BHEL Industrial Systems Group
Customer Satisfaction towards RTGS & NEFT facilities
INTRODUCTIONINDUSTRY PROFILE
INDIAN BANKING: MILESTONE & A ROAD AHEADWith the Indian
economy moving on to a high growth trajectory, consumption levels
soaring and investment riding high, the Indian banking sector is at
a watershed. Further, as Indian companies globalize and people of
Indian origin increase their investment in India, several Indian
banks are pursuing global strategies. The industry has been growing
faster than the real economy, resulting in the ratio of assets of
commercial banks to GDP increasing to 92.5 per cent. The Indian
banks have also been doing exceptionally well in the financial
sector with the price-to-book value being second only to china,
according to a report by Boston Consultancy Group.1.1
PRE-INDEPENDENCE BANKING SCENARIO IN INDIAIn India, the ancient
Hindu Scriptures refer to the money lending activities in the Vedic
period. During the Ramayana and Mahabharata eras, banking had
become full-fledged business activity and during the Manu Smriti
period which followed the Vedic period and Epic age, the business
of banking was carried on by the members of the Vaish Community.
Banking is different from money lending but two terms have in
practice been taken to convey the same meaning. Banking has two
important functions to perform, one of accepting deposits and other
of lending money or investment of funds. During the Moguls period,
metallic money was issued and the indigenous bankers added one more
line of money changing to their already profitable business. They
started exchanging money circulating in one part of the country
with the money current in another part of the country making good
margin for them.The English traders, who came to India in the 17th
century, established some contracts with the indigenous bankers by
borrowing funds from them in 1786. The English Agency House had
established the Bank of Bengal at Calcutta with the advent of
modern banking conducted on western lines, the indigenous bankers
lost further importance.
The English House Agency in Calcutta and Bombay were the bankers
to the East India Company and the European merchants in India. They
had no capital of their own and depend mainly on deposits from the
public for finance. These agency houses failed as they combined
banking with trading. Among the earliest banks in established in
India, were the Bank of Bengal (1806), Bank of Bombay (1840) and
Bank of Madras (1843).
These banks were also known as "presidency banks". In 1860 the
concept of limited liability was introduced in banking. These banks
(presidency banks) were allowed to issue notes to a limited extent,
but this right was taken over by the government in 1862. In view of
limited liability, several joint stock banks were floated.The
swadeshi movement which started in the early 1900s gave stimulus to
the growth of indigenous joint Stock Banks.In 1921, the 3
presidency banks were merged to form the Imperial Bank of India.
During 1900 and 1950, the Indian joint stock banks specialized in
providing short term credit, for trade in the form of cash-credit
and over draft facilities, foreign exchange business, remained the
monopoly of foreign banks. Between 1900 and 1925 many banks failed
due to various reasons. The Central Banking Enquiry Committee was
constituted in 1929; it gave the reasons for the failure of banks
such as Insufficient capital, Poor liquidity of assets, Combination
of non-banking activities with banking activities, Irrational
credit policy & incompetent and Inexperienced directors.
It gave wide power to RBI to regulate, supervise and develop the
banking systems. During 1950 to 1969 two important developments
took place, first, the all India Rural Credit Survey Committee,
which examined the issue of credit availability at the rural areas,
recommended the creation or a state partnered sponsored bank
entrusted with the task of opening branches in the rural areas.
Accepting this recommendation, the State Bank of India Act was
passed in 1955 and the Imperial Bank of India was renamed as State
Bank of India. Later in 1959 the State Bank of India (Subsidiary
Bank) Act was passed enabling SBI, to take over 8 princely state
associated banks as the subsidiaries; these banks were State Bank
of Bikaner, State Bank of Hyderabad, State Bank of Indore ,State
Bank of Jaipur, State Bank of Mysore, Bank of Patiala, State Bank
of Saurashtra and Bank of Travancore.Secondly the need about wider
diffusion of banking facilities and to change the uneven
distributive pattern of bank lending was realized. The scheme of
social control over banks was announced in the parliament in
December 1967. The National Credit Control Council was set up in
1968 to assess the demand for bank credit from various sector of
the economy and to determine their respective priorities in
allocation.1.2 POST-INDEPENDENCE DEVELOPMENTS IN BANKING SECTOROn
the eve of independence in August 1947, there were 648 commercial
banks, comprising 97 scheduled and 551 non scheduled banks.
Development in banking sector is divided into two separate groups
namely pre-nationalize period and post nationalize period:1.2.1
PRE-NATIONALIZATION PERIODThe year 1969 was a landmark in the
history of commercial banking in India. In July of that year, the
government nationalized 14 major commercial banks of the country.
In April 1980, government nationalized 6 more commercial banks. In
1951, when the First Five Year Plan (1951 - 56) was launched, the
development of rural India was accorded the highest priority. The
All India Rural Credit Survey Committee recommended. the creation
of a State - partnered and State, sponsored bank by taking over the
Imperial Bank of India and integrating with it, the former State -
owned or State - associated banks. Accordingly, an Act was passed
in the Parliament in May 1955 and the. State Bank of India was
constituted on July 1, 1955. Later, the State Bank of India
(Subsidiary Banks) Act was passed in 1959 enabling the State Bank
of India to take over eight former States - associated banks as its
subsidiaries. During the pre-nationalization period, the industrial
sector claimed the lion's share in bank credit. Within the
industry, the large - scale sector cornered the bulk of credit and
the share of small - scale industries was marginal. There were many
reasons for the dominance of large industrial companies in the
banking sector. A disturbing feature of the pre-nationalization
banking policy was the negligible share of agricultural sector in
bank credit. This share hovered around 2 per cent of total
commercial bank credit. The privately owned commercial banks were
neither interested nor geared to meet the risky and small credit
requirements of the farmers. Similarly, the share of other
non-industrial sectors in bank credit was also low. Since the
commercial banks were under the control of big industrialists, the
lendable funds of the banks were sometimes used to finance socially
undesirable activities like hoarding of essential commodities.1.2.2
POST NATIONALIZATION PERIODAs already noted, leading commercial
banks of the country were nationalized in 1969 with the following
objectives in view:
To break the ownership and control of banks by a few business
families.
To prevent concentration of wealth and economic power.
To mobilize savings of the masses from every nook and corner of
the country.
To pay greater attention to the credit needs of the priority
sectors like agriculture and small industries.
The post nationalization period witnessed a remarkable expansion
in the banking and financial system. The biggest achievement of
nationalization was the reallocation of sectoral credit in favour
of agriculture, small industries and exports which formed the core
of the priority sector. Within agriculture, credit for the
procurement of food grains (food credit) was a major item. Other
agricultural activities preferred for credit included poultry
farming, dairy and piggeries. Certain other sectors of the economy
which also received attention for credit allocation were:
professionals and self employed persons, artisans and weaker
sections of society. Conversely, there was a sharp fall in bank
credit to large scale industries. However, the share of small scale
industry registered an upward trend.
Nationalization of commercial banks was a mixed blessing: After
nationalization there was a shift of emphasis from industry to
agriculture. The country witnessed rapid expansion in bank
branches, even in rural areas. Branch expansion programme led to
mobilization of savings from all parts of the country. Nationalized
banks were able to pay attention to the credit needs of weaker
sections, artisans and self - employed. However, bank
nationalization created its own problems like excessive
bureaucratization, red tapism and disruptive tactics of trade
unions of bank employees.1.3 CURRENT ISSUES IN INDIAN
BANKINGDespite substantial improvements in the banking sector, some
issues have to be addressed over time as the reform process is
entrenched further. The discussion on banking developments revolves
around on a wide range of issues like:
Overall redrawing of boundaries between the State ownership of
financial entities and private sector ones.
Public sector character of the banking sector and
efficiency.
Dilution of the government stake and its impact on the
performance of the banking sector.
Corporate governance in banks and other segments of the
financial system.
Transparency of policies and practices of monetary and financial
agencies and accountability.
