ISSN: 2320-5407 Int. J. Adv. Res.

5(6), 1520-1526

Journal Homepage: - www.journalijar.com

Article DOI: 10.21474/IJAR01/4565

DOI URL: http://dx.doi.org/10.21474/IJAR01/4565

RESEARCH ARTICLE
A STUDY ON CUSTOMER SATISFACTION TOWARDS CREDIT CARDS WITH SPECIAL
REFERENCE TO PRIVATE SECTOR BANKS IN SIVAKASI.

Mrs. R. Maheswari. M.Com(CA). M.Phil. D.I.T1 and Dr.T.Palaneeswari. M.Com. M.Phil. Ph.D2.
1. Ph.D. Research Scholar, Assistant Professor of Commerce, SFR College for Women, Sivakasi .
2. Associate Professor of Commerce, SFR College for Women, Sivakasi..
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Manuscript Info Abstract
……………………. ………………………………………………………………
Manuscript History

Received: 22 April 2017

Final Accepted: 24 May 2017
Published: June 2017
Copy Right, IJAR, 2017,. All rights reserved.

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Introduction:-
Credit cards are fundamentally different from the other payment methods in that they involve extending credit rather
than drawing on an existing store of funds. Banks in conjunction with credit card associations such as Visa and
Master card, issue general-purpose credit cards. Department stores also issues credit card to be used for purchases at
that particular store. Like Electronic Fund Transfer, payment by credit card is not anonymous. Since paying with a
credit card does not involve a store of funds, deposit insurance and reserve requirements are not directly relevant.
The bank that issues the card is liable and thus merchants are paid if the cardholders default. If the issuing bank fails,
the credit card association guarantees payment to merchants with outstanding transactions and then has a creditor’s
claim on failed banks.

A credit card is part of a system of payments named after the small plastic card issued to users of the system. The
issuer of the card grants a line of credit to the consumer (or the user) from which the user can borrow money for
payment to a merchant or as a cash advance to the user. A credit card is different from a charge card, where a charge
card requires the balance to be paid in full each month. In contrast, credit cards allow the consumers to 'revolve' their
balance, at the cost of having interest charged. This study focus on the demographic profile of the respondents,
details of banking transactions, utility of usage of credit cards by the card holders, reasons for using credit cards and
level of satisfaction towards credit cards.

Review Of Literature
The credit card helps to identify the important variable in the system such as balance payable, credit card purchase,
interest charges and other payments (Manas Ratha, 1997). The technology has played an important role in the
development of efficient and secure payment system and will continue to create a chequeless, cashless, society with
wireless technology (Narindra Kumar Bhasin, 2009). The E-Banking technology became the engine for triggering
rapid change. The current IT tools explicabilities in the bankings are, Credit Clearing System, Debit clearing system,
RTGS, SFMS, SWIFT, Plastic Money (Debit cards, Credit Cards, Smart Cards, Contactless Smart Cards), ATM, E-
cheque, Mobile Phone Banking, Biometric ATM for rural India and others. (Swati Anand , 2010). Many people

Corresponding Author:- R. Maheswari.

Address:- Ph.D. Research Scholar, Assistant Professor of Commerce, SFR College for Women, 1520
Sivakasi.
ISSN: 2320-5407 Int. J. Adv. Res. 5(6), 1520-1526

have knowledge about credit cards, but do not possess credit cards because of the fear of falling into debt trap. High
income earners and highly educated class use credit cards more, availing high credit limits (Dr.S.Sudhagar, 2012).

Statement Of The Problem:-

Credit cards have changed the way people look at money. Gone are the days when only the rich sported them at
limited counters in select cities. Today, they are a way of life for the middle class too, even in smaller locations
across the country. However, this boom has brought in a lot of complications like credit card fraud, payment
defaulting, unsolicited card and uncontrolled. As every service is internet bound in the present scenario, the
researcher is interested in bringing out the customer satisfaction towards credit cards. With this emphasis the
researcher has chosen this topic

Objectives Of The Study:-

The main objectives of the present study are outlined below
 To measure the level of satisfaction of credit card holders.
 To offer suggestions for further improvement.

