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International Journal of Management (IJM)
Volume 7, Issue 6, September–October 2016, pp.77–88, Article ID: IJM_07_06_009
Available online at
http://www.iaeme.com/ijm/issues.asp?JType=IJM&VType=7&IType=6
Journal Impact Factor (2016): 8.1920 (Calculated by GISI) www.jifactor.com
ISSN Print: 0976-6502 and ISSN Online: 0976-6510
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CUSTOMER’S PERCEPTION AND SATISFACTION
TOWARDS SERVICES OF PUBLIC & PRIVATE
SECTOR BANKS
Kesari Singh and Nitin Gupta
School of Business Management & Liberal Arts,
Shoolini University of Biotechnology & Management Sciences, Solan, H.P. INDIA.
ABSTRACT
Indian Banking has gone tremendous changes over time and the entry of private sector banks has
transformed the Indian banking both structurally and functionally. In this competitive banking
environment, customer satisfaction is considered as most imperative factor for the success of banks.
To attain the high level of customer satisfaction and to retain the customer base, it is important for
the banks to deliver quality services to its customers. Hence, the study analyzed relative customer
satisfaction levels of private and public sector banks. The issue is of importance to address the often
raised concerns of differences in working and quality of services provided by public and private
sector banks. A sample of 900 customers from the three northern region states viz. Punjab, Haryana
and Himachal Pradesh was selected for the primary survey. Well-structured questionnaire was used
to collect data. Customer perception and satisfaction was studied through various parameters viz.
effectiveness, accessibility, cost, tangibles, reliability and empathy. Association between these
indicators with the socio-economic variables viz. age, gender, occupation, annual income and area
was studied through chi-square test. Public sector banks were more cost effective whereas, private
sector did better in terms of tangibles. Private sector banks were comparatively more reliable due to
proficiency in service delivery.
Key words: customer satisfaction, private sector banks, public sector banks, service quality.
Cite this Article: Kesari Singh and Nitin Gupta, Customer’s Perception and Satisfaction towards
Services of Public & Private Sector Banks. International Journal of Management, 7(6), 2016, pp.
77–88.
http://www.iaeme.com/IJM/issues.asp?JType=IJM&VType=7&IType=6
1. INTRODUCTION
Indian Banking has gone through enormous changes since independence. Introduction of new technologies,
economic uncertainties, fierce competition and changing demand of customers created a competitive
scenario for banks. In today’s fast moving life and highly competitive environment, the banking sector has
to understand and analyze the customer’s perception and requirements for service quality. To attain the high
level of customer satisfaction and to retain the customer base, it is important for the banks to deliver quality
services to its customers. The term service quality can be termed as a significant determinant of
competitiveness for establishing the sustainable and satisfying relationships with customers. Persuraman