Prudential requirements of market participants together with
comprehensive and efficient oversight of the financial system.
Maintenance of best practices in accounting and auditing, as
also collection, processing and dissemination of symmetric and
detailed information to meet the market needs.
Relevance of Development Finance Institutions (DFIs).The
commonality among these concerns has given rise to a wide
recognition and acceptance of having a set of international
standards and best practices that every systemically important
country should strive to foster and implement. Financial sector
reforms, introduced in the early 1990s in a gradual and sequenced
manner, were directed at the removal of various deficiencies from
which the system was suffering. The basic objectives of reforms
were to make the system more stable and efficient so that it could
contribute in accelerating the growth process.
In response to reforms, the Indian banking sector has undergone
radical transformation during the 1990s. Reforms have altered the
organizational structure, ownership pattern and domain of
operations of institutions and infused competition in the financial
sector. The competition has forced the institutions to reposition
themselves in order to survive and grow. The extensive progress in
technology has enabled markets to graduate from outdated systems to
modem market design, thus, bringing about a significant reduction
in the speed of execution of trades and transaction costs.
With the increasing integration of various segments of financial
markets, the distinctions between banks and other financial
intermediaries are also getting increasingly blurred. Another
important aspect of reforms in the financial sector has been the
increased participation of financial institutions, especially
banks, in the capital market. These factors have led to increased
inter - linkages across financial institutions and markets. While
increased inter - linkages are expected to lead to increased
efficiency in the resource allocation process and the effectiveness
of monetary policy, they also increase the risk of contagion from
one segment to another with implications for overall financial
stability. This would call for appropriate policy responses during
times of crisis. Increased inter - linkages also raise the issue of
appropriate supervisory framework.
Banking sector reforms in India are grounded in the belief that
competitive efficiency in the real sectors of the economy will pot
realize its full potential unless the banking sector was reformed
as well. Thus, the principal objective of banking sector reforms
was to improve the allocative efficiency of resources and
accelerate the growth process of the real sector by removing
structural deficiencies affecting the performance of banks.
In India, while the banking system continues to play a
predominant role, it is significant to note that, as a result of
various reform measures, the relative significance of financial
markets has increased. This augurs well for the overall stability
of the financial system. The East Asian crisis has also underlined
the need for a balanced financial system wherein financial markets
also play an important role in providing necessary liquidity,
especially during times of crisis. Banking system also requires
liquidity in times of stress, which only deep and liquid financial
markets can provide.
1.4 TYPES OF E-PAYMENTS1. Electronic Clearing Service (ECS
Credit)
2. Electronic Clearing Service (ECS Debit)
3. Credit & Debit Cards
4. National Electronic Funds Transfer (NEFT)
5. Real Time Gross Settlement (RTGS)1.5 NATIONAL ELECTRONIC
FUNDS TRANSFER (NEFT)NEFT is a facility provided to bank customers
to enable them to transfer funds easily and securely on a
one-to-one basis. It is done via electronic messages. In order to
speed up the transactions there are up to 6 transactions in one
day. Even though it is not on real time basis like RTGS (Real Time
Gross Settlement), NEFT facilities are available in 30,000 bank
branches all over the country and work on a batch mode. NEFT has
gained popularity due to it saving on time and the ease with which
the transactions can be concluded. This reflects from the fact that
42% of all electronic transactions in the 2014 financial year were
NEFT.
National Electronic Funds Transfer (NEFT) NEFT is electronic
funds transfer system, which facilitates transfer of funds to other
bank accounts in over 63000 bank branches across the country. This
is a simple, secure, safe, fastest and cost effective way to
transfer funds especially for Retail remittances.1.5.1 FEATURES OF
NEFT
Customers can remit any amount using NEFT Customer intending to
remit money Through NEFT has to furnish the following particulars:
IFSC (Indian Financial System Code) of the beneficiary
Bank/Branch
Full account number of the beneficiary
Name of the beneficiary.1.5.2 BENEFITS OF NEFT
NEFT is an electronic funds transfer process used in India that
allows users to easily transfer money in a very short time. The
NEFT process has numerous associated advantages for both business
and individuals. A couple of these benefits are listed here
below:SECURE AND EFFICIENTThe NEFT process is highly efficient and
it allows seamless movement of money or transfer from a certain
bank to the next. Furthermore, the entire process is regarded as
highly secure. This means there are fewer chances of errors
occurring during the whole process.
LOW COSTThe other benefit that has many people considering NEFT
as their main technique of transferring money is the low cost it
charges. In fact, the costs involved during the NEFT process are
much lesser compared to when you make demand drafts or pay orders.
Hence, many small businesses in India are now using NEFT due to its
economical nature.HIGHLY RELIABLE
NEFT is highly reliable and this is attributed to the fact the
Indian reserve bank is the main coordinating agency of this
process. This greatly reduces any likelihood of discrepancy when
making financial transactions between various banks. That is the
reason NEFT transactions cannot be revoked, since it has a high
accuracy level.ELIMINATES DELAYS
NEFT transactions are designed to eliminate the normal delays
associated with fund movements in general. This is because all
transactions are quickly settled within one day from the start of
the transaction. This means your customers or clients will get
their money on time once it has been sent to their respective
accounts.
Since the entire NEFT process is completely paperless, it helps
lessen the need to cut trees for producing paper. Hence, NEFT is
environmentally friendly. Furthermore, it is also risk free since
fund transfers are processed and immediately settled within one
day.1.6 REAL TIME GROSS SETTLEMENT (RTGS) SYSTEMRTGS is a fund
transfer systems where transfer of money or securities takes place
from one bank to another on a real time and on gross basis.
Settlement in real time means payment transaction is not subjected
to any waiting period. The transaction is settled on one to one
basis without bunching or netting with any other transaction. Once
processed, payments are final and irrevocable. This was introduced
in 2004 and settles all inter-bank payments and customer
transactions above 2 lakhs.
The development of RTGS systems started as a response to the
growing awareness of the need for sound risk management in
large-value funds transfer systems. RTGS systems offered a powerful
mechanism for limiting settlement and systemic risks in the
inter-bank settlement process, because these risks effect final
settlement of individual funds transfers on a continuous basis
during the processing day. In addition, RTGS can also contribute to
the reduction of settlement risk in securities and foreign exchange
transactions by providing a basis for Delivery-Versus-Payment (DVP)
or Payment-Versus-Payment (PVP) mechanisms. An understanding of
RTGS is thus essential when considering risk management in payment
and settlement systems.
The RTGS system is primarily meant for large value transactions.
The minimum amount to be remitted through RTGS is Rs. 2 lakh. The
maximum limit is Rs. 10 lakh per day.The RBI first implemented the
RTGS in March 2004 as a major technology based electronic funds
transfer system across the country. The RTGS infrastructure is
critical in facilitating the orderly settlement of payment
obligations.
In August 2013, the RTGS saw 62.10 lakh transactions (including
customer transactions, inter-bank transactions and inter-bank
clearing) aggregating to Rs. 67,55,735 crore.
1.6.1 FEATURES OF RTGS A modular component structure to meet
individual country requirements and for flexibility in growth and
expansion as needs arise. Final and irrevocable settlement of funds
transfers continuously in real-time. Centrally located queuing of
payments that are held awaiting availability of funds. Automatic
gridlock resolution. Complete monitoring of account balances for
both the Central Bank and participating institutions. Credit and
intra-day liquidity management facilities. Maintenance of a
statistical database with query and reporting facilities. Payment
entry and processing using standard SWIFT message formats.
A multi-currency and multi-lingual system.
Secure payment and message transmission using the SWIFT services
& secure interactive communication for monitoring & queue
management.
Operational reliability with backup and contingency
arrangements.
Complete audit trail, recovery and reporting facility.
1.6.2 BENEFITS OF RTGS Hassle-free high value settlement:
Elimination of collection through physical H/V clearing.
Eliminates Settlement Risk & Systemic Risk
Speed: Guaranteed and fast settlement of transactions.
