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Electronic copy available at: http://ssrn.

com/abstract=990242
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Customer Satisfaction of ATM Service: A Case Study of HSBC ATM
Dr. Md. Rafiqul Islam
Dr. Samir Kumar Sheel
Pallab Kumar Biswas
*
Abstract:
The Automated Teller Machine (ATM) is one type of innovation that can mechanically
accept deposits, issue withdrawals, transfer funds between accounts, collect bills, and
make small loans. This study aims at investigating the satisfaction levels of HSBC ATM
cardholders (both staff and nonstaff) with respect to various aspects (promptness of card
delivery, the performance of HSBC ATM, the service quality of ATM personnel etc.) of
using HSBC ATM and their opinions on various other related issues (such as positive and
inconvenient features of HSBC ATM, recommendation to improve the service quality
etc.). This study is one type of exploratory research using convenience sampling
technique where samples have been selected on the basis of convenience. Thus, projecting
data beyond the sample is statistically inappropriate. This study only provides
information for analyzing ATM scenario of HSBC. Though the samples were selected on
a convenience basis and it may not represent the whole population, but still it is no less
important for the HSBC management to consider the recommendations with due care for
better customer service and for being in a better competitive position.
Keywords: ATM card, Machine breakdown, Unsuitable location, currency quality.
1.0 Introduction
1.1 Background of the Study:
Technology is revolutionizing the financial services industry through various unthinkable
innovations. The volume of cross-border trading and other financial activities is increasing
geometrically facilitated by technology. The influence of technology over product innovations in
banks is enormous. In innovation process banks have to decide which products they wish to sell,
whether they wish to build those products themselves, how they should deliver, and why they
wish to deliver them to customers (Raihan 2001). Innovation is the art of overcoming constraints
toward development. It occurs when a new or changed product or service is introduced to the
market, or when a new or changed process is used in a commercial situation. No organization can
remain happy with the existing products to cope with the competitors. Banks are no exception to
this situation (Shahid 2004). The Automated Teller Machine (ATM) is such type of innovation
that can mechanically accept deposits, issue withdrawals, transfer funds between accounts, collect
bills, and make small loans. HSBC is one of the leading organizations in the modern financial
world. . It started its operation in Bangladesh in 1996. Since then, it is their strategic decision to
bring all modern technologies such as ATM, Easy Pay Machine etc. in banking in Bangladesh.
This decision was to keep them in the market in a superior position competing in the market
providing better services with various alternative channels 24 hours-a-day, and 7 days-a-week.
The growth rate of HSBC ATM users are shown in the following table:
Table 1: Growth rate of HSBC ATM users
Particulars July 2000 July 2001 July 2002 July 2003 July 2004 July 2005
Growth rate - 240.65% 98.37% 36.67% 42.36% 27.67%
*
Dr. Md. Rafiqul Islam and Dr. Samir Kumar Sheel are Associate Professors, Department of Marketing,
University of Dhaka, and Pallab Kumar Biswas is a Lecturer, Faculty of Business Administration,
Eastern University.
Electronic copy available at: http://ssrn.com/abstract=990242
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The above table shows that the use of HSBC ATM is increasing day by day. So it is high time to
investigate how the customers feel with the HSBC ATM, what are their newer demands etc.
1.2 Statement of the Problem and Objectives of the Study:
Commercial banking is considered as a service industry. In the process of conducting its own
activities to achieve its own goals, i.e. making profit, a commercial bank provides various
ancillary facilities (Ghosh 1981). Automated Teller Machine (ATM) is such an ancillary facility.
ATM is a part of the electronic financial transactions systems. In Bangladesh, different banks are
now offering ATM cards to their valued customers. The Hongkong and Shanghai Banking
Corporation Limited (HSBC) also introduced the ATM facility in 1999. Different studies have
been conducted by the internal management of this bank to have an idea about customer
satisfaction about various banking products of HSBC, but no study has been undertaken to
identify the level of customer satisfaction with respect of various aspects of HSBC ATM. But as
day-by-day the use of ATM is increasing, it is important to make a study to gain insight about the
level of customer satisfaction with respect to various aspects of HSBC ATM and to identify the
problem areas and proposed recommendation leading to improvement. This study is such an
attempt.
The main objectives of the study can be stated as below:
(a) To examine the level of nonstaff customer satisfaction associated with various aspects
of HSBC ATM (such as promptness of card delivery, the performance of HSBC
ATM, the service quality of ATM personnel etc.);
(b) To examine the level of staff customer satisfaction associated with various aspects of
HSBC ATM; and
(c) To make policy recommendations to improve the service quality of HSBC ATM.
1.3 Rationale of the Study:
The findings of the study will provide information to use in analyzing the current ATM situation
of HSBC. As the use of ATM services is increasing day-by-day, on the part of the bank, it is
important to have an idea about what the ATM users are thinking about various features of ATM,
what are their problem areas, what are their recommendations, how do they compare the ATM
service of this bank with that of any other banks etc. The banks marketing department also needs
to have idea about the results of such types of study to determine appropriate marketing strategy.
