Customers' Attitude towards Debit Cards - A Study


By

Dr. M. Vasan
M.Com, MBA, M.Phil, Ph.D.
Assistant Professor of Commerce
K.S. Rangasamy College of Arts & Science (Autonomous)
Tiruchengode, Tamilnadu-636215
 


INTRODUCTION

Banks are playing vital role in the economic development of a country. A sound and effective banking system is the backbone of an economy. The emergence of private/new generation banks has been changed the entire banking operations drastically by the use of sophisticated new technologies like internet banking, ATMs (Automated Teller Machines), EFT (Electronic Fund Transfer), Debit cards, Credit cards, Mobile banking, etc., are accessible to customers on a 24x7 basis across the world. These modern technologies enable the bankers to overcome the barriers of time and space in extending their customer services.

DEBIT CARD

A debit card is also called as 'plastic money'. Physically, it resembles a credit card. It is a better alternative way of carrying cash or cheque book. It is an electronic card serving as a convenient payment mechanism. Debit card allows the customers to spend only upto the limit of balance available in their account. 

NEED FOR THE STUDY

Now a days, most of the banks are providing diversified facilities to its customers. Out of various facilities debit card is taking lead and has become the most popular and convenient mode of banking facility amongst the customers. This present study is confined to the choice and preference of customers towards the usage of debit card issued by the various private sectors banks in Salem city of Tamil Nadu.

OBJECTIVES OF THE STUDY

* To study the socio - economic background of the sample debit cardholders.
* To study the pattern of usage of debit cards by the sample customers.
* To study the customers' choices and preference in the usage of debit cards.

HYPOTHESIS

* There is no significant association between the personal factors i.e., age, sex, education, occupation, monthly income and using of Debit Cards.

RESEARCH METHODOLOGY

Survey Method has been followed for the study. Both primary and secondary sources of data are used. Well structured questionnaire is designed to elicit necessary data and details from the consumers of retail stores. The secondary data were collected from the books, journals, magazines and web portals. 

A proportionate random sampling method was employed to elicit the necessary information from the debit cardholders in Salem city. The sample size of 200 respondents, representing 40 in each of 5 private sector banks viz., ICICI Bank, HDFC Bank, Corporation Bank, Karur Vysya Bank (KVB) and Ing Vysya Bank in Salem city, has been duly selected to represent the entire universe.

The primary data collected from the respondents has been analyzed with the help of Statistical Package for Social Sciences (SPSS). Percentage analysis and Chi-square test has been employed for testing the hypothesis.

PROFILE OF STUDY AREA

Salem is the fifth largest city in Tamil Nadu which is located in the central part of the southernmost state of India. The name 'Salem' appears to have been derived from Sela or Shalya, the term refers to the place surrounded by hills. Salem district consists of 4 revenue divisions and 9 taluks. It stands in fifth place in the state of Tamil Nadu with the total area of 94km≤. It had a population of 3,016,346 as per 2001 census report which consists of 52% males and 48% of females. The literacy rate was 65.72%, one of the lowest rates in the state and the district was 46.09% urbanized.

PROFILE OF THE RESPONDENTS

Age: The study covers the age group between 21-40 years accounts for the highest percentage of 38% (76) out of 200 respondents. The least group representing 12% (24) belongs to the age group of below 20 years. 31.5% (63) of respondents belong to the age group of 41-60 and 18.5% (37) of the respondents belong to 60 years and above.

Sex: 69.5% (139) of the respondents are male group and the rest 30.5% (61) of the respondents fall in the female group.

Educational Qualification: 45% (90) of the respondents are graduates, 21.5% (43) of the respondents are educated up to SSLC/HSC qualification, 16% (32) of the respondents are Diploma holders and 17.5% (35) of the respondents are Professionals.

Occupation: 29.5% (59) of the respondents are doing business, 17.5% (35) of the respondents are professionals, 32% (64) of the respondents are employed and 21% (42) of the respondents belong to other occupations.

Income: 13% (26) of the respondents are earning a monthly income of Rs.5000 and below, 41.5% (83) of the respondents are earning Rs.5001-10000, 23.5% (47) of the respondents are earning Rs.10001-15000 and 22% (44) of the respondents are earning Rs.15001 and above.