High Liquidity: Lower of interest costs.
Reduces paper work and improves efficiency.
1.6.3 ABILITY TO LIMIT PAYMENT SYSTEM RISKRTGS systems can
contribute substantially to limiting payment system risks. With
their continuous intraday final transfer capability, RTGS systems
are able to minimize or even eliminate the basic interbank risks in
the settlement process. More specifically, RTGS can substantially
reduce the duration of credit and liquidity exposures. To the
extent that sufficient covering funds are available at the time of
processing, settlement lags will approach zero and so the primary
source of risks interbank funds transfers can be eliminated. Once
settlement is effected, the receiving ban can credit the funds to
its customers, use them for its own settlement purposes in other
settlement systems or use them in exchange for assets immediately
without facing the risk of the funds being revoked. This capability
also implies that, if an RTGS system were linked to other
settlement systems, the real-time transfer of irrevocable and
unconditional funds from the RTGS system to the other systems would
be possible. The use of RTGS could therefore contribute to linking
the settlement process in different funds transfer systems without
the risk of payments being revoked.1.7 DIFFERENCES BETWEEN RTGS
& NEFT RTGS is based on gross settlement while, NEFT is based
on net settlement. Gross settlement is where a transaction is
completed on a one-to-one basis without bunching with other
transactions. As for a Deferred Net Basis (DNS), or net settlement,
this is where transactions are completed in batches at specific
times. In NEFT, all transfers will be held up until a specific time
whereas RTGS transactions are processed throughout the working
hours of the system. RTGS transaction involve large amounts of
cash, basically only funds above Rs. 1,00,000 may be transferred
using this system. For NEFT, any amount below Rs. 1,00,000 may be
transferred, and this system is generally for smaller value
transactions involving smaller amounts of money. RTGS processes in
real-time (Push Transfer), while NEFT processes in cycles during
the given working day. This causes a NEFT transaction that is
initiated later than the last cycle to be completed the next
day.COMPANY PROFILE
1.8 HISTORYThe Karnataka State Co-operative Apex Bank Limited
(hereinafter referred to as the Bank) is a Scheduled Co-operative
Bank incorporated under the Karnataka State Co-operative Societies
Act 1959. It was established in the year 1915 is entering its
Centenary year during next year. During the year in its inception
the Bank had deposits of Rs.1.26 lakh, owned funds of Rs. 0.54 lakh
and working capital of Rs.1.80 lakh. During the last 99 years the
bank has achieved significant development and considered one of the
premier State Co-operative Bank in the country. Our Bank is known
for its commitment for the development of farmers in the state and
also Primary Agricultural Credit Co-operative Societies and
District Central Co-operative Banks.
Today it has 42 branches in Bangalore City through which it
carries out commercial banking activities. It does not have any
branches outside Bangalore.
The Bank was registered on 10th November 1915 under the name and
style of The Mysore Provincial Cooperative Bank Limited, under the
Mysore Co-operative Societies Act of 1905. Then, the Bank was not
an Apex institution, as it was not exclusively meant for financing
the co-operatives in the State of Mysore. Another Bank called the
Bangalore Central Co-operative Bank Limited, Bangalore (which was
later converted into an urban bank), which was registered in 1905,
was also financing the co-operatives. The bank owes its origin to
Sri. M.A. Narayan Iyengar, B.A., B.L., who was the Registrar of
Co-operative Societies at that time.The bank was founded with the
objective of financing, inspecting and supervising the Co-operative
societies in the Mysore State. Subsequently, several district
co-operative central banks with the jurisdiction of a district were
registered. Five such district central banks were started. But
their working was not satisfactory and they become defunct.
As such the provincial bank started financing the societies
directly. Besides granting of loans, the bank served as an outlet
for investment of the surplus finds of the co-operative societies
in the state. The bank thus acts as the balancing centre of the
co-operative movement in the state, safeguarding its interests.
1.9 REORGANIZATION OF PROVISIONAL CO-OPERATIVE INTO AN APEX
BANK
At the time of inception of the Mysore Provincial Co-operative
Bank, there was also another co-operative organization, the
Bangalore Central Co-operative Bank, which was working on similar
lines. This was an anomaly, which led to mutual competition
unnecessarily in the matter of financing of co-operative societies.
In order to remove this anomaly and to have only one institution as
an Apex institution exclusively for financing the co-operatives in
the state, the government appointed and enquiry committee known as
the Mysore Co-operative Enquiry Committee, 1920-22 presided over by
Mr. Lallubhai Samaldas and the committee after reviewing the
position of these two banks, made the following three alternative
recommendations to the government:
To amalgamate the Mysore Provincial Co-operative Bank and the
Bangalore Central Co-operative Bank.
To create a new Apex Bank.
To convert the Central Co-operative Bank into an urban bank
dealing only with the individuals and to reorganize the Provincial
Co-operative Bank into a new Apex Bank.
1.10 PRINCIPAL FUNCTIONS OF THE APEX BANK
Financing of Short Term Loans for Seasonal Agricultural
Operations and for marketing of crops. These loans are repayable
within one year. During the year 2011-2012, Apex Bank has disbursed
total loans of Rs.4423.28 crores of which Rs. 3736.37 crores for
Agricultural purposes and Rs. 687.11 crores for Non-Agricultural
purpose. Advancing Medium Term Loans for the development of
agricultural infrastructure such as Lift Irrigation, Dairy,
Poultry, Plantations, Gobar Gas, etc under schematic lending.
Providing cash credit loans to processing, marketing and consumer
co-operatives as well as sugar factories in Karnataka and also term
loans to sugar factories under consortium arrangements. Advancing
Working Capital Loans to state levels co-operatives like MARKFED,
KCCF and to the national level co-operatives such as IFFCO and
KRIBHCO. The bank provides similar facilities to public sector
undertakings like Food Corporation of India through consortium
arrangements with commercial banks and at times directly. The Bank
extends finance to non-farm sector and for the development of
cottage industries, small scale industries and rural artisans and
weavers. It is a Scheduled Bank in all respects including
remittances of funds by Demand draft, Mail transfers, Collection of
cheques and Drafts.1.11 REAL TIME GROSS SETTLEMENT (RTGS) AND
NATIONAL ELECTRONIC FUNDS TRANSFER (NEFT)
RTGS system is primarily for large value money transaction. The
minimum amount to be remitted through RTGS is Rs. 2 lakhs and below
Rs. 2 lakhs can be transferred through NEFT.
RTGS is the fastest, cheapest and has left free system of
transferring money from one account in difference places. RTGS is
now implemented in Apex Bank. Apex Bank is the fourth State
Co-operative Bank in India in implementing RTGS.
RTGS or NEFT form
1.12 QUALITY OBJECTIVE
The main aims and objectives of the Bank defined in the Bank Bye
Law No. III are given below.
a. To serve as a State Co-operative Bank and as a balancing
center in the State of Karnataka for registered co-operative
societies;b. To raise funds by way of deposits, loans, grants,
donations, subscriptions, subsidies etc. for financing the members
by way of loans, cash credits, over-drafts and advances;c. To
develop, assist and co-ordinate the member DCCBs and other
Co-operative Societies and secure financial assistance for them;d.
To participate in financing Co-operative and other institutions who
are members of the bank, directly or through consortium of
Bankers;e. To participate in the schematic lending and to provide
loans for which refinance facility is available with term lending
institutions.f. To arrange for the inspection and supervision of
the affiliated DCCBs and other Co-operative Societies and guide
them in their working;g. To buy and sell securities for the
legitimate investment of surplus funds and act as agents for buyers
and sellers of securities of Central/State;h. To carry on general
business of Banking and other banking activities to the members and
customers;i. To purchase, acquire or raise or otherwise obtain
moveable or immoveable property for the own use of the Bank and
also to dispose them of when not required;j. To take measures to
help Co-operative Education;k. To promote and undertake
Co-operative Research and Co-operative Development;l. To manage,
sell or release any property which may come into the possession of
the bank in satisfaction of or part satisfaction of any of its
claims;m. To promote economic interest of the members of the Bank
in accordance with the principles of Cooperation.n. To do such
other things as are incidental or conducive to the promotion and
advancement of the business of the Bank1.13 APEX VISION
Equitable and sustainable micro financial inclusion for overall
rural prosperity through meaningful utilization of Human Endeavour
and Capital.1.14 APEX MISSION
Equitable and sustainable micro financial inclusion for overall
rural prosperity through meaningful utilization of Human Endeavour
and Capital.1.15 OBJECTIVES OF THE KSC APEX BANK
Helping farmers to get irrigation, dairy, poultry facilities and
advancing working capital loans to national level co-operative.
