Services

[iyervijay]

Hi all,

This is the first gutfeel I am posting. I often wonder about the service industry in India....thinking about whether it for real? I will in this article restrict my comments on the Banking industry. I am working as a Senior Manager in a MNC Bank in credit. I have seen this service industry evolving in the past decade. Yes the things have changed in the past decade in the banking industry, but is upto the satisfaction of the customers. The most important question arises in my mind: Is anybody paying for the enhanced services?

About a 15 years back when everyone of us were used to the traditional banks with their bereaucatic practices, where nobody was aware of an ATM machine, had not heard of a debit card or a credit card, internet banking or a phone banking. When the nationalised banks reached the pinnacle of inefficiency which could not cater to the growing needs of the corporates and individuals which was impeding the economic growth of India, there was silent revolution happening in India, where financial institutions like HDFC, ICICI and UTI were eyeing to accomodate the vacuum created between the needs of the customers and the incapability of the nationalised banks to fulfill their needs. Now the scenario, as everyone knows, the nationalised banks are doing everything to woo the customers from the new generation private sector banks and even some foreign banks.

The next thing which comes to my mind is, whether the new generation banks are able to satisfy to most of the customers. The phrase of some of the customers have been choosen by me because I believe that Service Industry is a "Thankless Industry", where it is impossible to satisfy every need of all the customers. No doubt these banks have invested chunks of money to cater the needs of the customers, but how are recovering the investments. No prizes for guessing...obviously from the customers. I think that is fair and just because every business has a motive of profit making. I am not trying to be overcritical about the age old nationalised banks nor I am going "ga-ga" over the new generation banks. The ethics of nationalised banks are very socialistic as compared to the new banks. Thus my conclusion is: if the customers want to get better services, pay for it else be happy with the traditional banking.

What is your gut feel???


Cheers
Vijay

[Aditi77_k]

I agree to what u are saying that the services offered by the private banks are in keeping with the world-wide trend. They are focusing on the customer and r taking care of his needs. And the customers are also lapping up the services. They are ready to pay more. I can only say that if the nationalised banks want to keep up with the competition, they have to come up with more customer freindly ideas. What do u say?

[iyervijay]

I agree that nationalised banks needs to up the standard. But I really wonder whether they will be able to recover the additional costs in upgrading from the customers. I do agree that the customers will be ready to pay, but not all. There are millions of people in India who cannot afford to pay more.

I thus foresee that the new generation banks will cater to the higher middle class and High Networth individuals whereas the nationalised banks will have to cater to the middle class and lower class of people. This will be "Win-Win" situation for everyone: lower class customers will benefit from the lower costs at the cost of poor services, nationalised banks will benefit from captive customers and can also relish their bereaucracy, Upper middle class customers will be benefit by better services by paying a certain premium and the new generation banks will be benefit by additional costs (hidden sometimes).

Any comments?


Regards
Vijay

[anshulseth]

I feel tht as far the issue goes, banking has become a high growth and a high revenue generating industry. With more user-friendly ideas, easy and fast access to money, 24*7 services, it is the customers who are winning and making use of it. But as evrything comes at a cost, users have to pay for it and banks are raking in the moolah.

But the grass is not all green.With large realm of services, banks have to get large workforce and centers to cater to these increasing members. This has resulted in inefficiency, carelessness, and skullduggery.
Lack of information with the bank officials, no maintenance of documents, and various leakages of info which results in middlemen coming in has brought disrepute to the industry. And this includes big names in the banking industry.

It has been my personal experience, with me losing a large money as my account had not enough money. My discomfort was that i was never intimated or warned in advance about it, and only got the info of the money being deducted from my account.

Also, in case of credit cards, i have to deal with many impostors who got away with my personal info n could never be traced. In fact it so happened that evry second person i called up in the bank rejected the identity of the first one. It was ridiculous to say the least.
Also, the call centre ppl had no consistency with different ppl saying diff versions on the same topic.

So, i feel it has become total chaos with the industry becoming unmanageable. In today's society of high salried ppl, nobody wud have problem to pay for services or comfort, but who will be ready to pay for such shabby and careless services. You dont pay for what u dont get, n if this trend continues these new found ideas would die a premature death.

Asset

[navin]

I am not sure if this happens in India or not but in US and other such countries, the price of anything includes the 2.5% the shopkeeper is supposed to pay the bank. Bank charges the shops and the shops charges the people (even if they pay by cash).
In India, most of the banks require you to maintain a minimum balance. The banks are using that money to make money and if the minimum balance is not maintained, the bank charges a service charge. The new banks are not serving all kind people like the nationalised banks of the post offices. You will not find a private bank operating in a remote place. The are operation in hig-density places where they can have a lot of clients so their expenses are less than the nationalised banks.
Keeping this in mind, I'll say the private banks are makin enough money as it is and there is no reason for them to charge any more.

[Neogen]

You pay the price to get better service everywhere.

Though I am not expert on Indian Economy, but I feel that in India Social Security setup need to exist.

Like in US we have Social Security system that helps the people in remote areas. Also there are work done to grow and develop the remote areas.

For this the system need to be transparent, i.e. no corruption.

So what is your gut feel? Do we have transparent system everywhere?

[Editor]