Thus the findings of the study will be very useful to them and it will also help the ATM section to
identify their positive and negative features and the customer recommendation. The bank
management can take actions on the basis of customer recommendations to improve the services
and further growth assuming that the customers selected on the basis of convenience represent the
whole population.
1.4 Limitations of the Study:
In undertaking the study, a number of problems were faced. Thus the study has several
limitations. The limitations are:
(a) The survey conducted for the study is one type of exploratory research. So it does not
provide conclusive evidence. Subsequent research will be required to provide conclusive
evidence.
(b) In this study because of acute time shortage and organizational restriction, nonprobability
sampling technique (convenience sampling) has been used. So it is inappropriate to project
the results of the survey beyond the specific sample.
(c) In this study detailed classification of respondents could not be done. Each respondent
might have been classified on the basis of their Age, Educational Background;
Experience; Nature of profession; Types of Business; Sex; Status; etc. Analysis
may be diversified done on the basis of this classification.
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(d) As the sample size is very small, geographical and regional differences could not be made.
(e) Because of time constraint, this study includes only Dhanmondi CSC and Uttara CSC other
than head office ATM.
2.0 Methodology of the Study
2.1 Population and Sample:
As a case study, the study covers only the HSBC. The population defined for this study was
limited to the ATM users of HSBC and the Staff ATM users of HSBC head office. The
population represents all the HSBC ATM users. In this study convenience sampling technique has
been used. On the basis of convenience, 57 nonstaff ATM users and 42 staff ATM users were
selected.
2.2 Database and Procedure of Analysis:
Both primary and secondary data were used for the purpose of the study. One set of structured
questionnaire was used to collect primary data for the study. Knowledgeable and potential
respondents were consulted to make the questionnaire all inclusive i.e., all possible answers were
given in the questionnaire. In the questionnaire responses were sought from various ATM users
regarding their levels of satisfaction on various issues, opinion regarding the positive and
uncomfortable features of HSBC ATM etc. In the questionnaire, respondents were asked ten
questions of which eight were related to their level of knowledge and comments on various issues
of the HSBC ATM. Two questions were asked to measure the level of satisfaction. In one
question, respondents were asked to indicate their level of satisfaction regarding various aspects
of the ATM (such as promptness of card delivery, performance, service quality of ATM
personnel, quality of currency notes) of HSBC ATM on a 5-point scale (1 for Very Unsatisfied
to 5 for Very Satisfied). In another question, a respondent simultaneously using other banks
ATM was asked to compare the ATM service of HSBC with the service of other ATM used by
him/her again on a 5-point scale (1 for Very Poor to 5 for Very Good). The questionnaire is
shown in the appendix.
After developing the questionnaire, it was given to two groups of respondents: HSBC head office
staff who use HSBC ATM and nonstaff general HSBC ATM users. The staff users filled in the
questionnaire themselves. For nonstaff ATM users, the survey has been conducted personally at
selected ATM booths. Respondent ATM users have been explained the objectives of the study
and requested to fill in the questionnaire in the spot.
Besides many secondary sources have been used for supplementary purpose. Secondary sources
include banks annual report, the group ATM branch procedure manual, relevant web-based
materials and prior research reports.
Data have been analyzed by using descriptive statistics. Mean levels of satisfaction of the two
groups of respondents (nonstaff and staff ATM users) were calculated. By using these mean
levels of satisfaction, information has been provided to use in analyzing the situation. As it is an
exploratory research and convenience sampling technique has been used in selecting samples, this
study does not provide conclusive evidence to determine particular courses of action.
2.3 Key Terms Used:
For the purpose of the study, various key terms have been used, which are explained below.
ATM: An automatic/automated teller machine (ATM) is an electronic device which allows a
banks customers to make cash withdrawals and check their account balances at any time without
the need for a human teller. Many ATMs also allow people to deposit cash or cheques, transfer
money between their bank accounts or even buy postage stamps.
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ATM card: An ATM card is a plastic card that looks like a credit card. It allows the bank account
holder to do the same things at a bank machine or Automatic Teller Machine (ATM) as he would
at a bank. One can get cash, deposit money, check account balances, and receive a copy of your
statement--all electronically--by using your ATM card and the password to your account, which is
called your Personal Identification Number, or PIN (www.thebeehive.org).
Debit card: Debit card is plastic card issued by a bank or building society to enable its customers
with cheque accounts to pay for goods or services at certain retail outlets using the telephone
network to debit their cheque accounts directly (Woelfel, 1994).
Credit card: Credit card is plastic card issued by a bank or finance organization to enable holders
to obtain credit in shops, hotels, restaurants, petrol stations etc. The customer receives monthly
statements from the credit card company. This may be paid in full within a certain number of days
with no interest charged or by means of a specified minimum payment plus a high rate of interest
on the outstanding balance. The retailer or trader receives monthly payments from the credit card
company equal to the total sales in the month by means of that credit card, less a service charge
(Woelfel, 1994).
