however this little change makes it very easy for the customer to identify with his service provider and makes the entire process very easy for him. The more the bank does to make the service easier the better it is for the customer. Thus, these are the 7 P's of services. Each of them plays a very important and a pivotal role in determining the quality of the service provided to the customer. QUALITY DIMENSIONS There are many reasons why a customer should be given QUALITY SERVICES. The most of them are: 1) Industry being so competitive that a customer should be given the best services as they have many competitors (the company) and if even a single customer is lost in today's world then it very difficult to win back the customer. 2) Most of the customers do not complain as they just opt out and do get satisfied with better services elsewhere. When it comes to services, there are 10 quality dimensions. Each of the dimensions is of utmost importance since human element is involved and it relates to services. But Zeithaml, Bitner and Parsuraman have developed a new and concise model by clubbing some points. This model consists of the following dimensions:

 Reliability Assurance Tangibility Empathy Responsiveness

RELIABILITY: It is defined as the ability to perform the promised service dependably and accurately. In its broadest sense, reliability means that the company delivers on its promises-promises about delivery, service provision, problem resolution, and pricing. It is also known as the "No Excuses" service delivery. Indian Overseas Bank faces stiff competition from many other banks within its vicinity and some of these banks are foreign banks. But the existing customers have faith, loyalty and trust in this bank. The customers are well aware that the bank will provide them back the best and reliable services. For e.g. No person likes to wait to withdraw his/her money. In order to correct this problem, Indian Overseas Bank has ensured that whoever comes in for cash withdrawal will receive his/her cash within five to ten minutes. ASSURANCE Assurance is defined as employee's knowledge and courtesy and the ability of the firm and its employees to inspire trust and confidence. It includes the ability, knowledge, genuineness, and honesty to provide the best services to the customer from the frontline staff. In this dimension the front line staffs is more important rather than the owner. At Indian Overseas Bank, every customer who comes is treated with utmost care and any problem that takes place is solved with great enthusiasm. It assures the customers coming up to the bank that the money they invest is secure; the interest rate that is being provided to them is at par or sometimes even higher as compared to other banks. Also, it assures the customers that the money they have invested will be returned to them as and when required with proper interest. It tries to empower their customer, contact people and regularly train them in skills to build trust and loyalty between employees and the customer. TANGIBLITY
Tangibles are defined as the appearances of physical facilities, equipments, personnel and

communication materials. All of these provide physical representations or images of the service that customers, particularly new customers, will use to evaluate quality. At Indian Overseas Bank, the entire premise is air-

conditioned. They have computerized systems in place and therefore quick, accurate and efficient service can be provided to the customers. The tables and chairs are conveniently located for the customers. The personnel always have a cheerful and helping veneer and are always ready to help out the customers. The entire place is done up in bright colours and thus the customer can immediately feel the warmth and the radiance of the place. EMPATHY Empathy is defined as the caring, individualized attention the firm provides its customers. The essence of empathy is conveying, through personalized or customized service, the customers are unique and unique special. The empathy shown by the employees of the Indian Overseas Bank is good as they are always polite humble and helpful. There was a case where once a customer misplaced Rs. 1,00,000 within the premises of the bank. He panicked but the bank personnel put him at rest and assured him that they would locate the same for him. Since he was a regular customer, they knew him very well and took the situation under control. They quickly located the cash and thus, the customer was placated. The bank personnel went out of their way to help this customer and thus understood his predicament. This bank regularly holds seminars and training workshops so that they can understand the consumer better and thus serve him better. RESPONSIVENESS Responsiveness is the willingness to help the customer and provide him with immediate and fast service. The Indian Overseas Bank is prompt at providing its customers with the information and services that they seek. It is extremely prompt when it comes to resolving the complaints of the customers. The customers, in their feedback form, mentioned this as one of the most important factor that has prompted them to continue with this bank. All the five dimensions basically aim at serving the customers to the best of their ability, giving them quality services and if things are followed as they are demanded, (i.e., according to the customers demand) then there would be no problems in facing any type of people. The successful service organizations set up speeds for service standards Technologies & Innovations in Banking Technologies in Banking

Technology plays a very important role in bank's internal control mechanisms as well as services offered by them. It has in fact given new dimensions to the banks as well as services that they cater to and the banks are enthusiastically adopting new technological innovations for devising new products and services. The latest developments in terms of technology in computer and telecommunication have encouraged the bankers to change the concept of branch banking to anywhere banking. The use of ATM and Internet banking has allowed 'anytime, anywhere banking facilities. Automatic voice recorders now answer simple queries, currency accounting machines makes the job easier and self-service counters are now encouraged. Credit card facility has encouraged an era of cashless society. Today MasterCard and Visa card are the two most popular cards used world over. The banks have now started issuing smartcards or debit cards to be used for making payments. These are also called as electronic purse. Some of the banks have also started home banking through telecommunication facilities and computer technology by using terminals installed at customers home and they can make the balance inquiry, get the statement of accounts, give instructions for fund transfers, etc. Through ECS we can receive the dividends and interest directly to our account avoiding the delay or chance of losing the post. Today banks are also using SMS and Internet as major tool of promotions and giving great utility to its customers. For example SMS functions through simple text messages sent from your mobile. The messages are then recognized by the bank to provide you with the required information. All these technological changes have forced the bankers to adopt customer-based approach instead of product-based approach. Electronic Banking: With the introduction of computers in Indian banks and with the advent of ATM's the banking services are provided across the banks. Customers need not necessarily visit the bank to do banking transactions when the bank provides them with tele banking and or remote banking facilities. This type of banking is called electronic banking and the concept is becoming popular with individual as well as corporate entities in India. 1. Automated Teller Machines (ATMs):

