REPORT ON CONSUMER PREFERENCE ON CREDIT CARDS SERVICE PROVIDER ICICI

Under the guidance of

MR. DEVANG DESAI

G.I.D.C ROFEL BUSINESS SCHOOL, VAPI

SUBMITED TO:MR. DEWANG DESAI

SUBMITED BY:RAJEEV JHA

CERTIFICATE
This is to certify that RAJEEV KUMAR JHA have satisfactorily completed the project work entitled, Report on consumer preference on credit cards services in India. Based on the declaration made by the candidate and my association as a guide for carrying out this work, we recommend this project report as a part of the PGDM program.

Place: VAPI Date: 10-APRIL-20102

____________________ ____________________ Mr. Devang Desai (Faculty) Dr. KEDAR SUKLA (Director)

TABLE OF CONTENTS: Sr No. PARTICULARS 1. 2. 3. 4. 5. EXECUTIVE SUMMARY ACKNOWLEDGEMENT OBJECTIVES OF THE STUDY INTRODUCTION OF CREDIT CARDS INTRODUCTION OF BANKS RESEARCH METHODOLOGY 6. 7. DATA ANALYSIS & INTERPRETATION CONCLUSION PAGE No. 5 6 7 8-10 11-13 14-15 16-31 32

EXECUTIVE SUMMARY
We are in the era of purchasing through credit cards. 'Payment Cards in India' is a guide to one of Asia's key growth payment card markets. The report provides statistics on market size, competitor market shares and forecasts. It also provides an overview of regulations, competitor activities, issuer strategy, product innovation, consumer segmentation and includes developments in contactless, mobile, and online payments as well as prepaid cards. In this report we have tried to analyze the present scenario of Indian credit cards sector the real aim of the project is to study on the consumer preferences on credit card service provider , but many sub objectives are also included under this project so as to make it comprehensive one. We complement this with the internal study of the companies business areas to analyze how well poised the banks are to complete or rather just exist in this market that is proving itself to be the most competitive in post liberalization Indian economy. Primary data was collected through the customer survey questionnaire with a sample size of 100 respondents. This survey was conducted in VAPI, GUJARAT. Data thus collected analyzed and reported.

ACKNOWLEDGEMENT

We sincerely thankful to all those people who have been giving me any kind of assistance in the making of this project report. We express our gratitude to Mr. Devang Desai, who has through his vast experience and generous support, constant direction and mentoring at all stages of project and able to guide us. We express our gratitude to GRBS ROFEL BUSINESS SCHOOL, VAPI, and GUJARAT. We would hereby, make most of the opportunity by expressing my sincerest thanks to all our faculties whose teachings gave us conceptual understanding and clarity of comprehension, which ultimately made our job easy. Their continuous support has given us the strength and confidence to complete the project without any difficulty. Last of all but not the least we would like to acknowledge my gratitude to the respondents without whom this survey would have been incomplete.

RESEARCH OBJECTIVES
THE MAIN OBJECTIVES OF OUR RESEARCH ARE AS FOLLOWS:
1. to know the perception of people towards credit cards 2. to find out the market leader among the various banks/ companies issuing credit cards 3. to study the satisfaction level of consumers towards credit cards

What is credit card? A card issued by a financial company giving the holder an option to borrow funds, usually at point of sale. Credit cards charge interest and are primarily used for short-term financing. Interest usually begins one month after a purchase is made and borrowing limits are pre-set according to the individual's credit rating. A credit card is a small plastic card issued to users as a system of payment. It allows its holder to buy goods and services based on the holder's promise to pay for these goods and services. The issuer of the card creates a revolving account and grants a line of credit to the consumer (or the user) from which the user can borrow money for payment to a merchant or as a cash advance to the user. HISTORY OF CREDIT CARDS The concept of credit dates back to the late nineteenth century. This is when symbols of credit started being used by merchants while selling goods without the buyer having the necessary cash in hand. In fact, American lawyer and author Edward Bellamy referred to a 'credit card' in his bestselling novel Looking Backward, which was published in 1888. According to Encyclopedia Britannica, credit cards began being used in the US during the 1920s, with oil companies, hotel chains and other individual firms issuing these cards to their customers. In the late 1930s, companies that issued credit cards began accepting cards issued by other firms as payment. The 'Charge-It' card from Flatbush National Bank of New York was the first bank card to be issued in 1946, but it could only be used locally. American Express issued the first national charge card in 1958.
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Today, credit cards can be used globally, can involve a number of third parties, can be used for a wide number of purchases and do not require the cardholder to maintain an account with the issuing entity.

