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Customer satisfaction and acceptability of icici credit cards
CHAPTER I
INTRODUCTION
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1.1 EXECUTIVE SYNOPSIS
The Research study deals with the marketing of ICICI credit cards among
various segments of customers and to find out the customer satisfaction and its
acceptability and the needs and expectations of the market. The particular study is
done at Duke Front line Financial Services Private Limited. The Front lines was
started a decade ago and are into the business of marketing financial products of
major banks.
A Credit Card is a mode of cash-less transaction that allows the user to pay for
goods or services with the actual payment being made in installments, over a period
of time. Most of the credit cards in the market belong to either MasterCard or Visa.For principal services to the industry they are typically paid 0.025% of the transaction
by the issuing bank:
This Research study is based on primary data that was obtained by
interviewing the various segments of credit card holders with the help of
questionnaires. It aims at evaluating the acceptability of ICICI credit cards in the
market and what additional services the company should adopt in order to make it
more acceptable
The sample comprised of 100 ICICI credit card holders from various segments
including the Very Rich, Consuming Class and Climbers
The general perception among credit card holders about the services rendered
by the bank was positive and the card is well accepted by the Clients
My conclusion is that the ICICI credit card is widely accepted among the
clients because of the wide range of services and conveniences they offer and the
Brand image of the bank. The bank could enhance its acceptability and make it as the
first choice for customers by offering some value added services and providing
information updates and enough facilities to use its full potential.
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1.2 RESEARCH DESIGN OF THE STUDY
1. NATURE OF DATA
The study is intended to find out the customer satisfaction and acceptability of
ICICI credit cards among the customers of Duke Frontline financial services
private limited. The study is based on the information gained by collecting data
through questionnaire and personal interview.
2. OBJECTIVES OF THE STUDY
1. To find out the customer satisfaction of ICICI credit cards
2. To find out the acceptability of ICICI Credit Cards among the customers3. To identify the needs and expectations of the credit card customers
4. To suggest improvements to make the Credit card more acceptable.
5. To find out the general trends in the credit card market
3. SCOPE OF THE STUDY
The project has a scope for identifying the needs and expectations of the customer
and based on that effecting improvements in order to make it widely acceptable.
4. SAMPLE SIZE
Sample for the study was ICICI credit card holders from various target segments
including Very Rich, Consuming Class and Climbers. The sample size used was
100 and all of them were the clients of Frontline.
5. SOURCES OF DATA
Both primary and secondary data were used. Questionnaires and interviewing were
used for collecting the primary data. Secondary data was collected from published
material and Internet
6. TOOLS USED FOR DATA COLLECTION:
The date was collected by way of questionnaires and interview of the sample. The
sample questionnaire is given in the Annexure.
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7. METHODOLOGY
Type of research : Descriptive.
Tool : Structured questionnaire. Data Collection : Interview with the help of questionnaires.
Method of analysis : Logical
8. LIMITATIONS OF THE STUDY
The respondents to the questionnaire were restricted to the customers of Duke
Frontline financial services private limited only. Was forced to take up a samplesize of 100 and I wasnt able spend more time with the respondents as they were
busy and were not ready to spend more time for my study.
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CHAPTER II
COMPANY PROFILE
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2.1 COMPANY PROFILE
ICICI Bank is India's second-largest bank with total assets of Rs. 3,446.58 billion
(US$ 79 billion) at March 31, 2007 and profit after tax of Rs. 31.10 billion for fiscal
2007. ICICI Bank is the most valuable bank in India in terms of market capitalization
and is ranked third amongst all the companies listed on the Indian stock exchanges in
terms of free float market capitalisation*. The Bank has a network of about 950
branches and 3,300 ATMs in India and presence in 17 countries. ICICI Bank offers a
wide range of banking products and financial services to corporate and retail
customers through a variety of delivery channels and through its specialised
subsidiaries and affiliates in the areas of investment banking, life and non-life
insurance, venture capital and asset management. The Bank currently has subsidiaries
in the United Kingdom, Russia and Canada, branches in Singapore, Bahrain, Hong
Kong, Sri Lanka and Dubai International Finance Centre and representative offices in
the United States, United Arab Emirates, China, South Africa, Bangladesh, Thailand,
Malaysia and Indonesia. Our UK subsidiary has established a branch in Belgium.
ICICI Bank's equity shares are listed in India on Bombay Stock Exchange and the
National Stock Exchange of India Limited and its American Depositary Receipts(ADRs) are listed on the New York Stock Exchange (NYSE).
2.2 HISTORY OF ICICI
ICICI Bank was originally promoted in 1994 by ICICI Limited, an Indian financial
institution, and was its wholly-owned subsidiary. ICICI's shareholding in ICICI Bank
was reduced to 46% through a public offering of shares in India in fiscal 1998, an
equity offering in the form of ADRs listed on the NYSE in fiscal 2000, ICICI Bank's
acquisition of Bank of Madura Limited in an all-stock amalgamation in fiscal 2001,
and secondary market sales by ICICI to institutional investors in fiscal 2001 and fiscal
2002. ICICI was formed in 1955 at the initiative of the World Bank, the Government
of India and representatives of Indian industry. The principal objective was to create a
development financial institution for providing medium-term and long-term project
financing to Indian businesses. In the 1990s, ICICI transformed its business from a
development financial institution offering only project finance to a diversified
financial services group offering a wide variety of products and services, both directly
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and through a number of subsidiaries and affiliates like ICICI Bank. In 1999, ICICI
become the first Indian company and the first bank or financial institution from non-
Japan Asia to be listed on the NYSE.