ATM's have eliminated the time limitations of customer service and offer a host of banking services including deposits, withdrawals, requisitions, instructions and transactions. ATM's traditional and primary use is to dispense

cash upon insertion of a plastic card and its unique PIN or personal identification number. It is issued to Current and Saving account holders of a bank who hold a certain minimum balance. When the card is inserted into the ATM, the machine sensing equipment identifies the account holder and asks for his or her identification PIN number. This number is not even known to the bank staff and is unique and secret to the individual 2. Internet Banking:

Banks have over a long time been using electronic and telecommunication network for delivering a wide range of value added products and services. The delivery channels include dial-up connection, private network, public network etc and the devices include telephone personal computers including the ATM etc. With the popularity of PC's and easy access to the internet and World Wide Web banks increasingly use internet as a channel for receiving instructions and delivering their products and services to their customers. This form of banking is often referred to as internet banking, although the range of products and services offered by different banks, vary widely both in their content and sophistication. 3. Mobile Banking:

Through inter -banking one can visit the web -site of each bank by entering his password and known the account balance and even pass his own credit and debit entries. This means that we can do our banking through our personal computer settings at home. Banks may soon allow zero balance savings accounts through internet facility only. Customers can now make balance enquires download statements and open fixed deposits over the net. They will soon be able to carry out all their transactions over the net. So visiting a bank would be needless. Time to come; mobile phones will drive banking transactions. These mobile phones will drive banking transactions. These mobile phones will be equipped with smart cards that are embedded with banking and other information. This mobile phone banking facility is yet to come but the mechanics of linking the banking with the cell phone is being sorted out. Teller machines are being installed in the banks for the electronic banking facility. Banking will be on wheels and mobile by the use of smart banking. 4. Note and coin counting machines:

To reduce the need of manual counting, note and counting machines are available which counts a bundle of notes placed on it. Loose notes are inserted into the machine. The machine then counts the notes at top speed, while simultaneously indicating the number counted on a digital display. Every time the number reaches 100, the machine stops, subject to it being fixed at 100 and allows for the bundle to be taken out. This machine does relieve the drudgery involved in counting. However, one limitation of this machine is that the notes have to be in fairly good condition for the machine to able to count properly. However, the machine requires all the notes to be in the same denomination. 5. Electromagnetic Cards:

In the modern days of commerce credit cards have acquired a fairly prominent and pervasive role. With the increasing use of credit cards the society is moving towards cashless transactions. In India however the use of credit cards is restricted to small value and mostly personal transactions. The two international credit card giants viz, Visa international and Master Card international are poised to make deeper inroad in untapped Indian market. Types of electromagnetic cards: 1) Charge card: In such cards transactions are accumulated over a period of time generally a month and the total amount is charged i.e. debited to the account. In charge card the amount becomes payable immediately on the debit to the account. 2) Credit card: This is the same as charge card where the transactions are charged to the account with the total value of transaction debited to the card holder's account once in a month. The difference between the credit and charge card is that in case of the credit card holder is given about 25 to 50 days time to credit his account in case there are insufficient funds in his account at the time of debit. 3) Debit card: A bank-issued card that allows its users to access their funds for the purpose of paying for merchandise. 4) Smart card: There are two types of smart cards intelligent memory chip and micro processor cards. The memory smart cards have been around for several years they are being used in paying phones, identification, access control, voting and other applications. Processer smart cards are the most

advanced and are ideally suited for banking and financial application where re use of the card is allowed. 5) Member card: This is used by members of a club or a chain of hotels. E.g. the Taj Card is a card issued by the Management of the Taj group of Hotels to be used by patrons of their hotels .Similarly there are many other types of cards where the usage is exclusive to the members of the group.

Conclusion: With the development of modern communication facilities, electronic payment systems are becoming popular. These are teller machines available for bank customers within the bank as well as outside the bank premises. ATM's which are being located even at public places, are able to provide the customers minimal banking services including cash payments round the clock. Shared ATM's are also introduced in India where the services are provided

across the banks. Customers need not necessarily visit the bank to do banking transactions when their banker provides them tele-banking or remote banking facilities. We have also seen that the various electronic and electro-mechanical aids that help the modern banker to efficiently render innovative and novel customer service. Equipments like note and coin counting machines help the banker to take care of the tedium in his task, reduce drudgery and at the same time efficiently discharge his functions. These technological aids not only take care of some of the physical routine tasks but also contribute substantially to efficient housekeeping functions and also render services that are in tune with the customer needs and satisfaction.