Indian banking system: Dormant or lively in providing service quality

Abstract

The purpose of this paper is to evaluate and compare the service quality in the public sector and private sector banks with special reference to SBI and ICICI bank in the Agra region, based on customers’ perception and their expectations regarding service quality. This is an analytical study based mainly on the primary data collected. A questionnaire used in this study is limited to sample of 150 respondents of SBI and ICICI in the Agra region, chosen on a convenient basis. The measurements used were based on widely accepted SERVQUAL model (Parasuraman et. al. 1985, 1988, 1991). A descriptive statistical analysis (combined mean, combined s.d. and z test) was used to compare the level of service quality of Public sector bank (SBI) and private sector bank (ICICI) from customer's perspective. This study examined the service quality gap by comparing customer's expectations and their actual perceptions of both the banks. The result reveals that there is significant difference between the customer's service quality perception towards SBI and ICICI. In order to achieving higher levels of quality service in retail banking, banks should deliver higher levels of service quality and in the present context customers’ perceptions are quite higher than customer's expectations in public sector bank i.e., SBI. Owing to the increasing competition between public and private sector banks, customer service is an important part and bankers of public sector should be rethinking how to improve customer satisfaction with respect to their service quality. This paper makes a useful contribution given that there are only a few studies dealing with the assessment of service quality in the banking environment of Agra region.