CHOICES AND PREFERENCES OF DEBIT CARDHOLDERS

Table - 1

Nature of Account

No of Respondents

%

Savings A/C

98

49

Current A/C

102

51

Total

200

100


Source: Primary Data

The table-1shows that 49% of the respondents are savings bank account holders.  Majority (51%) of the respondents are current account holders.

Table - 2
Duration of Holding Debit Card

Years

No of Respondents

%

Below 2

47

23.5

2-4

78

39.0

4-6

49

24.5

Above 6

26

13.0

Total

200

100


Source: Primary Data

The table-2 reveals that 23.5% of the respondents are using Debit Card for the period of less than 2 years. 39% of the respondents are using the debit card for the period of 2-4 years, 24.5% of the respondents are using the debit card for the period of 4-6 years and 13% of the respondents are using the debit card for the period of more than 6 years.

Table - 3
Sources of Information

Sources

No of Respondents

%

Perception/ Belief

69

34.5

T.V/ News paper/ Magazines

46

23.0

Family members/ Relatives

56

28.0

Banker/ Representatives

29

14.5

Total

200

100


Source: Primary Data

The table-3 shows that the majority (34.5%) of the respondents came to know about the Debit Cards through their own experience and belief, 23% of the respondents through Television, News papers and Magazines, 28% of the respondents through family members and relatives and 14.5% of the respondents through banker and representatives.

Table- 4
Frequency of Using Debit Card

Frequency

No of Respondents

%

Daily

28

14.0

Weekly

67

33.5

Fortnightly

48

24.0

Monthly

41

20.5

Occasionally

16

08.0

Total

200

100


Source: Primary Data

The table-4 reveals that 33.5% of the respondents are using Debit Card weekly once, 14% of the respondents are using the debit card daily, 24% of the respondents are using the debit card once in every fortnight and 20.5% of the respondents are using the debit card once in a month and 8% of the respondents are using the debit cards occasionally.

Table - 5
Reasons for Using Debit Cards

Reasons

No of Respondents

%

ATM facility

107

53.5

Shopping

20

10

Avoid carrying cash

45

22.5

All the above

28

14

Total

200

100


Source: Primary Data

The table-5 reveals that the majority (53.5%) of the respondents are using Debit Cards for the purpose of deposit or withdrawal of cash through ATM.  22.5% of the respondents are using to avoid carrying cash, 10% of the respondents are using Debit Cards for shopping and 14% of the respondents are using Debit Cards for all the above reasons.

CUSTOMERS' SATISFACTION WITH DEBIT CARDS OF PRIVATE SECTOR BANKS 

Table - 6
Customers' satisfaction on Debit Card Receiving Procedures

Banks

Level of Satisfaction

Total

Highly Satisfied

Satisfied

Dissatisfied

ICICI

24 (60.0)

14 (35.0)

02 (05.0)

40 (100)

HDFC

19 (47.5)

16 (40.0)

05 (12.5)

40 (100)

Corporation

23 (57.5)

13 (32.5)

04 (10.0)

40 (100)

KVB

24 (60.0)

15 (37.5)

01 (02.5)

40 (100)

Ing Vysya

18 (45.0)

16 (40.0)

06 (15.0)

40 (100)

Total

200 (100)


Source: Primary Data      *Figures in the ( ) are % to Row total.

The table-6 depicts the customers opinion about the receiving procedures involved in debit cards. Only 5% of ICICI Bank customers are dissatisfied whereas 57.5% of the Corporation Bank customers and 60% of the KVB customers are highly satisfied and 40% of the customers are satisfied in HDFC Bank and Ing Vysya Bank with the debit card receiving procedures.

Table - 7
Customers' satisfaction on Availability of ATMs

Banks

Level of Satisfaction

Total

Highly Satisfied

Satisfied

Dissatisfied

ICICI

25 (62.5)

11 (27.5)

04 (10.0)

40 (100)

HDFC

14 (35.0)

10 (25.0)

16 (40.0)

40 (100)

Corporation

06 (15.0)

25 (62.5)

09 (22.5)

40 (100)

KVB

11 (27.5)

07 (17.5)

22 (55.0)

 40 (100)

Ing Vysya

07 (17.5)

15 (37.5)

18 (45.0)

40 (100)

Total

200 (100)


Source: Primary Data      *Figures in the ( ) are % to Row total.