After consideration of various corporate structuring alternatives in the context of the
emerging competitive scenario in the Indian banking industry, and the move towards
universal banking, the managements of ICICI and ICICI Bank formed the view that
the merger of ICICI with ICICI Bank would be the optimal strategic alternative for
both entities, and would create the optimal legal structure for the ICICI group's
universal banking strategy. The merger would enhance value for ICICI shareholders
through the merged entity's access to low-cost deposits, greater opportunities for
earning fee-based income and the ability to participate in the payments system and
provide transaction-banking services. The merger would enhance value for ICICI
Bank shareholders through a large capital base and scale of operations, seamless
access to ICICI's strong corporate relationships built up over five decades, entry into
new business segments, higher market share in various business segments,
particularly fee-based services, and access to the vast talent pool of ICICI and its
subsidiaries. In October 2001, the Boards of Directors of ICICI and ICICI Bank
approved the merger of ICICI and two of its wholly-owned retail finance subsidiaries,
ICICI Personal Financial Services Limited and ICICI Capital Services Limited, with
ICICI Bank. The merger was approved by shareholders of ICICI and ICICI Bank in
January 2002, by the High Court of Gujarat at Ahmedabad in March 2002, and by the
High Court of Judicature at Mumbai and the Reserve Bank of India in April 2002.
Consequent to the merger, the ICICI group's financing and banking operations, both
wholesale and retail, have been integrated in a single entity.
1955 : The Industrial Credit and Investment Corporation of India Limited (ICICI)
incorporated at the initiative of the World Bank, the Government of India and
representatives of Indian industry, with the objective of creating a development
financial institution for providing medium-term and long-term project financing to
Indian businesses. Mr.A.Ramaswami Mudaliar elected as the first Chairman of ICICI
Limited
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ICICI emerges as the major source of foreign currency loans to Indian industry.
Besides funding from the World Bank and other multi-lateral agencies, ICICI also
among the first Indian companies to raise funds from International markets.
1956 : ICICI declared its first Dividend at 3.5%.
1958 : Mr.G.L.Mehta was appointed the 2nd Chairman of ICICI Ltd.
1960 : ICICI building at 163, Backbay Reclamation was inaugurated.
1961 : The first West German loan of DM 5 million from Kredianstalt was obtained
by ICICI.
1967 : ICICI made its first debenture issue for Rs.6 crore, which was oversubscribed.
1969 : First two regional offices in Calcutta and Madras were opened
1972 : Second entity in India to set-up merchant banking services.
Mr. H. T. Parekh appointed as the third Chairman of ICICI.
1977 : ICICI sponsors the formation of Housing Development Finance Corporation.
Managed its first equity public issue
1978 : Mr. James Raj appointed as the fourth Chairman of ICICI.
1979 : Mr.Siddharth Mehta appointed as the fifth Chairman of ICICI.
1982 : Becomes the first ever Indian borrower to raise European Currency Units.
ICICI commences leasing business.
1984 : Mr. S. Nadkarni appointed as the sixth Chairman of ICICI.
1985 : Mr.N.Vaghul appointed as the seventh Chairman and Managing Director of
ICICI.
1986 : ICICI first Indian Institution to receive ADB Loans. First public issue by an
Indian entity in the Swiss Capital Markets.
:ICICI along with UTI sets up Credit Rating Information Services of India
Limited, (CRISIL) India's first professional credit rating agency.
:ICICI promotes Shipping Credit and Investment Company of India Limited.
(SCICI)
:The Corporation made a public issue of Swiss Franc 75 million in Switzerland,
the first public issue by any Indian equity in the Swiss Capital Market.
1987 : ICICI signed a loan agreement for Sterling Pound 10 million with
Commonwealth Development Corporation (CDC), the first loan by CDC for
financing projects in India
1988 : ICICI promotes TDICI - India's first venture capital company.
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1993 : ICICI sets-up ICICI Securities and Finance Company Limited in joint venture
with J. P. Morgan.
ICICI sets up ICICI Asset Management Company.
1994 : ICICI sets up ICICI Bank.
1996 : ICICI becomes the first company in the Indian financial sector to raise GDR.
ICICI announces merger with SCICI.
Mr.K.V.Kamath appointed the Managing Director and CEO of ICICI Ltd
1997 : ICICI was the first intermediary to move away from single prime rate to three-
tier prime rates structure and introduced yield-curve based pricing.
: The name "The Industrial Credit and Investment
: Corporation of India Limited " was changed to "ICICI Limited".
: ICICI announces takeover of ITC Classic Finance.
1998 : Introduced the new logo symbolizing a common corporate identity for the
ICICI Group.
:ICICI announces takeover of Anagram Finance.
1999 : ICICI launches retail finance - car loans, house loans and loans for consumer
durables.
:ICICI becomes the first Indian Company to list on the NYSE through an issue
of American Depositary Shares.
2000 : ICICI Bank becomes the first commercial bank from India to list its stock on
NYSE.
:ICICI Bank announces merger with Bank of Madura.
2001 : The Boards of ICICI Ltd and ICICI Bank approved the merger of ICICI with
ICICI Bank.
2002 : Moodys' assign higher than sovereign rating to ICICI
: Merger of ICICI Limited, ICICI Capital Sercvices Ltd and ICICI Personal
Financial Services Limited with ICICI Bank
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CHAPTER III
PRODUCT PROFILE
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3.1 CARDS
ICICI Bank offers a variety of cards to suit your different transactional needs. Our range
includes Credit Cards, Debit Cards and Prepaid cards. These cards offer you convenience for
your financial transactions like cash withdrawal, shopping and travel. These cards are widely
accepted both in India and abroad.
Credit Card
Debit Cards
Travel Card
Prepaid Cards
Purchase Card
Distribution Cards
Business Card
ICICI Bank Credit Cards give you the facility of cash, convenience and a
range of benefits, anywhere in the world. These benefits range from life time free cards,
Insurance benefits, global emergency assistance service, discounts, utility payments, travel
discounts and much more.
The ICICI Bank Debit Card is a revolutionary form of cash that allows
customers to access their bank account around the clock, around the world. The ICICI Bank
Debit Card can be used for shopping at more than 3.5 Lakh merchants in India and 24 million
merchants worldwide.