Financial to non-for sector for development of cotton industries
rural artisans and weavers
Bank carries all the banking transaction like remittances of
funds by demand drafts, mail transfer, collection of cheques and
drafts, issue of consumer loans, vehicle loans, housing loans,
salary earners loans and gold loans etc.
Bank monitors the inland mutual arrangement scheme under which
money remittances a cheques are facilities between members
banks.
Establishing banks presence in all district of Karnataka.1.16
DOMAIN NETWORK : State Level - Karnataka State Co-operative Apex
Bank Ltd. (KSCAB)
District Level - District Central Co-operative Banks (DCCBs)
Block, Taluk & Hobli Level - District Central Co-operative
Banks Branches (DCCBBs)
Village Level - Primary Agricultural Credit Co-operative
Societies (PACS)1.17 ACTIVITIES OF THE BANK Financing short-term
(agriculture) loans for crop production and marketing of crops and
advancing Medium Term Loans for development of agricultural
infrastructure such as lift irrigation, dairy, poultry, plantation,
gobar gas etc. Extending cash credit loans to processing, marketing
and consumer co-operatives as well as sugar factories in Karnataka.
Advancing term loans to new co-operative/Private sugar factories
under consortium arrangement in Karnataka. Advancing working
capital loans to sugar factories, state level cooperatives and to
national level cooperatives such as IFFCO, KRIBHCO and to state
level undertakings through consortium arrangements with commercial
banks. Financing to non-farm sector for development of cottage
industries, small scale industries and rural artisans and weavers.
To carry on general business of Banking like remittances of funds
by DD, Mail Transfer, Collection of Cheques and Drafts, issue of
consumer loans, vehicle loans, housing loans, salary earners loans
and gold loans and other banking activities to the members and
customers. To monitor the Inland Mutual Arrangement Scheme under
which money remittances and collection of bills and cheques are
facilitated between member banks The Bank is a member of All India
Mutual Arrangement Scheme, whereby money remittances could be made
and DDs issued as well as Bills and Cheques sent for collection
throughout India. Similarly, Mail Transfers and Bills Collection
are facilitated from any part of the country to Apex Bank.1.18
BOARD OF DIRECTORSAccording to the Karnataka Cooperative Societies
Act and Byelaws of the Bank, function of the Bank is regulated by
the Board of Directors of the Bank consisting of one elected
nominees of each District Central Cooperative Banks and Government
Nominees. The Board is headed by the President followed by Vice
President, Managing Director. The Chief General Manager, National
Bank for Agriculture and Rural Development Bank and Registrar of
Cooperative Societies are also among the Board of Directors, and
are Government Nominees. The Board Meeting is convened once in a
month. The Executive Committee Meeting is convened once a
month.
In addition, the bank is also having Sub Committees consisting
of Board of Directors in each Committee to monitor the functions of
the Bank and District Central Cooperative Banks.1.19 PRODUCTS
AVAILABLE BY APEX BANK1.19.1 DEPOSIT SCHEMES AT ATTRACTIVE RATES OF
INTEREST
Term Deposit
Savings Bank Account
Current Account
Remittances
1.19.2 LOAN PRODUCTS AT ATTRACTIVE RATES OF INTEREST
1. Site Purchase LoanPurchase of sites at Bangalore.2. Cash
Credit FacilityThis loan is for helping traders to carry on
business by availing working capital facility from the Bank.3.
Commercial VehicleThe Bank provides loans to purchase vehicle for
commercial use only.
4. Professional LoanA loan product specially designed to offer
security based and hassie free financial assistance to
professionals and self-employed persons.
5. Apex ProfessionalPersonal loans to Doctors, Engineers,
Architects and also to prompt Income Tax payees.6. Apex PensionLoan
for pensioners to meet Medical expenses, other genuine needs and
emergent personal expenses.
7. Apex GoldLoans to individuals for purchase of Gold
jewellery.
8. Apex Self Employment Terms loans and working capital loan for
purchase of Tools.
Loan to Auto-mechanics / Electricians / Plumbers and Carpenters
engaged in servicing & repairing, to meet their working capital
requirements.
Self-employed persons who are engaged in servicing and
repairs.9. Apex WomenLoan sanctioned to women to meet their genuine
personal needs like buying household articles, gifts and
jewellery.10. Apex RetailThe loan for petty traders.
11. Apex Overdraft Loans to individuals pursuing such activities
like Retail trade, Small Business and professionals.
Loan against the security of National Saving Certificate/Life
Insurance Corporation policy/Gold Ornaments, etc.12. Apex RentLoan
based on the rental income of the property Rented/leased out to
Central/State/Semi Government / Banks / Financial Institutions and
Multinational Companies.
13. Apex TravelTo meet travel and lodging expenses of
individuals for travel in india and abroad either through
personally arranged tours or through conducted tours.
14. Apex EducationEducational loan to deserving/meritorious
students for pursuing higher education and professional courses in
India and abroad in reputed Universities/Institutions.
15. Apex CashLoan against approved Bonds like RBI/NABARD/Other
Government Bonds.16. Apex PersonalLoan scheme for employees of
Corporates-Professionals can avail this loan.
17. Advance Against NSCsThe Bank provides advances against NSCs
to the residents of Bangalore city.
18. Jewel LoanThe Bank provides Jewel Loan against pledge of
gold ornaments to the residents of Bangalore city.
19. Vehicle LoanThe Bank provides loans to purchase two
wheelers/four wheelers for personal use only.20. Home LoanThe
housing finance services offered by the Bank include Construction
of House / Mortgage Loan, Site purchase / Mortgage Loan, Purchase
of Flats etc., to the public through its network of 42 branches in
Bangalore City.
Residents of Bangalore city are eligible for housing under
certain rules. Persons applying for loans for construction of
house, additional/repairs to the existing House/Flat, purchase of
House/Flats, Site Mortgage/purchase Loan etc. within the limits of
Bangalore City Corporation, BDA, BMRDA, Revenue Villages, BIAPA
& Municipalities coming under the jurisdiction of BMRDA/BIAPA
& Bangalore Rural District & Ramanagara District are
eligible for loan.
21. Installment LoanThe Bank provides Personal Loans to salaried
people living within Bangalore City, to meet expenses such as
education of children, medical expenses of self and family,
purchase of household articles etc.
1.19.3 VALUE ADDED SERVICES Bank Guarantee Bills Safe Deposit
Lockers DDs under IMAS DDs under AIMAS1.19.4 INSURANCE SERVICES
Vehicle Insurance Fire/Earthquake Insurance Apex Gold SB
Account1.20 COMPETITORS
1. Shamrao Vital Co-Operative Bank
2. Commercial Banks
3. Corporate Banks1.21 MILESTONES ACHIEVED/AWARDS RECEIVED
Bank is able to lend 75% of the state and it covers all sugar
factories in Karnataka.
Apex Bank is habituated to get awards at National levels year
after year similarly.
NABARD has been performance award and even PACS have not have
logged behind in getting national recognition. All DCC banks and
merely 80% of PACS have proved themselves to be financially
viable.
Nearly 40% of the loans have been advanced to weaker
section/SC/ST and agricultural labourers.
RTGS (Real Time Gross Settlement) system has been implemented in
view of speedy transfer of funds.