Types of credit card: Premium Credit Cards Cash Back Credit Cards Gold Credit Cards Airline Credit Cards Silver Credit Cards Business Credit Cards Balance Transfer Credit Cards Co-branded Credit Cards Low Interest Credit Cards Lifetime Free Credit Cards Rewards The Rewards credit cards may be subdivided into Points, Hotels/Travels, Retail, Auto and Fuels cards.

Major Credit Card Providers in India

Here are the top major credit card providers in India:

HDFC American Express ICICI Bank Axis Bank SBI Bank of Baroda Canara Bank Citibank Visa HSBC MasterCard Deutsche Bank Amex Barclays Bank Diners Club Standard Chartered Kotak Mahindra CREDIT CARDS PROVIDERS IN VAPI (GUJRAT):-

HDFC ICICI Bank Axis Bank SBI Bank of Baroda Canara Bank IDBI

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HDFC bank

The Housing Development Finance Corporation Limited (HDFC) was amongst the first to receive an 'in principle' approval from the Reserve Bank of India (RBI) to set up a bank in the private sector, as part of the RBI's liberalisation of the Indian Banking Industry in 1994. The bank was incorporated in August 1994 in the name of 'HDFC Bank Limited', with its registered office in Mumbai, India. HDFC Bank commenced operations as a Scheduled Commercial Bank in January 1995.

ICICI bank

Ms. Chanda Kochhar is the Managing Director and Chief Executive Officer of ICICI Bank Limited. She began her career with ICICI as a Management Trainee in 1984 and has thereon successfully risen through the ranks by handling multidimensional assignments and heading all the major functions in the Bank at various points in time. In 1993 when ICICI decided to enter commercial banking, she was deputed to ICICI Bank as a part of the core team to set up the bank. When ICICI set up the Infrastructure Industry Group in 1996 to create dedicated industry expertise in the areas of Power, Telecom and Transportation sector, she was handpicked and made
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incharge of the Infrastructure Industry Group. In July 2000, she was chosen to head the Retail Finance division of ICICI and has been instrumental in scaling up the business. In April 2001, she was promoted as an Executive Director, heading the retail business in the Bank. In April 2006, she was appointed as the Deputy Managing Director with responsibility for both Corporate and Retail banking business of ICICI Bank and from October 2006 to October 2007 she handled the International and Corporate businesses of ICICI. In October 2007, she was appointed as the Joint Managing Director & CFO. She was heading the Corporate Centre, was the Chief Financial Officer (CFO) and was also the official spokesperson for ICICI Bank.

AXIS bank

Axis Bank Limited is an India-based bank. The Bank operates in four segments: treasury operation, which includes investments in sovereign and corporate debt, equity and mutual funds, trading operations, derivative trading and foreign exchange operations on the account, and for customers and central funding; retail banking, which includes lending to individuals/small businesses subject to the orientation, product and granularity criterion, and also includes liability products, card services, Internet banking, automated teller machines (ATM) services, depository, financial advisory services, and nonresident Indian services (NRI); corporate/wholesale banking, which includes corporate relationships not included under retail banking, corporate advisory services, placements and syndication, management of publics issue, project appraisals, capital market related services, and cash management services, and other banking business, which includes para banking activities.

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STATE BANK OF INDIA

State Bank of India is an India-based bank. In addition to banking, the Company, through its subsidiaries, provides a range of financial services, which include life insurance, merchant banking, mutual funds, credit card, factoring, security trading, pension fund management and primary dealership in the money market. It operates in four business segments: the treasury segment includes the entire investment portfolio and trading in foreign exchange contracts and derivative contracts; the corporate / wholesale banking segment comprises the lending activities of corporate accounts group, mid corporate accounts group and stressed assets management group; the retail banking segment comprises of branches in National Banking Group, which primarily includes personal banking activities, and other banking business. As of March 31, 2011, the Bank had a network of 18,266 branches including 4,724 branches of its five Associate Banks.