Hypotheses
Hypothesis is a tentative proposition formulated for empirical testing. The study is explorative in nature. In order to
achieve the objectives of the study, the researcher has framed the following hypotheses:
 H01: There exists no significant difference between the Gender and the level of satisfaction towards credit card
services.
 H02: There exists no significant difference between the Age and the level of satisfaction towards credit card
services.
 H03: There exists no significant difference between the Marital Status and the level of satisfaction towards
credit card services.
 H04: There exists no significant difference between the occupation and the level of satisfaction towards credit
card services.
 H05: There exists no significant difference between the income and the level of satisfaction towards credit card
services.

Methodology:-
The study is based on both primary and secondary data.

Primary Data:-
The primary data needed for this study is collected from the sample customers through structured questionnaire.

Secondary Data:-
The Secondary data needed for study is collected from various magazines, articles published in newspapers and
surfing through network.

Sampling Design:-
In Sivakasi, an industrial town, TMB, Axis Bank, ICICI Bank, HDFC Banks and City Union Bank are prominently
providing Credit Cards. From these five banks, the respondents will be interviewed for the study. From each bank 30
customers are contacted by applying convenient sampling method. Businessman, Salaried, Professional,
Government Employees and House-wives are given due weightage in identifying the sample.

Statistical Tools:-
The researcher has applied statistical tools such as Percentages, Chi-square test, Scaling Techniques and Garrett
Ranking to analyse the collected data.

Findings:-
Demographic Profile Of The Respondents:-
The demographic profile of the respondents was obtained by using five parameters namely gender, age, marital
status, occupation and monthly income. The same is presented in the Table 1

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Table 1:- Demographic Profile of the respondents

Factor Particulars Number of Respondents Percentage
Gender Male 95 63
Female 55 37
Total 150 100
Age (in years) Below 30 33 22
30-40 65 43
41-50 37 25
Above 50 15 10
Total 150 100
Marital Status Married 105 70
Unmarried 45 30
Total 150 100
Occupation Businessman 52 35
Private Employee 42 27
Government Employee 20 13
Professionals 18 12
Housewives 20 13
Total 150 100
Monthly Income Less than Rs.5000 33 22
(in Rs.) Rs.5000 to Rs.10000 35 23
Rs.10001 to Rs.15000 47 32
More than Rs.15000 35 23
Total 150 100
Source: Primary Data
Table 1 reveals that a majority of 63 per cent of the respondents are male; a majority of 43 per cent of the
respondents fall under the age group of 30- 40 years; a majority of 70 per cent of the respondents are married; 35 per
cent of the respondents are businessman; 32 per cent of the respondents fall under the income scale of Rs.10,001 to
Rs.15,000.

Details Of Banking Transactions:-

The details of banking transactions were obtained by using four parameters namely type of account, purpose of
account and period of operating the bank account and frequency of visit to the bank in a week. The same is exhibited
in the Table 2

Table 2:- Details of Banking Transactions

Variable Particulars Number of Respondents Percentage
Type of Account Saving A/C 87 46
Current A/C 65 35
Fixed Deposit A/C 33 19
Total 185* 100
Purpose of Account General Purpose 95 52
Commercial Purpose 87 48
Total 182* 100
Period of Operating the Below 1 year 31 21
Bank Account 1 year to 3 years 44 29
3 years to 6 years 51 34
More than 6 years 24 16
Total 150 100
Frequency of visit to the One time 25 17
bank in a week Two Times 60 40
Three Times 35 23
More than three times 30 20
Total 150 100

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Source: Primary Data * - Multiple Response

Table 2 exhibits that 46 per cent of the respondents are having savings account; a majority of 52 per cent of the
respondents are general purpose user; 34 per cent of the respondents are maintaining their accounts between 3 years
to 6 years of duration; 40 per cent of the respondents made a visit to the bank two times in a week.

Credit Card:-
Products/ Services Availed Through Credit Cards
The respondents are asked to state the products and services availed through credit cards. The same is exhibited in
Table 3.

Table 3:- Products/ Services availed through Credit Cards

Products / Services Particulars Number of Respondents Percentage
Products Consumer durables 80 44
Home appliances 27 15
Jewellery 20 11
Dress Materials 54 30
Total 181* 100
Services Rail/Air Ticket Booking 60 37
Restaurant 17 10
Hospital Expenses 12 7
Shares/Debentures of selected 13 8
companies
Payment of Insurance Premium 20 12
Utility Bills Payments 43 26
Total 165* 100
Source: Primary Data * Multiple Response

It is clear from the Table 3 that a 44 per cent of the respondents are using the credit card for purchasing consumer
durables; 37 per cent of the respondents are use the credit card for rail/air ticket booking.