Bank has entered an agreement with Oriental Insurance Company
Ltd., to sell various insurance1.22 AREA OF OPERATION
Apex bank works in the regional level only. It does not work in
national level. The area of operation covers the entire Bangalore.
It has 42 branches in Bangalore and headquartered in Pampa Mahakavi
Road, Chamarajpet. The branches of office bank are adequately
delegated with power of sanction of disbursements. If the loans are
to be provided up to 10 lakhs it is handled by concerned branch
offices but if is more than 10 lakhs then it is handled by main
branch.
1.23 OBJECTIVES OF THE STUDY
To understand the NEFT and RTGS facilities provided by the KSC
Apex bank.
To identify various customers involved in the transaction using
NEFT and RTGS.
To find customer satisfaction towards banking services on NEFT
and RTGS.
To provide the findings, suggestions to increase the
effectiveness of KSC Apex bank internet banking services to
customers.1.24 SCOPE OF THE STUDY
The study is made by considering the entire APEX bank. It
investigates about all applications of online banking in APEX. It
would help society to understand the usefulness of on- line
banking. The study will also help to get the knowledge about
process of internet banking and usefulness to banking industry and
know about customers satisfaction level or reliability on it. As
the study contains the 360 degree information regarding APEX bank
and its internet banking.1.25 LIMITATIONS OF THE STUDY
The study has to complete within a short span of time
prescribed. Findings are based on the records available at the
organizations and the information provided by the company. As the
managers were busy in their daily schedules it was not possible for
me to spend more time in interaction and discussion with them.
1.26 RESEARCH METHODOLOGYThe study is descriptive in nature. The
branch of the bank was selected by convenience and for the sake of
access to the qualitative information. All the information
collected through the books maintained by bank, through
questionnaire, from the employees and also from the website of the
bank.
The methodologies follow collecting information by using two
sources of data namely:
Primary data
Secondary dataPRIMARY DATAPrimary data are the data collected
for the first time and not available in the secondary source. The
primary data is obtained through questionnaire with the officers of
the KSC Apex Bank Ltd.
SECONDARY DATA
The source of secondary data is published materials such as text
book, periodicals, journals, newspaper and annual reports of the
KSC Apex Bank Ltd.
The following are the data sources through which the data have
been collected.
The training and guidance material supplied to the staff of the
branch
Online content of the banks website.
Brochures issued by the bank.
Prospectus issued by the bank.
Several websites on RTGS & NEFT.
1.26.1 SAMPLING TECHNIQUES
The significant component of a research study is the samling
plan. Sample is the fraction of production. Sampling is a
techniques or method or selection of samples. The researcher has
adopted the appropriate technique in a domestic research that is
simple random sampling.
Simple Random sampling is a good technique when there are
comprehensive lists of the target population. Random sampling
should be used when generalization is the objective of the study
and a greater degree of accuracy of estimation of population
parameters is required.
Sampling size: The sample size adopted for the study is 40
respondents.
Sample procedure: Sample procedures through structured
questionnaire.1.26.2 PLAN OF ANALYSISThe primary data collected
from the respondents were evaluated manually. Firstly, data was
analyzed from each area and finally a consolidated analysis was
made, percentage was calculated and used to estimate the proportion
of the response for different aspect under consideration.LITERATURE
REVIEW
1.27 REVIEW OF LITERATURE: INTRODUCTION
Generally, a researcher conducts and surveys the related
literature in order to review the present status of a particular
research topic. From the survey of literature, a researcher is able
to know the quantum of work already done on his research topic so
far not touched, or yet to be undertaken. The overview of
literature at the national or an international level is to be
researched with the help of research reports, articles, books and
other materials. The major benefits of literature reviews are:
firstly, helps the researcher in avoiding duplication of efforts on
the same research topic. Secondly, helps the researcher in adopting
methodologies used successfully by other researchers, writers and
policy makers. Thirdly, suggests new approaches in planning,
organizing the investigation of research topic. Fourthly, helps to
narrow down the research problem more clearly and sixthly, assists
investigators to develop firm understandings of theoretical
implications of proposed inquiries.
This study contributes to literature by focusing Customer
Satisfaction towards RTGS & NEFT. The aim of literature reviews
is to justify, rationale of an ensuring research study, provides an
overview of historical perspectives and to bring to the light the
research trends and problems.
The present study identifies an ample number of research works
at global level in general but at domestic level very few studies
have been reviewed and found most appropriate on customer
satisfaction towards RTGS & NEFT. The contribution of various
researchers, policy-makers and writers to this area has focused on
explaining the process of the RTGS & NEFT and satisfaction of
the customer with the service, their challenges, advantages,
disadvantages, herewith, the study, in brief summary and present
some of them in a descending order as year of publication.
Raopun (2005), evaluated the level of internet banking services
in Thailand and compared the overall satisfaction of banking
facilities like NEFT, RTGS. The author used eight dimensional
quality model given by David A. Garvin, namely, performance,
features, reliability, conformance, durability, serviceability,
aesthetics and perceived quality. The results of the study
indicated that reliability, security system and information
accuracy were the most important perspectives and least important
was the perceived quality of commercial bank. The results of the
study could be used as a guideline to set up a form of service in
order to satisfy the needs of target group accurately and
appropriately.Erickson et al. (2005), studied the technology
acceptance of banking facilities in Estonia. The objective of the
study was to see that to what extent customers accept RTGS and NEFT
as a tool for the satisfaction. The findings of the study suggested
that RTGS and NEFT proved to be beneficial for the customers to
some extent. However, banks need to put much efforts not only into
making a user friendly banking facilities, but also to explain
their customers how the bank facilities was useful to
them.Balwinder Singh and Malhotra .P (2004), examined the impact of
online banking. The objective of the study was to find who uses
internet, why and where. It also examined the respondents reasons
for not using banking online. The data was collected from two
universities of Kwazunatal. The researcher analyzed that males use
more online banking than females. Main services used through
websites were inter-account transfer, paying accounts, checking
balance/ statement, communication with the banks, etc. Security was
the main issue for not using banking online. The author suggested
that to make online banking more adaptive, websites should be more
attractive, more informative and colourful. Training should be
given to customers. Charges of online facilities should also be
less. Banks should advertise and publicize their new products and
services offered on the websites so as to make online banking more
popular among customers.Milind Sathye (1999), in his research
paper, explored the factors affecting the adoption of online
banking by Australian customers. The author stated that online and
other virtual banking had significantly lower the cost structure
than traditional delivery channels. So, the banks should encourage
customers to use internet for banking transactions. The author also
emphasized that for adoption of online banking, it was necessary
that the banks offering this service made the consumers aware about
the availability of such a product and explain how it adds value to
the other products. However, internet should be considered as a
part of overall customers service and distribution strategy. These
measures could help in rapid migration of customers to online
banking resulting in considerable saving of operating costs of
banks.Marius Dannenberg, Dorothee Kellner (1998), overviewed the
opportunities for effective utilization of the Internet with regard
to the banking industry. The authors evaluated that appropriate
application of todays cutting edge technology could ensure the
success of banks in the competitive market. They evaluated the
services of banks via internet as websites provide sophisticated
line of products and services at low price. The authors analyzed
that transactions via internet reduce the risk of data loss to
customers, chance to cut down expenses, higher flexibility for bank
employees, re-shaping the banks image into an innovative and
technologically leading institutes, etc.1.28 NEED FOR THE STUDY
New era treats customers as a God. This study helps KSC Apex
bank to identify the needs of customers in the usage of RTGS &
NEFT facilities and so to improve on the flexibility of RTGS &
NEFT facilities to all the customers. Therefore, this is an attempt
to enhance customer point-of-view to help successfully handling
RTGS & NEFT facilities and make use at the core.DATA ANALYSIS
AND INTERPRETATION
1.29 AGE OF THE RESPONDENT
Table 4.1: Showing the age of the respondents
AGE (in years)
RESPONDENTS
PERCENTAGE (%)
Below 30
20
50
31-45
16
40
46-60
3
7
Above 61
1
3
Total
40
100
Source: From Survey
ANALYSIS: The respondents are mainly classified as less than 30,
31-45, 46-60 and above 61 years. This type of classification is
done only in order to know which age group are more into the usage
of NEFT and RTGS system.