Card mailer: A computer printed Bank Form with the address of the customer, PAN, date and a
reference number used as the means of identifying which card and its presentation folder should
be handled to which customer. ATM centre retains the card mailer after the customers signed in
acknowledgment for the card.
Card collection advice: A computer printed bank form sent out to the customer to advise his/her
ATM card is ready for collection from their branch of account.
GATS: Global ATM Switch Processor which is located in Hong Kong and performs switching of
message, settlement and related services.
Pin advice: A sealed envelope within which PIN is enclosed. The PIN advice and the PIN mailer
are enclosed in a single window envelope and handed to the customer.
3.0 Evolution of ATM
There has been a great deal of debate over the history of ATM, including who the ATMs inventor
is. According to Invention & Technology Magazine (2000) in the late 1930s, Luther George
Simjian started building an earlier and not-so-successful version of an ATM, but he register
related patents. Starting in 1939, Simjian registered 20 patents related to the device and persuaded
what is now Citicorp to give it a trial. But the patent was unsuccessful because after six months,
the bank reported that there was little demand. Afterwards New Yorks First National City Bank
(now CitiBank) installed a Bankograph (ATM predecessor) in several branch lobbies in 1960. The
idea was for customers to pay utility bills and receipts without having to see a teller. A Barclays
Bank branch near London takes the pride in installing first cash dispenser made by De La Rue
Instruments in 1967. It uses paper vouchers from tellers. The machine is called the De La Rue
Automated Cash System, or DACS. This was produced by NCR in Dundee. This instance of the
invention is credited to John Shepherd-Barron, although George Simjian registered patents in
New York, USA in the 1930s and Don Wetzel and two other engineers from Docutel registered a
patent on June 4, 1973. Afterwards Barclays and a few other banks introduce a machine that
encodes cash on plastic cards purchased from a teller in 1968. The problem is that the machine
always eats the cards, and customers have to buy new cards if they want to make more
transactions. First use of ATM magstripe cards started in 1969. Docutel installs its Docuteller
machine at New Yorks Chemical Bank. the installation marks the first use of magnetically
encoded plastic.Other manufacturers get into the game, but Docutel is the first to apply for a
patent. Docutel is later credited by Smithsonians National Museum for Americal History as being
the ATMs inventor. Doland C. Wetzel is given the credit for developing the Docutel machine.
Docutel introduces its Total Teller, the first true fully functioning bank ATM in 1971. after 1971,
proliferation begins to make the product more custoemr oriented. By 1973, 2000 ATMs- mostly
form Docutel are operating in the United States. They sell for about $30000 each. Diebold begins
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work on the development of the TABS 600 with plans for an off-line prototype. Diebolds first
TABS 500 machine, an off-line version, is installed at a bank in Atlanta in 1974.Diebold develops
the TABS 550, an on-line and off-line version. The flexibility of the machine makes it unique and
more marketable to banks. The TABS 600 also is developed. The first IBM-compatible Diebold
machine is installed at a bank in Indianapolis in 1978.Gradually with the popularity of ATM
services this sector has developed dramatically (http://inventors.about and
www.atmmarketplace.com). Although the 1st Cash Dispenser machine in Bangladesh was
installed by Agrani Bank at Press-club branch but the modern use of ATM started in Bangladesh
by Standard Chartered Bank in the early 90s. HSBC installed ATMs in 1997 and now they have
12 ATMs and 5 Easy Pay Machines (EPMs).
4.0 HSBC ATM: An Overview
The HSBC Group introduced Automated Teller Machine (ATM) services to HSBC Hong Kong in
1980. The acronym ETC (Electronic Teller Card) was selected for the card as the Chinese
translation meant easy flow of money. Therefore, ETC is the universally accepted title for the
Groups local ATM cards which provide local customers with ATM services. As the need for
money overseas increases, the Group has developed the ETCI (Electronic Teller Card
International), also known as Global Access Card, to meet the transaction needs of frequent
travelers.
With the rapid growth of HSBCs global ATM network in recent years, the network was formally
named Global Access in February 1992 with the Chairmans endorsement. The service is
available 24 hours a day and 7 days a week. The purpose of the ATM service is not only to the
public the progressive image of the Bank, but also to protect the market share of retail deposits if
not to increase it.
4.1 ATM service area of HSBC:
HSBC ATM (Automated Teller Machine)s are available in Dhaka and Chittagong covering
Motijheel, Gulshan, Banani, Dhanmondi, Uttara, Sonargaon Road, Shantinagar, and Agrabad &
GEC Circle respectively.Currently HSBC has 14 ATMs and 5 Easy-Pay Machines (EPMs). Non-
resident Bangladeshis having HSBC ATM card and selected group of Bangladeshi customers
having International card can access 800,000 ATMs through out the world. Foreigners having
HSBC card can also get access into HSBC Bangladesh ATMs when they visit Bangladesh.
4.2 Features of HSBC ATM:
The HSBC ATM enables the banks customers who are issued with an ETC/ETCI/Global Access
Card/Credit Card and a 6-digit secret number (or 4-digit number for some areas) known as a PIN
(Personal Identification Number), to comply with the local share ATM network regulation, to
perform a number of transactions on the current, savings or credit card accounts. Table 2
enumerates the variety of those transactions.