Presenting ICICI Bank Travel Card. The Hassle Free way to Travel the
world. Traveling with US Dollar, Euro, Pound Sterling or Swiss Francs; Looking for security
and convenience; take ICICI Bank Travel Card. Issued in duplicate. Offers the Pin based
security. Has the convenience of usage of Credit or Debit card.
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ICICI Bank brings to you a complete bouquet of pre-paid cards providing
payment solutions at your fingertips. ICICI Bank pre-paid cards are a safe & convenient way
for associate payments, disbursements, gifting & small ticket transactions. Pre-paid cards are
available on a VISA platform thus providing accessibility to over 3.5 Lakh merchant
establishments & cash withdrawal from all VISA ATMs in India.
Introduction
A Credit Card is a mode of cash-less transaction that allows the user to pay for goods
or services with the actual payment being made in installments, over a period of time.
Most of the credit cards in the market belong to either MasterCard or Visa. For
principal services to the industry they are typically paid 0.025% of the transaction by
the issuing bank:
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3.2 CREDIT CARD WITH INTERNET ACCESS TO ALL CUSTOMERS
ICICI Bank, the banking subsidiary of ICICI Ltd. (NYSE: IC and ICD) launched
India's first Credit Card with Internet access to all customers. The launch adds another
first to ICICI Group's Internet and e-commerce initiatives. ICICI Bank has pioneered
Internet Banking in the country. Recently, ICICI announced the launching of India's
first Internet stock trading service on www.icicidirect.com/
The launch marks the foray of ICICI Bank into credit cards. ICICI Bank's credit card
holders would have the convenience of accessing credit card information including
the facility to view, print statements, obtain details about their payments, outstanding
amount and due date, request a duplicate PIN mailer, send instructions, apply for new
cards as well as add-on cards, on the Internet. ICICI Group as a part of its "Click and
Brick" strategy has been developing multiple access channels including the Internet,
Call Centre and VISA affiliated ATMs. It may be recalled that ICICI Bank has had a
staggering 500% increase in Internet customers from 4,000 as on March 31, 1999 to
24,000 as on December 31, 1999.
Another major first in India would be the flexibility to the customer to choose a sub-
limit for add-on cards, enabling the customer to specify different individual credit
limits at both the primary as well as individual add-on card levels. These limits will
work as monthly limits, which would get refreshed at monthly billing cycles. This
therefore will allow parents to give add-on cards to their children (18 and above) and
yet restrict their spending to desired levels. The limits can also be changed at monthly
intervals thus offering true flexibility to customers. This powerful feature is expected
to eliminate the worry of over spending.
The array of products include:
True Blue : Positioned as an entry level offering, the 'True Blue' card is a value for
money card. Targeted at the general segment the card is available at an application fee
of Rs. 150 and an annual fee of Rs. 300.
Sterling Silver : A complete family offering from ICICI Bank with a free Add-on
Bandhan card along-with comprehensive insurance benefits for both primary as well
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as supplementary card members. Targeted at the upwardly mobile the card is
available at an application fee of Rs. 150 and an annual fee of Rs. 600.
Solid Gold : The International Card with additional comprehensive travel insurance,
as well as a Global One Calling Card and a very attractive balance transfer facility.
The Solid Gold card is being offered at a special invitation price comprising an
application fee of Rs. 300 and an annual fee of Rs. 1200.
The Sterling Silver and Solid Gold cards will also offer a balance transfer facility with
a 1.75% Monthly Percentage Rate (MPR) on Sterling Silver and 1.5% MPR on Solid
Gold respectively, for the first six months.
A tie-up with VISA has ensured that the domestic cards will immediately have
acceptance at over 100,000 outlets in India and the international cards will, in
addition, have acceptance at over 18 million merchants and 530,000 ATMs
worldwide. The Bank has also set up a 24 hour Call Centre to handle customer queries
and built in cash advance facilities at all VISA affiliated ATMs. The Bank has a wide
network of branches at 40 centres in India.
ICICI Bank uses Vision Plus, the reputed credit card software from PaySys, USA and
Infinity, the Internet Banking software from Infosys. A key feature of Vision Plus is
its comprehensive functionality which allows processing starting from application
capture, decisions, account management, delinquency and collection handling as well
as customer service.
According to Shikha Sharma - Senior General Manager, ICICI, - "The entire project
has been executed in record time, with significant investments in hardware and an
internationally proven software. We decided to create our own infrastructure for back-
office processing in order to ensure delivery of quality service to customers, as also
quick innovation and shorter time to market for new products developed in response
to changing customer needs."
"VISA is proud to partner with ICICI Bank for the launch of the entire range of credit
cards in India. Globally, Visa plays a pivotal role in advancing new payment products
and technologies and was therefore a natural choice for a technology-oriented
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institution like ICICI. The ICICI Bank cards offer several value-added and web-
enabled features that leverage the power of the world's largest payment system and
one of India's premier financial institutions," said James G. Murray, Executive Vice
President, South East Asia & Greater China, VISA International.
3.3 CREDIT CARD HOLDER BEHAVIOR
According to Visa Internationals latest data, average Indian cardholder uses his card
9.3 times, spending about Rs. 14,700 per year. A number of card owners do not use
their cards and almost 20 30 % cards are inactive (less than one usage every
quarter).
An important fact that should be observed is that it is only in the past few years that
the Indian customer is beginning to accept Credit. The Indian culture doesnt
promote credit, and it is this outlook change which is the most important development
for the credit card industry. ABN Amro, for instance, backed up their launch of the
Freedom Card with research that showed that the Indian middle class views the
credit card as a potential debt trap.
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3.4 TARGET MARKET
a) Customer Segments:
The segmentation of the card industry can be done on the basis of income.
The Indian market reflects considerable diversities in income levels and lifestyles. A
World Bank estimate places average annual household incomes (in terms of
purchasing power) at US $6452. But there are large segments of people, whose
income levels are significantly higher, growing faster and spurring a consumer
revolution. It is difficult to obtain correct estimates of this group, as there is a very
small percentage of Indias rich who pay income tax and their income levels are
correctly reported. Therefore to conduct this segmentation, we shall have to make use
of National Council of Applied Economic Research (NCAER) data and not the
estimates from the income tax department.