Graph 4.1: Showing the age of the respondents
INTERPRETATION: In the considered respondents, 50% of the
respondents belong to the age group of less than 30 years, 40% of
them are between 31 to 45 years, 7% of them are between 46 to 60
years and 3% of them are above 61 years.
1.30 QUALIFICATION OF THE RESPONDENT
Table 4.2: Showing the qualification of the respondents
QUALIFICATION
RESPONDENTS
PERCENTAGE (%)Up to Higher Secondary
2
5
Graduate
19
47
Post Graduate
18
45
Professional
1
3
Total
40
100
Source: From SurveyANALYSIS: The respondents are mainly
classified as Upto Higher Secondary, Graduate, Post Graduate and
Professional. This type of classification is done only to know the
education qualification of NEFT and RTGS users.Graph 4.2: Showing
the qualification of the respondents
INTERPRETATION: The findings reveal that 3% of the respondent is
professional; 45% are post graduate; 47% are graduate and 5% have
secondary education. The findings therefore imply that most of the
respondents of Apex Bank are Graduate and Post Graduates.1.31
PROFESSION OF THE RESPONDENT
Table 4.3: Showing the profession of the respondents
PROFESSION
RESPONDENTS
PERCENTAGE (%)Unemployed
0
0
Job in Public Sector
16
40
Job in Private Sector
20
50
Business Entrepreneur
4
10
Total
40
100
Source: From SurveyANALYSIS: The respondents are mainly
classified as Unemployed, Job in Public Sector, Job in Private
Sector and Business Entrepreneur. This type of classification is
done to know the profession of the respondents accessing NEFT and
RTGS payment systems.Graph 4.3: Showing the profession of the
respondents
INTERPRETATION: The findings reveal that 10% of the respondents
are business entrepreneur; 50% works in Private Sector: 40% in
Public Sector and none of them are unemployed. The findings
therefore imply that all of the respondents of Apex Bank are
working.1.32 GROSS MONTHLY INCOME OF THE RESPONDENT
Table 4.4: Showing the monthly income of the respondents
INCOME
RESPONDENTS
PERCENTAGE (%)Below 20,000
20
50
20,001-40,000
16
40
40,001-60,000
2
5
Above 60,001
2
5
Total
40
100
Source: From SurveyANALYSIS: The respondents are mainly
classified as less than 20,000; between 20,001 to 40,000; 40,001 to
60,000 and more than 60,001. This type of classification is done to
know which income level of the respondents accessing NEFT and RTGS
payment systems.Graph 4.4: Showing the monthly income of the
respondents
INTERPRETATION: The findings reveal that 50% of the respondents
have below 20,000 income; 40% have 20,001 to 40,000, 5% of the
respondents have 40,001 to 60,000 and 5% of the respondents are
getting more than 60,001 incomes. The finding therefore implies
that income less than 20,000 are more users of RTGS and NEFT.1.33
USAGE OF INTERNET BANKING SERVICESTable 4.5: Showing the usage of
internet banking servicesNO. OF YEARS AS CUSTOMER OF THE
BANKRESPONDENTS
PERCENTAGE (%)< 5 years
21
52
5 years - 10 years
12
30
11 years - 15 years
3
8> 15 years
4
10
Total
40
100
Source: From SurveyANALYSIS: The respondents are mainly the
customers of bank for a period less than 5 years, 5 to 10 years, 11
to 15 years and more than 15 years. This type of classification is
done to know the awareness of internet banking facilities.Graph
4.5: Showing the usage of internet banking services
INTERPRETATION: The findings reveal that 52% of the respondents
are using internet banking services less than 5 years, 30% of them
from 5 to 10 years, 8% of 11 to 15 years and 10% from more than 15
years. The findings are therefore implying that internet banking
services are need to be make much aware to use.1.34 NUMBER OF NEFT
USERS
Table 4.6: Showing the number of NEFT usersPARTICULARS
RESPONDENTS
PERCENTAGE (%)Yes
32
80
No
8
20
Total
40
100
Source: From SurveyANALYSIS: The above table shows the number of
NEFT users among the selected respondents. Out of that 80% of the
sample is currently using the NEFT facility and remaining 20% are
not using or not aware of using this mode of payment system.Graph
4.6: Showing the number of NEFT users
INTERPRETATION: From the above graph, we can come to know that
there are users of NEFT system i.e., 80% of the population are
using this system but 20% are not using or not aware of using this
mode of payment system. So it can be interpreted that only 20% of
the sample are not using NEFT as a mode of transferring the
money.1.35 FREQUENCY OF THE USAGE OF NEFT SYSTEM
Table 4.7: Showing the frequency of the usage of NEFT
systemFREQUENCY
RESPONDENTS
PERCENTAGE (%)Once in a week
4
12
Once in a month
6
19
Very often
10
31
Once in quarter
12
38
Total
32
100
Source: From SurveyANALYSIS: The above table shows the frequency
of the usage of transferring of their funds through NEFT. It can be
considered as Once in a week, Once in a month, Very often or Once
in quarter. Based on their requirement the respondents use this
NEFT system as a mode of the payment system. Graph 4.7: Showing the
frequency of the usage of NEFT system
INTERPRETATION: It is observed that 12% of the respondents
frequently uses NEFT system ie., once in a week, 19% of the
respondents use once in a month, 31% use very often, 38% of the
respondents use once in quarter. By this we can interpret that
though the users of NEFT are more among the selected population,
but the frequency of users are very less i.e., once in quarter.1.36
THE EXPERIENCES OF THE RESPONDENT WHEN USING NEFT FACILITIES &
HOW SOON THEY RECEIVE CREDIT/DEBIT IN THEIR ACCOUNT
Table 4.8: Showing the credit/debit receive in their account
through NEFT
PARTICULARS
RESPONDENTS
PERCENTAGE (%)> 2 hours
18
56
< 2 hours
12
38
Others
2
6
Total
32
100
Source: From SurveyANALYSIS: The above table we can analyze that
the respondents who are using NEFT system, their experiences while
using the system and also in how many hours or time span the amount
will be credited or debited in their account and it is broadly
classified as more than 2 hours, less than 2 hours or any
other.Graph 4.8: Showing the credit/debit receive in their account
through NEFT
INTERPRETATION: From the above graph, we can interpret the 56%
of the respondents using NEFT facilities for the purpose of
transferring money receive a credit/debit in their account in more
than 2 hours, 38% receive less than 2 hours and 6% of them receive
in more than 4 hours due to some technical issues.1.37 RESPONDENTS
OPINION OR DIFFICULTY WHILE FILLING THE NEFT FORM
Table 4.9: Showing the opinion or difficulty while filling the
NEFT form
PARTICULARS
RESPONDENTS
PERCENTAGE (%)Yes
14
44
No
18
56
Total
32
100
Source: From SurveyANALYSIS: The above table we can come to know
the opinion of the respondents while filling the NEFT form. The
difficulty in filling the form can be classified as Yes or No which
states that whether the respondents are facing difficulty while
filling the form or they does not have any difficulty while filling
it.Graph 4.9: Showing the opinion or difficulty while filling the
NEFT form
INTERPRETATION: From the above graph we can come to know that
56% of the selected respondents dont have any difficulty while
filling the NEFT form and 44% of them found the difficulty in
filling it. By this we can interpret that majority of the
respondents dont have any difficulty filling the NEFT form.