Table 2: Features of HSBC ATM
Cash Withdrawal
From the ATM booth any ATM card holder can withdraw 50,000 taka in a day
from his or her account. The customer of ATM card can withdraw in total 50,000
taka from any ATM booth as many times as he or she needs within 24 hours.
Transfer
Any amount up to account balance/available credit limit or daily cycle limit,
whichever is lower, can be transferred between accounts under the same issuing
bank within Bangladesh in any 24 hour period. In Bangladesh, the cycle limit is
BDT (Bangladesh Taka) 1,00,000.
Statement Request
The customer can send request to the bank by the ATM, when he/she requires
his/her detail Account statements. The statement generally shows a ledger balance
and an available balance, is the same format as a teller terminal balance request.
When any customer enter the card into the ATM machine it displays some options
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PIN Change
on the ATM screen, PIN Change is one of the options. Customer can change his
PIN whenever he desires e.g. if he is not happy with the PIN assigned by the bank,
or if he believes that his PIN is compromised. For new card, customer is advised to
change his PIN immediately.
Account Activity
Enquiry
The ATM users can have information regarding the account balance of his/her
account each and every time the ATM transaction is occurred. HSBC ATM has a
option to provide a mini statement showing his/her last 8 (eight) transactions.
Deposit/mail deposit Cash/Cheque, but not coins may be deposited in envelopes supplied by the ATM.
Cheque Book
Request
The customer can send request to the bank by the ATM for new cheque book, when
his/her current cheque book is finished.
Enquiry Customer can enquire about anything, like any service, product, facilities through
HSBCs ATM.
5.0 Previous Research Findings
A fair number of theoretical and empirical researches on ATM and ATM card have been
undertaken throughout the globe due to the increasing scale of use of ATM cards and consequent
conversion of the economy into a cashless one.
In the twenty-first century, ATM cards have become one of the most popular non-cash
instruments in the United States and popularity has been explosively growing around the world.
As Stuart E. Weiner (1999) pointed out:
The total number of ATM transactions has more than doubled over the last ten
years and is estimated to reach near 11 billion again this year. And although
there are signs that ATM volume may be peaking, ATM access continues to grow.
The total number of ATM terminals has tripled over the last ten years.
Robert E. Litan (1999) described the introduction and rapid use of ATM as the most visible
revolutions in banking sector. He also supported his claim by stating:
, ATMs offer consumers the convenience of banking in many more locations
than ever before. Indeed, ATMs far outnumber brick-and-mortar banks, in large
part because they are cheaper to operate than a bank branch. Today, nearly
200,000, ATMs are found throughout the country, more than the collective
number of branches of banks, thrifts, and credit unions (approximately 83,000).
In another article James J. Mcandrews (2003) talked about various utilities of ATM because of
which it has become so popular worldwide. The utilities include withdrawal of cash at more
convenient times and places than during banking hours at branches, reduction of cost servicing
etc.
The above mentioned articles talked about the various aspects of ATM mainly from the
customers viewpoint. But Maria Gloria Cobas et al.(2001) have generalized some of the driving
forces behind banks decisions to install ATMs in the United States. According to the authors:
...in the early 1970s, when rising inflation and interest rates made it more
difficult for consumers to borrow, reduced consumers loyalty to their local
banks. These changes in economic conditions and consumer attitudes stimulated
competition among financial institutions. For banks that could afford the
investment, ATMs represented an attractive strategy through which to
distinguish themselves and achieve a competitive market advantage.....In the
second half of the 1970s, more institutions began to install ATMs to enhance
customer service and as a defensive measure against competition from other
banks. Cost savings to banks were not a driving factor. Consumers used ATMs to
access their accounts more frequently, so that the overall number of transactions
increased..... In the 1980s, other factors began to influence ATM installations.
Because construction and operation of brick and mortar branches became
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increasingly expensive, some banks limited branch expansion or closed branches.
ATMs provided a partial substitute for those lost branches.
Cash dispensing is still thought to be the killer-app of ATMs. Large numbers of customers still
rely on ATMs for cash, but few constantly use them for other services (Cobas et al.2001).
Professor Norman Penney claims the development of ATM services occurred for three reasons.
First, financial institutions hoped to improve their competitive positions by attracting customer
accounts and . . . increase their revenues by increasing loans, creating higher balances, and
enhancing their financial services packages. Second, ATMs were designed to perform many of
the same tasks as a human teller at a lower cost. Finally, Professor Penney notes that some
financial institutions made ATM decisions based on marketing considerations. For example,
before building a new branch, one financial institution in Florida used its ATM to test whether the
location would support a branch office. Financial institutions have also used ATMs to encourage
the direct deposit of payroll (Pidgeon, 2000).