The segment which have been identified are as follows:
Segments Income Group (Rs.)
Very Rich 2,15,000+
Consuming Class 45,0002,15,000
Climbers 22,00045,000
Aspirants 16,00022,000
Destitute
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Segments with high unrealized potential
Mid-Size cities in India have low credit card penetration. The residents of such cities
are affluent and they are good markets for ICICI cards. This low penetration is due to
comparatively low acceptance of credit cards.
Rich farmers who live in the rural belt but also spend quite some time in the nearby
towns can be tapped. A product can be introduced to serve their specialized needs.
The growing number of netizens represents a segment with high-unrealized
potential.
Customers Motivations
Segments Motivations
Very Rich Convenience and acceptability, Level of service, Credit Limit
Consuming Class Prestige, Convenience and acceptability, Level of service, Charges
Climbers Prestige,Charges
Charges include all commissions, interest rate, annual fees, which are to be paid to
the bank. The motivational factor has been derived from the credit card holder
behavior and income levels. This shows differentiation as we move along the various
segments. Fee charges are not at all important for the Very Rich but they assume a
fair degree of importance as we move down the segments. In case of Climbers,
Level of service has very little motivation to offer. This segment primarily has either
the non-premium cards or cards issued by the nationalized banks. In both the
scenarios, level of service is not very high. The other segments have not been
considered since they do not fall into the potential customer category. However, with
the introduction of Kisan Cards (The major issuing banks are: Dena Bank, Punjab
National Bank, State Bank of India Benegal Circle, State Bank of Indore, Vijaya
Bank), these segments are also being brought into purview of credit card users
(assumption: 65% of low-income households are associated with agriculture
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The Indian Middle class
India has registered a very impressive growth of its middle class -- a class
which was virtually non-existent in 1947 when India became a politically sovereign
nation.
At the start of 1999, the size of the middle class was unofficially estimated at
300 million people.
The middle class comprises three sub-classes: the upper middle, middle
middle and lower middle.
The upper middle class comprises an estimated 40 million people. They have
annual incomes of US$600,000 each in terms of Purchasing Power Parity (PPP).
The middle middle class comprises an estimated 150 million people, each
with PPP incomes of US$20,000 per year each.
The lower middle class comprises an estimated 110 million people. An
estimate of their annual income is not available, but they are mostly the relatively
affluent people in the rural areas of India.
The middle classes ON THE WHOLE (i.e. upper middle + middle middle +
lower middle classes) is expected to grow by 5 to 10 percent annually.
3.5 Characteristics of the Indian Credit cardMarket
The credit card market in India is about 3 million with a value turnover of around
Rs.2500 crores. The market is expected to grow by 30% p.a. This would still be a very
low penetration of a potential market of 60 million cardholders. The credit card
business is a low-margin, high volume business.
Thus, given the low income per card and the high initial investments by the bank,
large volumes in terms of cards issued and the transactions financed are required to
make the operations profitable.
India's consuming class
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Table IEstimated households by annual
income
Table IIStructure of the Indian consumer market (1995-96)
Annual income (inRupees) at 1994-
95 prices
No. ofhouseholds(in million)
Annualincome
(in Rupees)at 1994-95
prices
Classification
Number of households (inmillion)
Urban Rural Total
215,000 The rich 0.8 0.4 1.2
Total no. of households:164.9 million Total no. of households 46.6 118.2 164.8
Source: National Council of Applied Economic Research (NCAER). The abovepresentation has been slightly modified by IndiaOneStop.Com
India has now become the third biggest card market for Visa International in Asia
Pacific after Japan and Korea. But the country has a long way to go in terms of card
spend, where it lags behind a number of countries in the region.
Visa is supposed to be the market leader in both credit and debit cards in India. As on
March 31, 06, Visa saw a 36% growth in the number of cards issued. The current
number of debit and credit cards stand at 27m and 12m respectively. The total number
of debit and credit cards issued in India as on the period is estimated to be at around
47m and 18m respectively.
According to Santanu Mukherjee, country manager (South Asia), India is now the
third largest market in Asia Pacific after Japan at 85m cards and Korea at 50m cards.
The total numbers of credit cards issued in India have gone up by 38%, while that for
debit cards rose 35%.
India is among the fastest growing markets for Visa International in the region. China,
Pakistan and Vietnam are the other markets which are growing fast. Mr Mukherjee
said there are around 140m bankable customers in India. More debit cards are being
issued as public sector banks are going in for core banking solutions. Banks have
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started issuing credit cards in Tier II cities and avenues like airline ticketing are
opening up.
Even as card growth has seen a sharp spurt, retail sales volumes (RSVs) - spends by
customers in point of sales (PoS) terminals - are also growing. Visa saw a 61%
growth in RSVs to $5.37bn as on March 31, 06. According to Mr Mukherjee, the
annual spends by customers on credit cards have increased to $380 from $335 the
previous year. RSVs were at $900m in March 31, 02.
However, RSVs in India is comparatively lower than other countries in the region.
For instance, RSVs in Korea for Visa is at $129bn, Japan $103bn, Australia $75bn,
Taiwan $25bn, Hong Kong $20bn, New Zealand $9.4bn, Thailand $7.6bn and
Singapore at $5.89bn.
Says Mr Mukherjee, Debit cards are still being largely used as ATM cards. The
overall consumer awareness is low. Also, acceptance of PoS terminals is not as
prevalent as other markets. For instance, Korea has around a couple of million
terminals. Debit card RSVs in India are now at about 18-19% this year as against
about 15-16% last year.
However, over the past few years, the number of PoS terminals in India have seen a
significant growth. According to him, PoS terminals in India as on March 31, 06 was
at 3,06,000 as compared to 40,000 terminals in March 31, 02. Visa card sales
volumes, which includes RSVs and ATM transactions, have seen a 47% rise to
$432bn as on March 31, 06.