The table-7 inferred that the availability of ATMs. ICICI Bank customers are highly satisfied than other banks. 62.5% of the Corporation Bank customers are satisfied and 55% of the KVB customers and 45% of the Ing Vysya customers are dissatisfied with the availability of ATMs.

Table - 8
Customers' satisfaction on withdrawals limits through ATMs per day

Banks

Level of Satisfaction

Total

Highly Satisfied

Satisfied

Dissatisfied

ICICI

14 (35.0)

17 (42.5)

09 (22.5)

40 (100)

HDFC

13 (32.5)

16 (40.0)

11 (27.5)

40 (100)

Corporation

09 (22.5)

19 (47.5)

12 (30.0)

40 (100)

KVB

26 (65.0)

12 (30.0)

02 (05.0)

 40 (100)

Ing Vysya

16 (40.0)

11 (27.5)

13 (32.5)

40 (100)

Total

200 (100)


Source: Primary Data      *Figures in the ( ) are % to Row total.

The table-8 shows the customers' satisfaction on per day withdrawal limits. 65% of the customers of KVB are highly satisfied, 42.5% of ICICI Bank customers and 47.5% of Corporation Bank customers are satisfied and 27.5% of customers of HDFC Bank and 32% of Ing Vysya Bank customers are dissatisfied.

Table - 9
Customers' opinion on usage of Debit Cards

Banks

Opinion

Total

Highly Satisfied

Satisfied

Dissatisfied

ICICI

24 (60.0)

14 (35.0)

02 (05.0)

40 (100)

HDFC

14 (35.0)

17 (42.5)

09 (22.5)

40 (100)

Corporation

21 (52.5)

13 (32.5)

06 (15.0)

40 (100)

KVB

19 (47.5)

16 (40.0)

05 (12.5)

 40 (100)

Ing Vysya

18 (45.0)

13 (32.5)

09 (22.5)

40 (100)

Total

200 (100)


Source: Primary Data      *Figures in the ( ) are % to Row total.

The table-9 reveals that 60% of ICICI Bank customers and 52.5% of Corporation Bank customers are highly satisfied with the usage of debit card. 42.5% of HDFC Bank customers and 40% of KVB customers are satisfied, 22.5% of the Ing Vysya customers are dissatisfied with the usage of debit card.

Table - 10
Customers' opinion on Service Charges

Banks

Opinion

Total

High

Moderate

Low

ICICI

25 (62.5)

11 (27.5)

04 (10.0)

40 (100)

HDFC

12 (30.0)

21 (52.5)

07 (17.5)

40 (100)

Corporation

16 (40.0)

19 (47.5)

05 (12.5)

40 (100)

KVB

19 (47.5)

13 (32.5)

08 (20.0)

 40 (100)

Ing Vysya

14 (35.0)

16 (40.0)

10 (25.0)

40 (100)

Total

200 (100)


Source: Primary Data      *Figures in the ( ) are % to Row total

It is clear from the table -10, 62.5% of the ICICI Bank customers are opined that the service charges are high. 52.5% of HDFC Bank customers and 47.5% Corporation Bank customers are opined that the service charges are moderate and 25% of the customers of Ing Vysya Bank opined that the service charges are low.

Table - 11
Customers' opinion on Tie up with other Banks

Banks

Opinion

Total

Highly Sufficient

Sufficient

Insufficient

ICICI

22 (55.0)

13 (32.5)

05 (12.5)

40 (100)

HDFC

19 (47.5)

10 (25.0)

11 (27.5)

40 (100)

Corporation

13 (32.5)

16 (40.0)

11 (27.5)

40 (100)

KVB

09 (22.5)

14 (35.0)

17 (42.5)

 40 (100)

Ing Vysya

07 (17.5)

12 (30.0)

21 (52.5)

40 (100)

Total

200 (100)


Source: Primary Data      *Figures in the ( ) are % to Row total.