In Bangladesh, a broad spectrum of electronic banking services is available with different degree
of penetration. Credit card service is provided by 23.1% of banks (PCBs and FCBs). Among other
electronic banking services tele-banking (19.2%), electronic fund transfer (15.4%), and ATM
(15.4%). ATM is gradually becoming popular in major cities. Some foreign banks provide
electronic fund transfer services. A group of local banks have introduced shared ATM network,
which has increased availability of this type of electronic banking service. The network will
gradually be extended to other parts of the country (Raihan et al, 2001).
There are huge potential cost savings if the banks manage to carry out a higher percentage of their
transactions over the internet and other channels such as ATM (Raihan, 1998).
Though various articles have been published in various articles in Bangladesh regarding
electronic banking, computerization, innovation in banking sector etc but no separate study has
been undertaken regarding customer satisfaction of ATM service. Though, the banks who are
issuing ATM cards provide brochure to make the users understand what ATM is, how to use the
service, the cost of service etc, but they rarely have information regarding the level of customer
satisfaction with respects to various aspects of ATM use.
6.0 Survey Findings
This section deals with the survey findings related with the questions that demanded the ATM
users perception about the levels of satisfaction with respect to various issues.
The survey findings with respect to the level of customer satisfaction with various aspects can be
shown in the following table:
Table 3: Level of Customer Satisfaction with various aspects
Average level of satisfaction Items
Nonstaff users Staff users
Promptness of card delivery 3.54 3.88
The performance of ATM 3.12 4.00
The service quality of ATM personnel 4.05 4.17
The quality of notes (currency) 3.05 3.31
Relative Position of HSBC ATM 3.24 3.31
The above table indicates that both the nonstaff as well as staff ATM users are at more than
neutral state of satisfaction (the neutral state of satisfaction is denoted by 3) with respect to
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various aspects of ATM. But the staff users are more satisfied in all respects than the nonstaff
ATM users. Both types of ATM users are satisfied (denoted by 4) in respect of the service quality
of ATM personnel. In addition to this, staff ATM users are somewhat satisfied with respect to the
performance of HSBC ATM.
6.1 Knowledge about the features of HSBC ATM and use of the features:
The ATM users (selected on the basis of convenience) were requested to answer whether they
know all the features of HSBC ATM and whether they ever use the facilities other than cash
withdrawal. The results are given below:
Table 4: Nonstaff ATM users knowledge about the features of ATM
Knowledge about the
features
Number
of users
Percentage
(%)
Use of features by knowledgeable persons
other than cash withdrawal
Yes 37 65
No 20 35
Total 57 100
Yes 32 (86 %)
No 5 (14 %)
Table 5: Staff ATM users knowledge about the features of ATM
Knowledge about the
features
Number
of users
Percentage
(%)
Use of features by knowledgeable
persons other than cash withdrawal
Yes 34 81
No 8 19
Total 42 100
Yes 32 (94 %)
No 2 (6 %)
The above tables show that about 65% of nonstaff and 81% staff respondents know about the
various features of HSBC ATM. Out of 65% nonstaff respondents, 86% use the facilities other
than cash withdrawal (32). But about 35% of the respondents do not know all the features of the
HSBC ATM. The % is a material one. Out of 81% staff respondents, 94% use the facilities other
than cash withdrawal. Only 19% of the respondents do not know all the features of the HSBC
ATM. Though this percentage is not a material one, but it is not a good signal that even the HSBC
staffs dont know the features of ATM.
6.2 Comment on the positive features of HSBC ATM
Table 6: Customers comment on positive features
Nonstaff customers Staff customers Features
Number Percentage (%) Number Percentage (%)
Cash withdrawal 57 100.00 42 100
Service quality of ATM personnel 43 75.44 34 81
Off-shore ATM 38 66.67 32 76
Time savings 36 63.16 30 71
Easy to use 35 61.40 30 71
Prompt card delivery 33 57.89 32 76
24 hour service in 365 days 33 57.89 25 60
Account activity enquiry 22 38.60 24 57
Statement request 21 36.84 20 48
Safety-security 20 35.09 18 43
Transfer 19 33.33 20 48
Deposit/Mail deposit 19 33.33 18 43
PIN change 18 31.58 18 43
Good decoration & tidiness 18 31.58 18 43
Enquiry 13 22.81 15 36
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So the customers consider the cash withdrawal, service quality of ATM personnel, offshore
ATMs, time savings, easiness in use, prompt card delivery as the positive features of HSBC
ATMs. But the customers are not well aware of the positive features such as account activity
enquiry, statement request, transfer, mail deposit, pin change, enquiry etc.
6.3 Comment on the uncomfortable features/issues of HSBC ATM:
Table 7: Customers comment on uncomfortable features of HSBC ATM
Nonstaff Staff Uncomfortable features
Number Percentage (%) Number Percentage (%)
Machine breakdown 37 64.91 16 38
Unsuitable location 30 52.63 13 31
Poor money quality 26 45.61 23 55
Unsecured 25 43.86 4 10
Machine complexity 22 38.60 7 17
Delay in card delivery 18 31.58 8 19
Card locking 7 12.28 7 17
Poor service quality 5 8.77 - -
More denominator of currency 3 5.26 - -
Old fashioned & untidy 1 1.75 2 5
The nonstaff ATM users feel that the HSBC ATM suffers from a number of uncomfortable
features such as Machine breakdown, Unsuitable location i.e. insufficient number of ATMs; Poor
money quality, Security problem particularly in Banani ATM. According to the staff (selected on
the basis of convenience) poor money quality, machine breakdown, unsuitable location, delays in
card delivery are the main problems of HSBC ATM.