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3.6 LITERATURE ON CREDIT CARDS
Credit card usage in India still low: Survey
The Indian credit cards industry is still in a relatively nascent stage when compared to
economies in West Asia, a survey by MasterCard International has found.
According to the survey results, only 14 per cent of Indians currently own a credit
card. This is in sharp contrast to countries such as the United Arab Emirates and
Kuwait where 63 per cent and 50 per cent of respondents, respectively, own a credit
card. The results indicate the high growth potential for the payment card industry in
India, the survey says.
It further finds that 73 per cent of Indians spend less than $35 on an average each
month, while 25 per cent spend between $35 and $300. Only two per cent of Indians
spend over $300 on their credit cards during a month. On the other hand, only six per
cent of cardholders in the UAE have an average monthly spend below $35, whilst 58
per cent of cardholders in the UAE have an average monthly spend of over $300,
MasterCard International's Consumer Lifestyle survey in the South Asia, Middle East
and Africa Region (SAMEA) found.
The usage of credit cards by Indians is also much lower than their Asian counterparts.
Seventy-two per cent of Indians use their credit cards 1-2 times (or less) a month,
while 23 per cent of Indians use their cards between 3-5 times and the remaining 5 per
cent use cards 6 times or more every month. In the UAE, 31 per cent of cardholders
use their cards more than 10 times during a month, while only 15 per cent use their
cards 1-2 times (or less).
Meanwhile in India, 44 per cent of cardholders use their credit cards most often for
purchase of clothing, 14 per cent for supermarket/grocery shopping, 9 per cent at
hotels and 6 per cent at restaurants. In the other six countries surveyed, the majority of
cardholders use their card most often for supermarket/grocery shopping.
In terms of the single most important factor influencing choice of credit card, 30 per
cent of Indians say they are influenced by the credit card brand, closely followed by
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23 per cent who choose a credit card depending on the credit limit. Interestingly, 8 per
cent of cardholders say they are influenced by the card design, while only 5 per cent
and 2 per cent cardholders say they are influenced by the interest rate and the bank
staff recommendations respectively.
ICICI Bank, Sarovar Hotels' co-branded card
Mumbai Feb 20 ICICI Bank has tied up with Sarovar Hotels to launch a co-branded
credit card. Customers can use the card to get 30 per cent discount on room tariffs at
select Sarovar hotels and 15 per cent discount at Sarovar restaurants.
The bank has around 7 million credit card customers and enjoys a market share of
around 35 per cent.
Sarovar Hotels has around 36 hotels across the country and 20 properties under
development.
Chennai April 3 In the coming months, ICICI Bank will strive to establish a
connection in the minds of its customers between using their debit cards and saving
the planet.
Today, most people use debit cards to draw money from ATMs and spend the money
at shops and restaurants. ICICI Bank wants its customers to use debit cards
straightaway in shops and restaurants and thereby minimise the use of paper currency.
Less paper use is more environment-friendly.
The Reserve Bank of India's figures say that in 1935, India had 100 million pieces of
currency notes in circulation. As at the end of March 2005, the notes in circulation
were 36,985 million or, about 370 times more.
"Imagine how much of energy, how much ink would be consumed in making the
paper," says Dr Nachiket Mor, Deputy Managing Director, ICICI Bank.
The war against currency notes is one of the two steps envisaged under the bank's
recent `Go green India' initiative, the other one being to coax customers to go online,in order to reduce paper-based transactions.
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The initiative itself is a small step towards aligning all the bank's activities to
environment sustainability, Dr Mor told Business Line. The bank's top brass is
mulling bringing in what it calls `environmentally sustainable project finance' or
ESPF guidelines.
Dr Mor pointed out that there were two broad approaches to the issue. First, to frame
rules do's and don'ts to ensure environmental protection on the basis of which
project finance will be made.
The second approach is to take a stand as `do whatever you want, but it will cost you
to go against environment protection'.
Plastic Money: the Currency of Modern India.
Indian consumers have never had it so good. The soiled notes are definitely out.
Plastic money is in! Carrying cash is no more `a pain in the neck' as consumers are
relying more on the `plastic card' which gives them money on credit.
Credit Cards have finally arrived in India. The card industry which is growing at the
rate of 20% per annum is flooded with cards ranging from gold, silver, global, smart
to secure.the list is endless. From just two players in early 80s, the industry now
houses over 10 major players vying for a major chunk of the card pie.
Currently four major bishops are ruling the card empire---Citibank, Standard
Chartered Bank, HSBC and State Bank of India (SBI). The industry, which is catering
to over 3.8 million card users, is expected to double by the fiscal 2003. According to a
study conducted by State Bank of India, Citibank is the dominant player, having
issued 1.5 million cards so far. Stanchart follows way behind with 0.67 million, while
Hongkong Bank has 0.3 million credit card customers. Among the nationalized banks,
SBI tops the list with 0.28 million cards, followed by Bank of Baroda at 0.22 million.
The credit card market in India, which started out in 1981, is on the verge of an
unprecedented boom. Between 1987 and 2000, the market has virtually grown to over
3.8 million cards with almost 25-30 % growth in new cardholders.
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SBI, one of the late entrants in the card market, has managed to grab over 8 per cent
of the market share from the bigwigs like Citibank and Standard Chartered Bank. The
bank's credit card business has grown by 8 per cent over the last two years. According
to bank officials, SBI's card issue so far is to the tune of 0.28 million which is
expected to cross the 1 million mark by the fiscal 2002. The bank is also planning to
launch debit card, global card, gold card and corporate card shortly.
In a bid to tap the lower middle class segment, SBI is currently sharpening its
marketing skills for the launch of `secure card', aimed at its fixed deposit clients. The
bank will be launching this new product at five of its branches at Delhi, the country's
capital within a fortnight. With the launch of `secure card', SBI will become the first
bank to tap the lower middle class segment. By the end of the fiscal 2000, the bank is
expected to take the secure card to over 36 centers throughout the country.
