GLOBAL BANKING SURVEY: INDIAN BANKING SECTOR IN 2010

The last decade has seen many positive developments in the Indian banking sector. The policy makers, which comprise the Reserve Bank of India (RBI), Ministry of Finance and related government and financial sector regulatory entities, have made several notable efforts to improve regulation in the sector. The sector now compares favorably with banking sectors in the region on metrics like growth, profitability and non-performing assets (NPAs). A few banks have established an outstanding track record of innovation, growth and value creation. This is reflected in their market valuation. However, improved regulations, innovation, growth and value creation in the sector remain limited to a small part of it. The cost of banking intermediation in India is higher and bank penetration is far lower than in other markets. India’s banking industry must strengthen itself significantly if it has to support the modern and vibrant economy which India aspires to be. While the onus for this change lies mainly with bank managements, an enabling policy and regulatory framework will also be critical to their success. The failure to respond to changing market realities has stunted the development of the financial sector in many developing countries. A weak banking structure has been unable to fuel continued growth, which has harmed the long-term health of their economies. In this “white paper”, we emphasize the need to act both decisively addressed, could seriously weaken the health of the sector. Further, the inability of bank managements (with some notable exceptions) to improve capital allocation, increase the productivity of their service platforms and improve the performance ethic in their organizations could seriously affect future performance.

Customer satisfaction is one of the important outcomes of marketing activity (Oliver, 1980; Surprenant and Churchill, 1982; File and Prince (1992) argued that the customers who are satisfied tell others about their experiences and this increases WOM advertising. In this way, banks can increase customers. Spreng et al, 1996; Mick and Fournier, Hackett et al (1997) argued that profit and growth are stimulated primarily by customer loyalty and loyalty is a direct result of customer satisfaction. In the competitive banking industry, customer satisfaction is considered as the essence of success. Caruana (2000) developed a meditational model that links the service quality and service loyalty via customer satisfaction and applied this model in the retail banks in Malta. The results appear to prove the links between service quality, customer satisfaction and customer loyalty. According to Hofstede (2001), most of the Asian cultures (like India, Pakistan) are collectivist [People in the collective cultures discriminate in groups (relatives, institutions and organizations) and out-groups]. In this case, word of mouth (WOM) advertisements are important for the banks.Prabhakaran (2003) mentioned that the customer is the king. High customer satisfaction is important in maintaining a loyal customer base. To link the service quality, customer satisfaction and customer loyalty is important. Kumar et al (2009) stated that high quality of service will result in high customer satisfaction and increases customer loyalty and Naeem and Saif (2009) found that customer satisfaction is the outcome of service quality.

Representative APR 391%

Let's say you want to borrow $100 for two week. Lender can charge you $15 for borrowing $100 for two weeks. You will need to return $115 to the lender at the end of 2 weeks. The cost of the $100 loan is a $15 finance charge and an annual percentage rate of 391 percent. If you decide to roll over the loan for another two weeks, lender can charge you another $15. If you roll-over the loan three times, the finance charge would climb to $60 to borrow the $100.

Implications of Non-payment: Some lenders in our network may automatically roll over your existing loan for another two weeks if you don't pay back the loan on time. Fees for renewing the loan range from lender to lender. Most of the time these fees equal the fees you paid to get the initial payday loan. We ask lenders in our network to follow legal and ethical collection practices set by industry associations and government agencies. Non-payment of a payday loan might negatively effect your credit history.

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