6.4 Recommendation made by customers:
Table 8: ATM users recommendations
Nonstaff Staff Recommendation
Number Percentage (%) Number Percentage (%)
New ATM locations 42 61.40 30 71
Better quality currency 26 45.60 23 55
Increase of safety security 25 43.86 4 10
More user friendly machine 22 38.60 7 17
Increase in number of ATM 20 35.09 15 36
Prompt card delivery 20 35.09 8 20
Better customer service 5 8.77 - -
Facility to pay utility 5 8.77 5 12
More withdrawal limit 3 5.26 - -
More denominator 3 5.26 - -
Making more attractive-
decorations
1 1.75 1 2
In order to improve the service quality of HSBC ATM, the nonstaff as well as staff ATM users
made different types of recommendation. The recommendations include increase in the number of
ATM locations, better customer quality, increase of safety security, more user friendly machine,
increase in number of ATMs, prompt card delivery etc.
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The preference for new location:
According to the nonstaff customers the following are the most important locations where HSBC
can set up new ATM booth:
Table 9: Nonstaff customers preference for new location
Location Response Percentage (%)
Mirpur 30 52.63
Mohammadpur 28 49.12
Mohakhali 25 43.86
The other locations include Farmgate (10), and Jatrabari (5).
Among the different new locations selected by the staffs, the following are noteworthy:
Table 10: Staff customers preference for new location
Location Response Percentage (%)
Mirpur 30 71.00
Newmarket 20 48.00
Mohammadpur 18 43.00
Rampura 10 24.00
The other locations include Shaymoli, Mohakhali, Shahbag etc.
6.5 Comment on additional facilities by customers:
Here the respondents were requested to comment on whether they want any further facilities other
than ATM such as debit card, credit card etc. The responses are given in the following table:
Table 11: ATM users comment on additional facilities
So the customers want some more facility such as credit card facility to be used in HSBC ATM.
7.0 Summary of Findings
The survey findings can be summarized in the following manner:
1. The staff and nonstaff HSBC ATM users (selected on the basis of convenience) are more
than neutral state in respect of all the criteria selected to determine the level of
satisfaction.
2. The average satisfaction level of staff ATM users is more than that of nonstaff ATM users
in all respects. And the difference is material in case of their opinion regarding the
performance of HSBC ATM. The reasons can be explained below:
Use of Branch ATM:
The staffs use the facilities of branch ATM more than the off-site ATMs. The reason
is obvious. They work in a particular branch. After the end of the day, or at a time of
need if they are at the office, they use the branch ATM facilities. The branch ATM
Nonstaff Staff Facilities
Number Percentage (%) Number Percentage (%)
Debit card 10 17.55 - -
Credit card 30 52.63 30 72.00
Both 12 21.05 12 28.00
None 5 8.77 - -
Total 57 100.00 42 100.00
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facilities are generally better than the booth ATM facilities. Because whenever the
branch ATM facilities are out of order or some sort of problem arises with respect to
branch ATM, the branch staffs can take quick action to bring the facility in order or to
solve the problem. But in case of off-site ATM, the HSBC uses the services of
Group 4 Falck which on behalf of HSBC, conducts the appropriate maintenance
functions such as currency refilling, deposit collection, currency sorting, maintenance
etc. So whenever a particular off-site ATM goes out of order for any reason, the
authorized personnel of Group 4 Falck go to the problem area and conduct the
repair & maintenance. But the communication consumes much time, for example, if
the Group 4 Falck members are at Dhanmondi CSC, and problem arises in Uttara
CSC , it takes time for them to reach Uttara. So during the time the customers have to
wait for their arrival or move to other ATM booth. But the staffs face this type of
problem rarely as they use branch service more.
Psychological reason:
The staff respondents hold good impression about their organization. So whenever
they were requested to comment on their satisfaction levels in various aspects of
ATM, they generally provided positive responses which are consistent with their
mental setup.
3. The main problem areas of HSBC ATMs are listed below:
Machine breakdown:
About 65% nonstaff and 38% staff ATM users feel that machine breakdown is the
main problem of HSBC ATM. Machine breakdown generally occurs for the
following reasons:
Poor quality notes: If the notes supplied in the ATMs are of poor quality, the chance
of machine breakdown increases. Because the sensor that picks the notes from the
cassette cant operate smoothly.
High frequency of use: As the number of ATMs of HSBC is less than that required,
the frequency of use of ATM is very high. As ATM is a machine, the probability of
going out of order rises with the high frequency of use of machine.
Unsuitable location:
About 53% customers and 31% staff ATM users feel that the location of HSBC ATM
is unsuitable for the users. It means that the numbers of HSBC ATMs are so limited
that the users have to face difficulty to get its service.