The bank is putting its best foot forward to compete with global card majors like
Citibank and Standard Chartered Bank. The global bigwigs have already established
themselves as the `bankable brands' in the metros. However, in a bid to move to
greener pastures, they are trying to tap the co-branded card market which has vast
potential for growth. Citibank, which is leading the card empire recently launched a
co-branded credit card in partnership with Indian Oil Corporation. The card will offer
its members reward points on every international spend which can be redeemed for
free fuel in India.
Expanding the Card Pie
There may be 3.8 million cards today. But the catch is that there are not 3.8 million
cardholders - one person has multiple cards. This makes the job of selling cards all themore difficult since everybody is targeting the same market segment. What's more,
multiple card ownership ends up splitting card spends.
Only banks, which penetrate the Indian countryside, will be able to stand the test of
the time. For present, consumer is definitely the king!
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CHAPTER IV
DATA ANALYSIS AND INTERPRETATION
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1. Where do you got information about ICICI credit card ?
Table 1: Table showing the source of information regarding credit cards
Variable Rating Percentage
Bank 52 52
Advertisement 8 8
Telemarketing 30 30
Friends 10 10
Others 0 0
Interpretation
About 52% of the respondents got the information regarding credit cards from
the bank and 30% where of the opinion that they got the information from
Telemarketing, 8% from Advertisements and 10% through friends
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Figure 1: Figure showing the source of information regarding credit cards
Bank, 52%
Advertiseme
nt, 8%
Telemarketing, 30%
Friends, 10% Others, 0%
Bank Advertisement Telemarketing Friends Others
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2. Do you think that the income limit fixed for issue of credit cards is apt?
Table2: Table showing the opinion of respondents regarding Income limit for issue
of credit cards
Variable Rating Percentage
Strongly Agree 22 22
Agree 48 48
Neutral 10 10
Disagree 13 13
Strongly Disagree 7 7
Interpretation
About 22% of the respondents Strongly agree that the income limit fixed for
issue of credit cards from the bank is apt and 48% where of the opinion that they
Agree with it,10% doesnt have any opinion 13% Disagreed and 7% Strongly
disagreed regarding the income limit fixed for issue of credit cards
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Figure 2: Figure showing the opinion of respondents regarding Income limit for issue
of credit cards
S A, 22%
A, 48%
N, 10%
D, 13%S D, 7%
S A A N D S D
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3. Do you think that the formalities for issuing credit cards is OK
Table 3: Table showing the opinion of respondents regarding the formalities needed
for credit card issue
Variable Rating Percentage
Strongly Agree 35 35
Agree 30 30
Neutral 5 5
Disagree 20 20
Strongly Disagree 10 10
Interpretation
35% of the respondents strongly agreed that the formalities for issue of credit card is
OK 30% Agreed ,5% remained neutral 20% Disagreed and 10 % Strongly Disagreed
to the statement
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Figure 3: Figure showing the opinion of respondents regarding the formalities needed
for credit card issue
S A, 35%
A, 30%
N, 5%
D, 20%
S D, 10%
S A A N D S D
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4. Does the credit card made your interaction with the bank easy?
Table 4: Table showing the opinion of respondents that credit card made interaction
with the bank easy
Variable Rating Percentage
Strongly Agree 33 33
Agree 57 57
Neutral 0 0
Disagree 6 6
Strongly Disagree 4 4
Interpretation
About 33% of the respondents Strongly agree that credit card made interaction
with the bank easy and 57% where of the opinion that they Agree with it, 6%
Disagreed and 4% Strongly disagreed
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Figure 4: Figure showing the opinion of respondents that credit card made interaction
with the bank easy
S A, 33%
A, 57%
N, 0%
D, 6%
S D, 4%
S A A N D S D
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5. Does the bank provide information regarding accessing credit card information
through internet?
Table 5: Table showing the opinion of respondents that the bank provides information
regarding accessing credit card information through internet
Variable Rating Percentage
Strongly Agree 27 27
Agree 38 38
Neutral 5 5
Disagree 21 21
Strongly Disagree 9 9
Interpretation
About 27% of the respondents Strongly agree that the bank provides information
regarding accessing credit card information through internet and 38% where of the
opinion that they Agree with it, 5 % doesnt have any opinion 21% Disagreed and 9%
Strongly disagreed to the statement
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Figure 5: Figure showing the opinion of respondents that the bank provides
information regarding accessing credit card information through internet
S A, 27%
A, 38%
N, 5%
D, 21%
S D, 9%
S A A N D S D
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6. Are you aware of the fact that you can fix your own credit limit?
Table 6: Table showing the opinion of respondents that they have the flexibility to
fix their credit limit
Variable Rating Percentage
Strongly Agree 32 32
Agree 58 58
Neutral 0 0
Disagree 8 8
Strongly Disagree 2 2
Interpretation
About 32% of the respondents Strongly agree that the bank provides information
regarding accessing credit card information through internet and 58% where of the
opinion that they Agree with it, 8% Disagreed and 2% Strongly disagreed to the
statement
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Figure 6: Figure showing the opinion of respondents that they have the flexibility to
fix their credit limit
S A, 32%
A, 58%
N, 0%
D, 8%S D, 2%
S A A N D S D
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7. Are you able to utilize to the full advantage of the flexibility offered in fixing the
credit limit by self ie. Are you able to limit your spending as a result of this flexibility
Table 7: Table showing the opinion of respondents that they are able to limit the
spending as a result of the flexibility offered in fixing their own credit limit
Variable Rating Percentage
Strongly Agree 28 28
Agree 52 52
Neutral 5 5
Disagree 10 10
Strongly Disagree 5 5
Interpretation
About 28% of the respondents Strongly agree that they are able to limit the spending
as a result of the flexibility offered in fixing their own credit limit and 52% where of
the opinion that they Agree with it, 5% were neutral 10% Disagreed and 5% Strongly
disagreed to the statement
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Figure 7: Figure showing the opinion of respondents that they are able to limit the
spending as a result of the flexibility offered in fixing their own credit limit
S A, 28%
A, 52%
N, 5%
D, 10% S D, 5%
S A A N D S D
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8. Do you think that there is a need for a Card for Internet transactions?