IDBI bank
IDBI Bank Limited (the Bank) is an India-based commercial bank. The Bank operates in four segments: wholesale banking, retail banking, treasury services and other banking operations, including operations of joint venture and subsidiaries. The Banks products include deposits, loans, net banking, online tax payment, real-time gross settlement / fund transfer, phone banking, mobile banking, debit cards, small and medium enterprises finance and agriculture finance. The services include appraisal, debt syndication, advisory services, environmental services and securitisation and structured product services. As on March 31, 2011, the Bank had a network of 816 branches and 1372 automated teller machine (ATMs).
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RESEARCH METHODOLOGY We as team have used descriptive type of research methodology to find out customer preferences on cellular services provider. Basically to know whose services are best& interesting . Descriptive Research: Descriptive research, also known as statistical research, describes data and characteristics about the population or phenomenon being studied. Descriptive research answers the questions who, what, where, when and how. Although the data description is factual, accurate and systematic, the research cannot describe what caused a situation. Thus, descriptive research cannot be used to create a causal relationship, where one variable affects another. In other words, descriptive research can be said to have a low requirement for internal validity. The description is used for frequencies, averages and other statistical calculations. Often the best approach, prior to writing descriptive research, is to conduct a survey investigation. Qualitative research often has the aim of description and researchers may follow-up with examinations of why the observations exist and what the implications of the findings are. We are using Descriptive Research design to find out the customer preferences on cellular services provider Primary Data Collection: In primary data collection, you collect the data yourself using methods such as interviews and questionnaires. The key point here is that the data you collect is unique to you and your research and, until you publish, no one else has access to it. The primary data, which is generated by the above methods, may be qualitative in nature (usually in the form of words) or quantitative (usually in the form of numbers or where you can make counts of words used). We briefly
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outline these methods but you should also read around the various methods. There are many methods of collecting primary data and the main methods include: Questionnaires Interviews Focus group interviews Observation Case-studies

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DATA ANALYSIS:1. Name the bank of credit card which you are using? HDFC 30 ICICI 20 SBI 15 AXIS 15 IDBI 10 ANY OTHER 10

SERVICES
HDFC ICICI SBI AXIS IDBI ANY OTHER

10% 10% 30%

15%

15%

20%

INTERPRETATION- It is found that majority of the people uses HDFC as their service provider. ICICI obtained second, AXIS and SBI have obtained third ratings as per the consumer survey.

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2. How long have you been using the credit card? <1 20 1-2 25 2-3 25 >3 30

MORE THAN THREE YEARS 30%

LESS THAN ONE YEAR 20%

1-2 YEARS 25% 2-3 YEARS 25%

INTERPRETATION: It is noticed that majority of the customer using services from more than three years that is 30%.

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3. How did you come to know about this bank credit card?

Self mode Bankers approach 10 40

Relatives

Advertisement

20

30

SELF MODE 10%

ADVERTISMENTS 30%

BANKERS APPROACH 40% RELATIVES 20%

INTERPRETATION: It is noticed that majority of the customer come to know about this bank credit card for bankers approach that is 40%, and advertisements.

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4. Do you want to be a credit card holder for life long?

YES 65

NO 35

Chart Title
YES NO

35%

65%

INTERPRETATION: It is noticed that majority of the customer wants to be a credit card holder for life long.

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5. The usage of credit card is more important.

STRONGLY DISAGREE 3

DISAGREE AGREE 7 40

STRONGLY AGREE 50

Series1

50% 40%

3% Strongly disagree

7% disagree agree strongly agree

INTERPRETATION: It is noticed that majority of the customer strongly agrees for credit cards are most important.

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6. Does your bank offers the credit holders an existing range of prizes, special discounts and privileges? STRONGLY DISAGREE 15 DISAGREE AGREE 25 35 STRONGLY AGREE 25

Series1 35%

25%

25%

15%

strongly diagree

disagree

agree

strongly agree

INTERPRETATION: It is noticed that majority of the customer agrees for bank offers the credit holders an existing range of prizes, special discounts and privileges.