Poor Currency Quality:
About 55% staff and 46% customers believe that poor currency quality is a great
problem of HSBC ATM. In respect of quality of notes, the mean satisfaction level is
the lowest for both staff as well as nonstaff customers. The customers average
satisfaction level is 3.05 and that of staffs is 3.31. This lowest satisfaction level
indicates that the notes supplied at various ATMs are not of good quality. As a result,
the customers receive poor quality notes such as old notes, torn notes etc.
Unsecured:
About 46% customers and 10% staff believe that the security system of HSBC ATM
is not sufficient. By the term unsecured the customers mean that there exists
security problem for them outside the ATM booths. It has found that from outside,
any person can see through the glass of HSBC ATM what the customers are doing
inside the booth.
- 12 -
Machine complexity:
About 38% nonstaff and 17% staff ATM users believe that the ATM machines are
complex i.e. they are not easy to use. Customers generally put this argument when
their cards are retained by the ATM machine. Cards may be retained for many
reasons but ultimately the blame goes to the machine. Another reason can be that
people in Bangladesh still get frightened while using any types of machine that deals
with money.
Delay in card delivery:
About 32% nonstaff customers and 19% staff believe that the HSBC ATM center is
not efficient in making quick delivery of cards. Delay in card delivery generally
occurs because HSBC Bangladesh does not own any ATM card embossing machine
nor it uses the facilities of any institution in Bangladesh. The HSBC ATM cards come
from Hong Kong. So it takes time in making delivery. Moreover, HSBC ATM center
uses the facilities of Sonar Courier, a private courier service-provider, to make
delivery of cards which are to be delivered to the specific address of customers. Sonar
Courier personnel sometimes fail to make delivery to the address because of the
following reasons:
Wrong address of customers;
Incomplete address of customers;
Fictitious address of customers; and
Address which is outside the serving area of Sonar Courier.
If such problem arises, Sonar Courier returns the cards back to the ATM center which
then sends the cards to the respective branch where the customers opened the account.
All these take time and delay in card delivery occurs.
4. Though HSBC ATM has many positive features such as account activity enquiry,
mail/cheque deposit, statement request, PIN change, transfer, enquiry etc., the nonstaff
ATM users and a material percentage of staff ATM users are not well aware of these. As
a result for facilities other than cash withdrawal and cash deposit, they normally have to
depend on the branch services.
5. With respect to service quality of ATM personnel, both the nonstaff and staff users are
satisfied. The average level of satisfaction is 4.05 for nonstaff customers and 4.17 for staff
ATM users. It means that the ATM personnel have performed extremely well in serving
the customers for their various needs.
6. Other than ATM cards, customers also want credit cards, and debit cards. Recently,
Standard Chartered has introduced debit card in addition to ATM card facility. The
customers of HSBC feel the need of credit and debit card facilities. About 53% of
nonstaff and 72% of staff ATM users demand the facilities of credit card to be
incorporated in the ATM card. At present, HSBC offers debit as well credit cards but it
has not yet allowed these cards to be used in ATMs. Customers want the restriction to be
relaxed.
The customers of HSBC ATM have made different recommendations for the improvement of
service quality of HSBC ATM which have policy implications. The most important
recommendations and their policy implications are as follows:
New ATM locations:
At present, numbers of ATM location are not sufficient to meet the needs of growing number
of ATM users, new ATM location is a crying need. About 62% of nonstaff and 71% of staff
ATM users (selected on the basis of convenience) have suggested the need for new ATM
locations.Customers have also suggested the locations of new ATMs such as Mirpur,
- 13 -
Mohammadpur, New market, Mohakhali etc. So the top management should consider the
growing demand of new ATM locations. But they should consider the costs and benefits of
such decision.
Better quality currency:
Better quality currency is another important recommendation of customers. About 46% of
nonstaff and 55% of staff customers of HSBC ATM think that the currency quality should be
improved. It can be done by supplying new notes to the ATM. The HSBC should make
sufficient arrangement so that they can receive better quality notes from Bangladesh Bank.
Increase in number of ATMs:
The present ATMs are located in various busy places. Customers have to wait in line to get
facility of these ATMs. It consumes their valuable time. So about 36% of customers have
urged for the increase in number of ATMs in an existing booth.
Management might consider increasing the number of ATMs. But here they should also
consider the liquidity issue. New ATMs will mean that more liquid money more be needed
and if the demand is not enough, the organization will face the problems arising out of excess
liquidity. So management should consider the issues while making the decision.
More user friendly machine:
About 39% customers (nonstaff) and 17% of staff customers think that the ATMs should be
more user friendly. User friendliness can be improved by increasing awareness of how ATMs
can be used. Another option may be redesigning the software used in ATMs.
Increase of safety security:
About 44% of nonstaff ATM users believe that the safety and security measures should be
improved inside and outside ATMs. This can be done by
Use of nontransparent glass so that people outside the ATM booth cant see what
is happening inside the ATM.
More security measures outside the ATM booth through requesting the
appropriate law-enforcing agencies.
Providing licensed arms to the security persons of ATM.