1.38 TYPE OF CUSTOMERS USING NEFT TRANSACTIONS IN THE BANK
Table 4.10: Showing the type of customer who uses NEFT on a
large basis
TYPE
RESPONDENTS
PERCENTAGE (%)Business
8
25
Government Employees
2
6
Retired Persons
2
6
Others
20
63
Total
32
100
Source: From SurveyANALYSIS: The above table we can analyze that
type of customer a banker may have who use NEFT transactions on a
larger basis. The type of customer may be divided as businessmen,
government employees, retired persons and others. Graph 4.10:
Showing the type of customer who uses NEFT on a large basis
INTERPRETATION: For the above graph we can interpret that 25% of
the businessmen and 63% others are using this facility on a larger
basis. Only 6% of government employees and 6% of retired persons
are negligible in number as they may not be having any such large
transactions to happen. So to conclude we can say that businessmen
and others are the people who use NEFT on a larger basis.1.39
DEFICIENCIES IN THE USAGE OF NEFT FACILITIES
Table 4.11: Showing the deficiencies in the usage of NEFT
facilities
PARTICULARS
RESPONDENTS
PERCENTAGE (%)Lack of secure
12
38
No confidence
10
31
Others
10
31
Total
32
100
Source: From SurveyANALYSIS: The deficiencies in the usage of
NEFT facility can be distinguished as lack of secure, no confidence
and others. These are the main types of deficiencies which a
customer may have in his mind regarding NEFT. Graph 4.11: Showing
the deficiencies in the usage of NEFT facilities
INTERPRETATION: From the above graph we can interpret that 38%
of the respondents have is no proper security while transferring of
funds through NEFT system. 31% have no confidence and 31% have some
other reasons like cost. Problem may be due to thinking the problem
of hacking and no proper knowledge and so may be the reason most of
the customer hesitate to use NEFT system1.40 DUE TO LACK OF
SECURITY NEFT SYSTEM IS NOT ACCEPTED BY CUSTOMERS
Table 4.12: Showing due to lack of security NEFT system is not
accepted by customers
PARTICULARS
RESPONDENTS
PERCENTAGE (%)Yes
16
50
No
16
50
Total
32
100
Source: From SurveyANALYSIS: Above table shows that how many
customers think that security issues act as a lack to the NEFT
system of payment. It can be classified as Yes or No.Graph 4.12:
Showing due to lack of security NEFT system is not accepted by
customer
INTERPRETATION: From the above graph we come to know that 50% of
respondents think that lack of security and 50% dont think that
there is a lack of security in NEFT system.
1.41 RISK OF MISAPPROPRIATIONS WHILE
TRANSFERRING OF FUNDS IN CASE OF NEFT
Table 4.13: Showing risk of misappropriations while transferring
funds in NEFT
PARTICULARS
RESPONDENTS
PERCENTAGE (%)Yes
12
37
No
20
63
Total
32
100
Source: From SurveyANALYSIS: From the above table, we can come
to know that among the selected respondents the percentage of
people who think that misappropriations are more while transferring
of funds through NEFT and vice versa. The above table can be
analyzed that in the sample size selected the respondents have a
belief that due to misappropriations NEFT facility is not popular
and not being adopted by the account holders for larger volume of
transactions.
Graph 4.13: Showing risk of misappropriations while transferring
funds in NEFT
INTERPRETATION: The above graph represents 37% think that
misappropriations are more in case of transferring of funds while
63% think that due to improve technology misappropriations can be
reduced.1.42 UP GRADATION IN TECHNOLOGY HAS AN EFFECT ON LACK OF
SECURITY WHILE TRANSFERRING OF FUNDS THROUGH NEFT
Table 4.14: Showing up gradation in technology effects on lack
of security in NEFT
PARTICULARS
RESPONDENTS
PERCENTAGE (%)Agree
16
50
Disagree
16
50
Total
32
100
Source: From SurveyANALYSIS: From the above table we can come to
know whether an up gradation in technology has an effect on the
lack of security while transferring of funds through NEFT. The
respondents have given their answers like whether they agree to
this point or not.Graph 4.14: Showing up gradation in technology
effects on lack of security in NEFT
INTERPRETATION: From the above graph we can interpret that 50%
of the respondents agree and 50% does not agree for the upgradation
in technology effects lack of security. So some customers think
that due to technology up gradation security is not there but in
reverse case some people think that due to up gradation in
technology even security has been improved.1.43 NUMBER OF RTGS
USERS
Table 4.15: Showing the number of RTGS usersPARTICULARS
RESPONDENTS
PERCENTAGE (%)Yes
32
80
No
8
20
Total
40
100
Source: From SurveyANALYSIS: The above table shows the number of
RTGS users among the selected respondents. Out of that 80% of the
sample is currently using the RTGS facility and remaining 20% are
not using or not aware of using this mode of payment system.Graph
4.15: Showing the number of RTGS users
INTERPRETATION: From the above graph, we can come to know that
there are users of RTGS system ie., 80% of the population are using
this system but 20% are not using or not aware of using this mode
of payment system. So it can be interpreted that only 20% of the
sample are not using RTGS as a mode of transferring the money.1.44
FREQUENCY OF THE USAGE OF RTGS SYSTEM
Table 4.16: Showing the frequency of the usage of RTGS
systemFREQUENCY
RESPONDENTS
PERCENTAGE (%)Once in a week
825Once in a month
1031Very often
619Once in quarter
825Total
32
100
Source: From SurveyANALYSIS: The above table shows the frequency
of the usage of transferring of their funds through RTGS. It can be
considered as Once in a week, Once in a month, Very often or Once
in quarter. Graph 4.16: Showing the frequency of the usage of RTGS
system
INTERPRETATION: It is observed that 25% of the respondents
frequently uses NEFT system ie., once in a week, 31% of the
respondents use once in a month, 19% use very often and 25% of the
respondents use once in quarter. By this we can interpret that
though the users of RTGS are more among the selected population,
but the frequency of users are very less ie., Very often.1.45 THE
EXPERIENCES OF THE RESPONDENT WHEN USING RTGS FACILITIES & HOW
SOON THEY RECEIVE CREDIT/DEBIT IN THEIR ACCOUNT
Table 4.17: Showing the credit/debit receive in their account
through RTGS
PARTICULARS
RESPONDENTS
PERCENTAGE (%)> 2 hours
619< 2 hours
2269Others
412Total
32
100
Source: From SurveyANALYSIS: The above table we can analyze that
the respondents who are using RTGS system, their experiences while
using the system and also in how many hours or time span the amount
will be credited or debited in their account and it is broadly
classified as more than 2 hours, less than 2 hours or any
other.Graph 4.17: Showing the credit/debit receive in their account
through RTGS
INTERPRETATION: From the above graph, we can interpret the 19%
of the respondents using RTGS facilities for the purpose of
transferring money receive a credit/debit in their account in more
than 2 hours, 69% receive less than 2 hours and 12% of them receive
in more than 4 hours due to some technical issues.1.46 RESPONDENTS
OPINION OR DIFFICULTY WHILE FILLING THE RTGS FORM
Table 4.18: Showing the opinion or difficulty while filling the
RTGS form
PARTICULARS
RESPONDENTS
PERCENTAGE (%)Yes
2269No
1031Total
32
100
Source: From SurveyANALYSIS: The above table we can come to know
the opinion of the respondents while filling the RTGS form. The
difficulty in filling the form can be classified as Yes or No which
states that whether the respondents are facing difficulty while
filling the form or they do not have any difficulty while filling
it.Graph 4.18: Showing the opinion or difficulty while filling the
RTGS form
INTERPRETATION: From the above graph we can come to know that
31% of the selected respondents dont have any difficulty while
filling the RTGS form and 69% of them found the difficulty in
filling it. By this we can interpret that majority of the
respondents face difficulty filling the RTGS form.1.47 TYPE OF
CUSTOMERS THE BANK MAY HAVE LARGE NUMBER OF RTGS TRANSACTIONS
Table 4.19: Showing the type of customer who uses RTGS on a
large basis
TYPE
RESPONDENTS
PERCENTAGE (%)Business
1238Government Employees
2
6
Retired Persons
13Others
1753Total
32
100
Source: From SurveyANALYSIS: The above table we can analyze that
type of customer a banker may have who use RTGS transactions on a
larger basis. The type of customer may be divided as businessmen,
government employees, retired persons and others. Graph 4.19:
Showing the type of customer who uses RTGS on a large basis
INTERPRETATION: For the above graph we can interpret that 38% of
the businessmen and 53% others are using this facility on a larger
basis. Only 6% of government employees and 3% of retired persons
are negligible in number as they may not be having any such large
transactions to happen. So to conclude we can say that businessmen
and others are the people who use RTGS on a larger basis.1.48
DEFICIENCIES IN THE USAGE OF RTGS FACILITIES
Table 4.20: Showing the deficiencies in the usage of RTGS
facilities
PARTICULARS
RESPONDENTS
PERCENTAGE (%)Lack of secure
1444No confidence
515Others
1341Total
32
100
Source: From SurveyANALYSIS: The deficiencies in the usage of
RTGS facility can be distinguished as lack of secure, no confidence
and others. These are the main types of deficiencies which a
customer may have in his mind regarding RTGS. Graph 4.20: Showing
the deficiencies in the usage of RTGS facilities
INTERPRETATION: From the above graph we can interpret that 44%
of the respondents have is no proper security while transferring of
funds through RTGS system. 15% have no confidence and 41% have some
other reasons like cost. Problem may be due to thinking the problem
of hacking and no proper knowledge and so may be the reason most of
the customer hesitate to use RTGS system1.49 DUE TO LACK OF
SECURITY RTGS SYSTEM IS NOT ACCEPTED BY CUSTOMERS
Table 4.21: Showing due to lack of security RTGS system is not
accepted by customers
PARTICULARS
RESPONDENTS
PERCENTAGE (%)Yes
1341No
1959Total
32
100
Source: From SurveyANALYSIS: Above table shows that how many
customers think that security issues act as a lack to the RTGS
system of payment. It can be classified as Yes or No.Graph 4.21:
Showing due to lack of security RTGS system is not accepted by
customers
INTERPRETATION: From the above graph we come to know that 41% of
respondents think that lack of security and 59% dont think that
there is a lack of security in RTGS system.