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7. Does your bank gives the proper records of the credit card, credit rate calculations that are made? STRONGLY DISAGREE 0 DISAGREE AGREE 3 47 STRONGLY AGREE 50

Series1

47%

50%

0% strongly disagree

3% disagree agree strongly agree

INTERPRETATION: It is noticed that majority of the customer strongly agrees for bank gives the proper records of the credit card, credit rate calculations that are made.

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8. How would you rate your bank credit card? STRONGLY DISAGREE 15 DISAGREE AGREE 15 30 STRONGLY AGREE 40

Series1

40% 30% 15% 15%

strongly disagree

disagree

agree

strongly agree

INTERPRETATION: It is noticed that majority of the customer strongly agrees for rate your bank credit card

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9. Does your bank credit cards are accepted to pay for personal expenses? STRONGLY DISAGREE 7 DISAGREE AGREE 13 40 STRONGLY AGREE 30

45% 40% 35% 30% 25% 20% 15% 10% 5% 0% STRONGLY DISAGREE DISAGREE AGREE STRONGLY AGREE Series1

INTERPRETATION: It is noticed that majority of the customer agrees for credit cards are accepted to pay for personal expenses.

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HYPOTHESIS 1:( Chi-square test) Is there any relation between interest rate and Overall satisfaction? Null Hypothesis:
Ho: There is no relation between interest rate and Overall satisfaction.

Alternative Hypothesis:
H1: There is relation between interest rate and Overall satisfaction.

Level of significance 5% Degree of freedom- 16

Duration highly satisfied Satisfied Neutral Distasified Highly dis satisfied TOTAL H.S 5 3 4 3 2
17 23

S 7 5 5 2 4

N 5 5 5 3 2
20

D.s H.D.S 6 5 5 4 5 2
22 18

TOTAL 28

5 4 2 2

23 22 15

12 100

25

Duration highly satisfied satisfied Neutral distasified Highly dis satified TOTAL
17

H.S 5
4.760

S 7
6.440

N 5
5.600 5.290 5.060 3.450

D.s 6
6.160 4.600 4.400 3.000

H.D.S 5
5.040

TOTAL

28.00 23.00 22.00 15.00

3 4 3 2

3.910 3.740 2.550

5 5 2 4
23

5 5 3 2
20

5 4 5 2
22

5.060 4.840 3.300

5 4 2 2
18

4.140 3.960 2.700

2.040

2.760

2.400

2.640

2.160

12.00 100.00

OBSERVATION EXPECTED
5 7 5 6
3 5 5 5 4 5 5 5

O-E
0.24 0.56 -0.60 -0.16 -0.91 -0.29 0.40 -0.06 0.26 -0.06 0.60 0.16

(OE)2
0.06 0.31 0.36 0.03 0.83 0.08 0.16 0.00 0.07 0.00 0.36 0.03

(OE)2/E
0.01 0.05 0.06 0.00 0.21 0.02 0.03 0.00 0.02 0.00 0.08 0.01

4.76 6.44 5.60 6.16

3.91 5.29 4.60 5.06 3.74 5.06 4.40 4.84

2 4 2 2

2.04 2.76 2.40 2.64

-0.04 1.24 -0.40 -0.64

0.00 1.54 0.16 0.41

0.00 0.56 0.07 0.16 1.28

X2Cal= 1.28 X2tab = 26.30

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So, Null hypothesis is accepted. There is no relation between interest

rate and Overall satisfaction.