Prompt card delivery:
About 35% nonstaff and 20% staff ATM users think that there should be quicker delivery
of ATM cards to the customers. This can be done by one of the following two ways:
Importing embossing machine: At present HSBC Bangladesh does not own any
embossing machine and does not use the embossing facility of any organization
because of poor quality. But HSBC Bangladesh has to bear the procurement
charges, courier charges of new ATM cards, etc. So it can think of importing the
embossing machine to Bangladesh which will facilitate prompt card delivery,
savings of courier charges, new employment generation (social responsibility)
etc.
HSBC Bangladesh should consider the costs of new embossing machine as well
the potential benefits while making such decisions.
Motivating the customers to provide exact address to which the ATM cards
will be posted and in case of change of address, communicating the address
change to the appropriate authority.
Motivating the courier authority to increase their service area so that no card
is returned back due to nonavailabilty of service.
- 14 -
8.0 Scope of Future Research
Further studies can be undertaken in this area. For instance, Quality Function Deployment (QFD)
technique may be used to find ways to improve customer satisfaction of ATM service. QFD
concentrates on maximizing customer satisfaction (positive quality) by seeking out both spoken
and unspoken needs, translating these into actions and designs, and communicating these
throughout the organization end-to-end. Further QFD allows customers to prioritize their
requirements, benchmark against competitors, and then direct to optimize those aspects of
product, process, and organization that will bring the greatest competitive advantage
(www.qfdi.org). so customers requirements and their relationships with design characteristics are
the driving forces of QFD methodology (Govers 2001). Again, in this study, convenience
sampling technique has been used. The use of this sampling is subject to error. So further research
can be undertaken using the random sampling technique to make the sample more representative
of the total population.
9.0 Concluding Remark
From the above analyses, it is evident that HSBC ATM has many positive features but the
customers selected on the basis of convenience are not well aware of all these. These customers
are also facing different types of problems with which ATM is directly related. Machine
complexity, machine breakdown, poor quality notes etc. are the major problems identified by the
ATM users. Some inconvenient features are not directly related to HSBC ATM such as safety-
security, decoration etc. Staff and nonstaff ATM users have different levels of satisfaction with
various aspects of HSBC ATM. The most important thing is that at every aspect, the selected
customers have more than neutral state of satisfaction. Though this study cant provide conclusive
evidence to determine particular courses of action and further research will be required to provide
conclusive evidence. But the management of HSBC should consider the findings and take all
necessary steps for further research and if they think that the customers of HSBC ATMs are
homogeneous in their choice and preferences, They may follow the recommendations made by
the customers such as increase of number of ATM locations, new ATMs, better currency quality,
increase of safety-security, introduction of credit card, debit card etc. to gain more customer base
and achieve more customer satisfaction.
References
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- 17 -
Appendix
Use of ATM and the level of satisfaction
Location: .
Point 1 2 3 4 5
Level of
satisfaction
Very
Unsatisfied
Unsatisfied Neutral Satisfied Very
satisfied
Questionnaire
Please put tick () /comment on the following as appropriate:
1. Level of satisfaction with
v The promptness of card delivery:
v The performance of HSBC ATM
v The service quality of ATM personnel
(Query response, timely action on request etc)
v The quality of notes (currency)
2. Do you know all the features of HSBC ATM?
3. If yes, have you tried ever to use the facilities
other than cash withdrawal?
4. If no, what is the reason behind your reluctance?
q It is cumbersome
q I dont like it
q Branch service is better
q It cant provide me required information
q It is time consuming
q Any other-please specify

1 2 3 4 5
1 2 3 4 5
1 2 3 4 5
1 2 3 4 5
YES NO
YES NO
- 18 -
5. What are the positive features of ATM service of HSBC
q Prompt card delivery
q Easy to use
q Satisfied with the service quality of ATM personnel
q Time savings
q 24 hour service in 365 days
q Off-shore ATM
q Cash withdrawal
q Account activity enquiry
q Transfer
q Deposit/Mail deposit
q Statement request
q PIN change
q Enquiry
q Safety-security
q Good decoration & tidiness
q Any other-please specify

6. What are the uncomfortable features/issues of HSBC ATM?


q Poor money quality
q Card locking
q Delay in card delivery
q Machine complexity
q Machine breakdown
q Unsuitable location
q Unsecured
q Old fashioned & untidy
q Any other please specify

7. What are your recommendations to improve HSBC ATM services?


More user friendly machine
Better customer service
Prompt card delivery
New ATM locations
Increase in number of ATM ( which location)
More withdrawal limit
- 19 -
Facility to pay utility
Increase of safety security
Better currency quality
Making more attractive-decorations
Any other- please specify

8. Other than ATM, do you want


Debit card
Credit card
Both
None
Any other-please specify

9. Do you use the ATM service of any other bank?


10. If yes, how can you compare the ATM service
of HSBC with the same of any other bank in
Bangladesh?
Thank you very much for your time, cooperation & patience
*****************************************************
YES NO
Very
poor
Poor Average Good Very
good