1.50 RISK OF MISAPPROPRIATIONS WHILE TRANSFERRING OF FUNDS IN
CASE OF RTGS
Table 4.22: Showing risk of misappropriations while transferring
funds in RTGS
PARTICULARS
RESPONDENTS
PERCENTAGE (%)Yes
1553No
1747Total
32
100
Source: From SurveyANALYSIS: From the above table, we can come
to know that among the selected respondents the percentage of
people who think that misappropriations are more while transferring
of funds through RTGS and vice versa. The above table can be
analyzed that in the sample size selected the respondents have a
belief that due to misappropriations RTGS facility is not popular
and not being adopted by the account holders for larger volume of
transactions.
Graph 4.22: Showing risk of misappropriations while transferring
funds in RTGS
INTERPRETATION: The above graph represents 53% think that
misappropriations are more in case of transferring of funds while
47% think that due to improve technology misappropriations can be
reduced.1.51 UP GRADATION IN TECHNOLOGY HAS AN EFFECT ON LACK OF
SECURITY WHILE TRANSFERRING OF FUNDS THROUGH RTGS
Table 4.23: Showing up gradation in technology effects on lack
of security in RTGS
PARTICULARS
RESPONDENTS
PERCENTAGE (%)Agree
1959Disagree
1341Total
32
100
Source: From SurveyANALYSIS: From the above table we can come to
know whether an up gradation in technology has an effect on the
lack of security while transferring of funds through RTGS. The
respondents have given their answers like whether they agree to
this point or not.Graph 4.23: Showing up gradation in technology
effects on lack of security in RTGS
INTERPRETATION: From the above graph we can interpret that 59%
of the respondents agree and 41% does not agree for the upgradation
in technology effects lack of security. So some customers think
that due to technology up gradation security is not there but in
reverse case some people think that due to up gradation in
technology even security has been improved.1.52 COMPARISON ON
NUMBER OF NEFT AND RTGS USERS
Table 4.24: Showing comparison on the number of NEFT & RTGS
users
USERS
RESPONDENTS
PERCENTAGE (%)Only NEFT
8
20
Only RTGS
8
20
Both RTGS & NEFT
24
60
Total
40
100
Source: From SurveyANALYSIS: From the above table we conclude
that if we take only the users of NEFT or RTGS payment system then
the number of users for only NEFT or only RTGS is very low.Graph
4.24: Showing comparison on the number of NEFT & RTGS users
INTERPRETATION: From the above graph we can interpret that 20%
of the respondents use NEFT only and 20% of RTGS only. But if we
take both NEFT & RTGS users the numbers of respondents are less
because it is due to awareness of the payment system.CHAPTER -
5
SUMMARY OF FINDINGS, SUGGESTIONS AND CONCLUSIONS
1.53 FINDINGS During the survey of research study it is found
that most of the customers are not aware of the payment systems
like RTGS & NEFT.
The bank is using the technology and has adopted the recent
payment systems like NEFT and RTGS which is useful for faster
clearing of the transaction and also in quick transfer of
money.
It is found that customers feel there is more service charges
included in case of RTGS system of transactions. Because one of
this reason many of them hesitate to adopt this type of payment
system.
It is found that RTGS is meant for only larger transactions so
there is a minimum limit is case of transferring of funds through
RTGS system so this mode of payment system is not meant for those
transactions which constitutes for smaller transactions within the
minimum limit.
During the transfer of funds it is found that two factors are
involved. In the first factor it is found that information will be
transferred from the payer bank to the payee bank and the second
factor includes that settlement of funds takes place between the
banks.
It is observed that some of the customer who are willing to use
this type of transactions may hesitate to use this due to lack of
security. As in the survey conducted we can know majority of them
have think that there is a lack of security in RTGS and NEFT
payment system.
As stated earlier there are woe factor involved in transfer of
banks. The first factor is the transfer of the information from one
bank branch to another. So it is found that sometimes while
transferring of funds from one bank branch to another, the
information can be misappropriated and the whole transactions may
be lost.
1.54 SUGGESTIONSWith reference to analysis and findings of the
study and my personal experience the following suggestion are
made:
It is suggested that before doing any transactions which is
related to the payment system especially the NEFT and RTGS system,
they have to ensure that there is proper security measures taken
while the transfer of money from one branch account to another is
taking place.
It is suggested from the bank that the participants while
transferring should appoint one of its staff to safeguard
communication in NEFT and RTGS system.
As per the survey conducted, most of the customers are not
willing to accept this type of payment system as they have the fear
of security issues and most of them think that these security
issues are happening only because of up gradation in technology so
it is very much necessary for the bankers to take care of the
security issues.
It is suggested that RTGS and NEFT should be given importance
and the information about it should be conveyed, as many of the
customers would not be having any idea about what actually it
is.1.55 CONCLUSIONS
Based on data analysis and discussion that mentioned, it can be
concluded that the responses of respondents partially agree up
gradation of technology effects security in RTGS and NEFT system.
Findings reveal that Banking facilities like RTGS and NEFT have
satisfied most of people banking needs. Most bank clients enjoy
using e-Banking, this results into a high level of satisfaction. It
is very necessary to pay attention to the risk related issues and a
service charge of the payment systems RTGS and NEFT as it lowers
the level of satisfaction. Findings revealed that there is a weak
positive relationship between Electronic banking and customer
satisfaction. It is therefore true to say that Electronic banking
has a significant effect on customer satisfaction. Awareness it to
be created among the usage of RTGS and NEFT payment systems as many
of them are not aware of the system itself.
Thus, I feel proud in doing my project in a well established
bank which is doing a great job as it is practicing both NEFT and
RTGS system of payment. I wish to conclude by saying that Apex Bank
should increase the number of branches in other cities for further
growth and to extend its customer loyalty.1.56
ACHARYA BANGALORE B-SCHOOL Page 10