Table 8: Table showing the opinion of respondents that they need a Card for Internet
transactions
Variable Rating Percentage
Strongly Agree 15 15
Agree 30 30
Neutral 15 15
Disagree 22 22
Strongly Disagree 18 18
Interpretation
About 15% of the respondents Strongly agree that they need a Card for Internet
transactions and 30% where of the opinion that they Agree with it, 15% were neutral
22% Disagreed and 18% Strongly disagreed to the statement
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Figure 8: Figure showing the opinion of respondents that they need a Card for
Internet transactions
S A
15%
A
30%N
15%
D
22%
S D
18%
S A A N D S D
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9. Are you of the opinion that the bank is charging high interest rates?
Table 9: Table showing the opinion of respondents that the bank is charging high
interest rates
Variable Rating Percentage
Strongly Agree 18 18
Agree 39 39
Neutral 10 10
Disagree 23 23
Strongly Disagree 10 10
Interpretation
About 18% of the respondents Strongly agree that the bank is charging high interest
rates and 39% where of the opinion that they Agree with it, 10% were neutral 23%
Disagreed and 10% Strongly disagreed to the statement
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Figure 9: Figure showing the opinion of respondents that the bank is charging high
interest rates
S A, 18%
A, 39%N, 10%
D, 23%
S D, 10%
S A A N D S D
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10. Do you think that the bank provides Premium benefits for use abroad?
Table 10: Table showing the opinion of respondents that the bank provides Premium
benefits for use abroad
Variable Rating Percentage
Strongly Agree 12 12
Agree 28 28
Neutral 10 10
Disagree 34 34
Strongly Disagree 16 16
Interpretation
About 12% of the respondents Strongly agree that the bank provides Premium
benefits for use abroad and 28% where of the opinion that they Agree with it, 10%
were neutral 34% Disagreed and 16% Strongly disagreed to the statement
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Figure 10: Figure showing the opinion of respondents that the bank provides Premium
benefits for use abroad
S A, 12%
A, 28%
N, 10%D, 34%
S D, 16%
S A A N D S D
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11. Do you find enough ATM counters for withdrawing money using the credit card
and use it up to its potential
Table 11: Table showing the opinion of respondents that there are enough ATM
counters for withdrawing money using the credit card
Variable Rating Percentage
Strongly Agree 16 16
Agree 22 22
Neutral 8 8
Disagree 34 34
Strongly Disagree 20 20
Interpretation
About 16% of the respondents Strongly agree that there are enough ATM counters for
withdrawing money using the credit card and 22% where of the opinion that they
Agree with it, 8% were neutral 34% Disagreed and 20% Strongly disagreed to the
statement
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Figure 11: Figure showing the opinion of respondents that there are enough ATM
counters for withdrawing money using the credit card
S A, 16%
A, 22%
N, 8%D, 34%
S D, 20%
S A A N D S D
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12. Are you able to use credit card for all your transactions?
Table 12: Table showing the opinion of respondents that they are able to use credit
card for all their transactions
Variable Rating Percentage
Strongly Agree 26 26
Agree 40 40
Neutral 8 8
Disagree 14 14
Strongly Disagree 12 12
Interpretation
About 26% of the respondents Strongly agree that they are able to use credit card for
all their transactions and 40% where of the opinion that they Agree with it, 8% were
neutral 14% Disagreed and 12% Strongly disagreed to the statement
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Figure 12: Figure showing the opinion of respondents that they are able to use credit
card for all their transactions
S A, 26%
A, 40%
N, 8%
D, 14%
S D, 12%
S A A N D S D
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13. Are you getting enough value added benefits and information updates from ICICI
Table 13: Table showing the opinion of respondents that they getting enough value
added benefits and information updates from ICICI
Variable Rating Percentage
Strongly Agree 16 16
Agree 32 32
Neutral 10 10
Disagree 22 22
Strongly Disagree 20 20
Interpretation
About 16% of the respondents Strongly agree that they getting enough value added
benefits and information updates from ICICI and 32% where of the opinion that they
Agree with it, 10% were neutral 22% Disagreed and 20% Strongly disagreed to the
statement
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Table 13: Table showing the opinion of respondents that they getting enough value
added benefits and information updates from ICICI
S A, 16%
A, 32%
N, 10%
D, 22%
S D, 20%
S A A N D S D
14. Do you think that ICICI credit cards are comparatively better?
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Table 14: Table showing that ICICI credit cards are comparatively better
Variable Rating Percentage
Strongly Agree 24 24
Agree 45 45
Neutral 5 5
Disagree 15 15
Strongly Disagree 11 11
Interpretation
About 24% of the respondents Strongly agree that ICICI credit cards are
comparatively better and 45% where of the opinion that they Agree with it, 5% were
neutral 15% Disagreed and 11% Strongly disagreed to the statement
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Figure14: Figure showing that ICICI credit cards are comparatively better
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S A, 24%
A, 45%
N, 5%
D, 15%
S D, 11%
S A A N D S D
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15. Are you fully satisfied with the services of credit card ?