The table-11 provides the opinion of respondents about tie up with other banks. This tie up with other banks facilitates the customers to have access the debit card with other bank ATMs. 55% of the ICICI Bank customers and 47.5% of the HDFC Bank customers are opined highly sufficient,    40% of the Corporation Bank customers are opined sufficient and 42.5% of the KVB customers and 52.5% of the Ing Vysya customers are opined insufficient.  

Table - 12
Customers' opinion on Tie up with Merchandise Establishments

Banks

Opinion

Total

Highly Sufficient

Sufficient

Insufficient

ICICI

26 (65.0)

10 (25.0)

04 (10.0)

40 (100)

HDFC

17 (42.5)

14 (35.0)

09 (22.5)

40 (100)

Corporation

06 (15.0)

18 (45.0)

16 (40.0)

40 (100)

KVB

04 (10.0)

15 (37.5)

21 (52.5)

 40 (100)

Ing Vysya

03 (07.5)

11 (27.5)

26 (65.0)

40 (100)

Total

200 (100)


Source: Primary Data      *Figures in the ( ) are % to Row total.

The table-12 shows that the tie up between the Merchandise establishments and the banker. 65% of the ICICI Bank customers and 42.5% of HDFC Bank customers are opined highly sufficient, 45% of the Corporation Bank customers are opined sufficient and 52.5% of the KVB customers and 65% of Ing Vysya customers are opined insufficient.

Table - 13
Customers' opinion on Free withdrawals from other Bank ATMs

Banks

Opinion

Total

Highly Sufficient

Sufficient

Insufficient

ICICI

07 (17.5)

21 (52.5)

12 (30.0)

40 (100)

HDFC

03 (07.5)

18 (45.0)

19 (47.5)

40 (100)

Corporation

02 (05.0)

14 (35.0)

24 (60.0)

40 (100)

KVB

05 (12.5)

19 (47.5)

16 (40.5)

 40 (100)

Ing Vysya

01 (02.5)

17 (42.5)

22 (55.0)

40 (100)

Total

200 (100)


Source: Primary Data      *Figures in the ( ) are % to Row total.

The table-13 reveals that the customers' opinion on free withdrawals from other bank ATMs. Most of the banks are allowing only five free withdrawals per month. 45% of the HDFC Bank customers and 47.5% of the KVB customers are opined sufficient, 17.5% of the ICICI Bank customers are opined highly sufficient and 60% of the Corporation Bank customers and 55% of the Ing Vysya Bank customers are opined insufficient about the free withdrawals from the other bank ATMs.

Table - 14
Customers' opinion on Life Time of Debit Cards

Banks

Opinion

Total

Highly Sufficient

Sufficient

Insufficient

ICICI

06 (15.0)

25 (62.5)

09 (22.5)

40 (100)

HDFC

02 (05.0)

20 (50.0)

18 (45.0)

40 (100)

Corporation

08 (20.0)

15 (37.5)

17 (42.5)

40 (100)

KVB

12 (30.0)

22 (55.0)

06 (15.0)

 40 (100)

Ing Vysya

10 (25.0)

18 (45.0)

12 (30.0)

40 (100)

Total

200 (100)


Source: Primary Data      *Figures in the ( ) are % to Row total.

The table-14 indicates that the opinion of respondents about the life time of debit card. At present all banks are issuing not less than five years of validity. 30% of the KVB customers and 25% of the Ing Vysya customers are opined highly sufficient, 62% of the ICICI Bank customers are opined sufficient. 45% of the HDFC Bank and 42.5% of the Corporation bank customers are opined insufficient regarding the life time of debit card. 

SIGNIFICANT ASSOCIATION BETWEEN THE PERSONAL FACTORS AND USING THE DEBIT CARDS

Null Hypothesis (H0): There is no significant association between the personal factors and using the Debit Cards.

Table - 15
Personal Factors Vs. Usage of Debit Cards

S.No.

Personal Factors

Pearson's Chi-square Value

Result

1.

Age

33.80

Significant

2.

Sex

60.84

Significant

3.

Education

85.30

Significant

4.

Occupation

11.32

Significant

5.

Monthly Income

34.20

Significant


The results of Chi-square test indicated that there is significant relationship between personal factors and usage of a Debit Card. Hence, the hypothesis is rejected.
 

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Source: E-mail September 11, 2011

          

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