HYPOTHESIS 2: Is there any relation between easy to handle and Overall satisfaction? Null Hypothesis:
Ho: There is no relation between Network coverage and Overall satisfaction

Alternative Hypothesis:
H1: There is relation between easy to handle and Overall satisfaction Level of significance-5% Degree of freedom-16
Duration highly satisfied Satisfied Neutral Distasified Highly dis satisfied TOTAL H.S 2 4 5 3 3
17 21

S 3 2 6 5 5

N 2 5 5 2 5
19

D.s H.D.S 5 3 2 6 5 5
23 20

TOTAL 15

2 5 5 5

15 27 20

23 100

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Duration highly satisfied satisfied Neutral distasified Highly dis satified TOTAL
17

H.S 2
2.550

S 3
3.150

N 2
2.850 3.150 5.670 4.200

D.s 5
3.450 2.850 5.130 3.800

H.D.S 3
3.000

TOTAL

15.00 15.00 27.00 20.00

4 5 3 3

2.550 4.590 3.400

2 6 5 5
21

5 5 2 5
19

2 6 5 5
23

3.450 6.210 4.600

2 5 5 5
20

3.000 5.400 4.000

3.910

4.830

4.370

5.290

4.600

23.00 100.00

OBSERVATION EXPECTED
2 3 2 5
4 2 5 2 5 6 5 2

O-E
-0.55 -0.15 -0.85 1.55 1.45 -1.15 2.15 -1.45 0.41 0.33 -0.13 -4.21

(OE)2
0.30 0.02 0.72 2.40 2.10 1.32 4.62 2.10 0.17 0.11 0.02 17.72

(OE)2/E
0.12 0.01 0.25 0.70 0.82 0.42 1.62 0.61 0.04 0.02 0.00 2.85

2.55 3.15 2.85 3.45

2.55 3.15 2.85 3.45 4.59 5.67 5.13 6.21

3 5 5 5

3.91 4.83 4.37 5.29

-0.91 0.17 0.63 -0.29

0.83 0.03 0.40 0.08

0.21 0.01 0.09 0.02 7.79

X2Cal= 7.79 X2tab = 26.30

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So, Null hypothesis is accepted. There is no relation between easy to

handle and Overall satisfaction.

HYPOTHESIS 3: Is there any relation between more security and Overall Satisfaction? Null Hypothesis:
Ho: There is no relation between local call service and overall satisfaction

Alternative Hypothesis:
H1: There is relation between more security and overall satisfaction. Level of significance- 5% Degree of freedom-16

Duration highly satisfied Satisfied Neutral Distasified Highly dis satisfied TOTAL

H.S 5 4 3 2 3
17

S 6 5 5 3 2
21

N 5 5 5 2 5
22

D.s H.D.S 5 5 5 5 6 2
23 17

TOTAL 26

2 5 3 2

21 23 16

14 100

29

Duration highly satisfied satisfied Neutral distasified Highly dis satified TOTAL
17

H.S 5
4.420

S 6
5.460

N 5
5.720 4.410 4.830 3.360

D.s 5
5.980 4.620 5.060 3.520

H.D.S 5
4.420

TOTAL

26.00 21.00 23.00 16.00

4 3 2 3

3.570 3.910 2.720

5 5 3 2
21

5 5 2 5
22

5 5 6 2
23

4.830 5.290 3.680

2 5 3 2
17

3.570 3.910 2.720

2.380

2.940

3.080

3.220

2.380

14.00 100.00

OBSERVATION EXPECTED
5 6 5 5
4 5 5 5 3 5 5 5

O-E
0.58 0.54 -0.72 -0.98 0.43 0.59 0.38 0.17 -0.91 0.17 -0.06 -0.29

(OE)2
0.34 0.29 0.52 0.96 0.18 0.35 0.14 0.03 0.83 0.03 0.00 0.08

(OE)2/E
0.08 0.05 0.09 0.16 0.05 0.08 0.03 0.01 0.21 0.01 0.00 0.02

4.42 5.46 5.72 5.98

3.57 4.41 4.62 4.83 3.91 4.83 5.06 5.29

3 2 5 2

2.38 2.94 3.08 3.22

0.62 -0.94 1.92 -1.22

0.38 0.88 3.69 1.49

0.16 0.30 1.20 0.46 2.90

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X2Cal= 2.90 X2tab = 26.30

So, Null hypothesis is accepted. There is no relation between more

security and Overall satisfaction.

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CONCLUSION: The final conclusion of the study is that hdfc bank credit card are very much satisfied by the services which HDFC bank provides. ICICI and SBI have earned the second and third position respectively. According to survey the customers of ICICI and SBI is also satisfied and on good position.

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