Table 15: Table showing the opinion of customers that they are fully satisfied with
ICICI cards
Variable Rating Percentage
Strongly Agree 32 32
Agree 48 48
Neutral 5 5
Disagree 12 12
Strongly Disagree 3 3
Interpretation
About 32% of the respondents Strongly agree that they fully satisfied with ICICI
cards and 48% where of the opinion that they Agree with it, 5% were neutral 12%
Disagreed and 3% Strongly disagreed to the statement
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Figure 15: Figure showing the opinion of customers that they are fully satisfied
with ICICI cards
S A
32%
A
48%
N
5%
D
12%
S D
3%
S A A N D S D
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CHAPTER V
FINDINGS CONCLUSION AND
SUGGESTIONS
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5.1 FINDINGS
1. Most of the customer got the information regarding credit cards from the bank and
through telemarketing, ie.52% of the respondents got the information regarding
credit cards from the bank and 30% where of the opinion that they got the
information from Telemarketing,
2.Most of therespondents agreed that the Income limit set for issue of credit cards is
apt. ie 22% Strongly agreed and 48% agreed with this
3. Most of therespondents agreed the formalities needed for credit card issue is OK.
35% of the respondents strongly agreed that the formalities for issue of credit card is
OK 30% Agreed
4. Most of therespondents agreed that credit card made interaction with the bank easy
ie 33% strongly agreed and 57 Agreed with this
5. Most of therespondents agreed the bank provide information regarding accessing
credit card information through internet
6. Most of the respondents agreed that they are aware of the fact that they can fix
your own credit limit
7. Most of therespondents agreed that they are able to limit the spending as a result
of the flexibility offered in fixing their own credit limit
8. Most of therespondents agreed that they need a Card for Internet transactions
9. Most of therespondents agreed that the bank is charging high interest rates
10. Most of therespondents agreed that the bank provides Premium benefits for use
abroad
11. Most of the respondents agreed that there are enough ATM counters for
withdrawing money using the credit card
12. Most of the respondents agreed that they are able to use credit card for all their
transactions
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13. Most of therespondents agreed that they getting enough value added benefits and
information updates from ICICI
14. Most of the respondents agreed that ICICI credit cards are comparatively better
About 24% strongly agreed and 45 % agreed with this
15. Most of therespondents agreed that they are fully satisfied with ICICI cards
5.2 CONCLUSION
The Research study dealt with the marketing of ICICI credit cards among various
segments of customers and to find out the customer satisfaction and its
acceptability and the needs and expectations of the market. The particularstudy is done at Duke Front line Financial Services Private Limited. The Front
lines was started a decade ago and are into the business of marketing financial
products of major banks.
By data analysis and its interpretation I was able to arrive at a general conclusion
regarding my study that the customers of ICICI Credit Cards are satisfied and the card
is widely accepted compared to other credit cards .Even though the clients of ICICI
are highly satisfied regarding the credit card and the allied services offered to themstill there are some more needs for the customers .I have put these unmet needs as my
suggestion towards the company.
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5.3 SUGGESTIONS
Unmet Needs
Unmet needs analysis in qualitative research has brought to light benefits which are
not currently being offered by the credit card industry and hence present an
opportunity.
Need for a Card customized for Internet transactions:
With rapid growth of business over the Internet, there now exists a great need for acard suitable for transacting safely and conveniently over the Internet. The growing
number of Internet users will provide a lucrative market for this product.
Need for Premium benefits:
Even though there are credit cards like Diners in the premium segment, there is a
dearth of premium benefits. Examples of these are Special airport Lounges etc.
These benefits are available to the Indian consumer once he goes abroad, but withinIndia, he doesnt get all the extra premium benefits which can associated with
Premium cards.
Proliferation of ATMs:
The credit card can be used for withdrawing cash from an ATM. This revolving credit
facility is also a major revenue earner for the issuing bank (interest charges range
from 1.99 % to 3 % per month). There are very few ATMs in the metros, and are not
there in most non-metro cities. The lack of the ATMs doesnt allow the credit card to
be used to its potential.
Wider Acceptability:
Though the numbers of Merchant Enterprises are on the increase, more ME should be
included in the credit card framework
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BIBLIOGRAPHY
Ramaswamy.V.S and Namakumari.S Marketing Management- Macmillan
business books-third edition
Kothari.C.R,Research Methodology - Vishwaprakasan Publishers
Michael Armstrong & Angela Baron- Performance management
Philip Kotler,Kevin Lane Keller Marketing management- prentice hall
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APPENDIX
CUSTOMER SATISFACTION OF ICICI CREDIT CARDS
QUESTIONNAIRE
Name :Position :
2. Where do you got information about ICICI credit card ?
Bank Advt Telemarketing
Friends Others
2. Do you think that the income limit fixed for issue of credit cards is apt?
Strongly Agree Agree Neutral
Disagree Strongly Disagree
3. Do you think that the formalities for issuing credit cards is OK
Strongly Agree Agree Neutral
Disagree Strongly Disagree
4. Does the credit card made your interaction with the bank easy?
Strongly Agree Agree Neutral
Disagree Strongly Disagree
5. Does the bank provide information regarding accessing credit card information
through internet?
Strongly Agree Agree Neutral
Disagree Strongly Disagree
6. Are you aware of the fact that you can fix your own credit limit?
Strongly Agree Agree Neutral
Disagree Strongly Disagree
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7. Are you able to utilize to the full advantage of the flexibility offered in fixing the credit
limit by self ie. Are you able to limit your spending as a result of this flexibility
Strongly Agree Agree Neutral
Disagree Strongly Disagree
8. Do you think that there is a need for a Card for Internet transactions?
Strongly Agree Agree Neutral
Disagree Strongly Disagree
9. Are you of the opinion that the bank is charging high interest rates?
Strongly Agree Agree Neutral
Disagree Strongly Disagree
10. Do you think that the bank provides Premium benefits for use abroad?
Strongly Agree Agree Neutral
Disagree Strongly Disagree
11. Do you find enough ATM counters for withdrawing money using the credit
card and use it up to its potential
Strongly Agree Agree Neutral
Disagree Strongly Disagree
12. Are you able to use credit card for all your transactions?
Strongly Agree Agree Neutral
Disagree Strongly Disagree
13. Are you getting enough value added benefits and information updates from
ICICI
Strongly Agree Agree Neutral
Disagree Strongly Disagree
14. Do you think that ICICI credit cards are comparatively better?
Strongly Agree Agree Neutral
Disagree Strongly Disagree
15. Are you fully satisfied with the services of credit card ?
Strongly Agree Agree Neutral
Disagree Strongly Disagree
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