Reasons For Using Credit Cards

Respondents are asked to rank reasons for using credit card. Based on the ranks that the respondents awarded, the
researcher has found the number of responses placed in each rank. Using Garrett Ranking Technique, the researcher
has computed the Garrett score and allotted ranks accordingly. Table 4 demonstrates the result.

Table 4:- Reasons for Using Credit Cards

S.No Reasons Garret Score Garret Rank
1 Benefit of extended payment period 8002 2
2 Benefit of converting purchase in to EMI 7811 4
3 Benefit of Reward points or cash back. 8545 1
4 Benefit of taking loan on card 7849 3
5 Low charge 6920 5
6 Avoid cash dealing 6661 7
7 Easy to carry and make payment 6862 6
Source: Computed Data
Table 4 upshot that Benefit of reward points or cash back got the first rank with a maximum score of 8545; Benefit
of extended payment period secured second rank with the score of 8002 and Avoid cash dealing occupied last rank
with the minimum score of 6661.

Personal Profile And Level Of Satisfaction Of Customers Towards Credit Cards

Seven statements are framed to obtain level of satisfaction of customers towards credit card. Likert’s five point
scaling techniques has been used to determine the level of satisfaction. Table exhibited the number of respondents
under various level of agreement towards the statements.

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Table 5:- Level of Satisfaction.

S.No Particulars No. of Respondents Mean Std
SA A N DA SDA Deviation
1 Credit cards provide more convenience and wide 18 35 45 28 24 2.97 1.24
acceptance
2. Interest rate and other charges on credit card is 15 33 34 27 41 2.69 1.35
reasonable
3. Comfortable to pay electrically/ telephone/ utility bills 45 29 37 25 14 3.44 1.32
4. Credit limit on credit card is adequate 25 17 17 40 51 2.5 1.47
5. Banks attend to credit card queries promptly 28 22 25 45 30 2.8 1.40
6. Grievances of credit card holders settled satisfactorily 35 28 34 33 14 3.33 1.33
7. Knowing your spending Patten by way of regular 38 33 23 34 22 3.21 1.42
updated monthly bills
Source: Primary Data
Note: SA- Strongly Agree; A- Agree; N-Neutral; DA-Disagree; SDA-Strongly Disagree

The average score of Comfortable to pay electrically/ telephone/ utility bills(3.44), Grievances of credit card
holders settled satisfactorily(3.33) and Knowing your spending Patten by way of regular updated monthly bills(3.21)
is above three. It reveals that except these three statements, all the other statements are not agreed by the majority of
the respondents.

Chi Square Test:-

The level of agreement of the respondents towards credit card has been classified into three categories viz., low level,
medium level and high level.

The level of satisfaction has been derived from the mean score value of the 150 respondents. The calculated value of
X and S.D. are 20.95 and 3.51 respectively. Therefore,
X + S.D = 20.95+3.51 = 25 and above – High Level
X - S.D = 20.95-3.51 = 17 and below - Low Level
( X + S.D) to ( X - S.D) = 17 to 25 – Medium Level

In order to analyse the relationship between demographic profile of the respondents and their level of satisfaction
towards credit cards, chi-square test has been employed. The calculated value of chi square is compared with the
table value of chi square at 5% level of significance. If the calculated value of chi square test is more than the table
value, the null hypothesis is rejected and vice versa.

Hypothesis Testing 1:-

H01: There exists no significant difference between the Gender and the level of satisfaction towards credit card
services. Here Chi-Square test is used as a tool to test it.

Table 6:- Gender and Level of Satisfaction of the Respondents.

Gender Level of Satisfaction Total
High Medium Low
Male 28(26.0) 44(45.0) 23(24.1) 95(95.0)
Female 13(15.0) 27(26.0) 15(13.9) 55(55.0)
Total 41(41.0) 71(71.0) 38(38.0) 150(150.0)
Chi-square Computed Value DF p value
0.620 2 0.734
Source: Computed Data; Figures within the parenthesis represent expected frequency

As p>0.05, the null hypothesis is accepted at 5% level of significance. Hence, it is concluded that the level of
satisfaction of the respondents towards credit card does not vary with gender.

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Hypothesis Testing 2:-

H02: There exists no significant difference between the Age and the level of satisfaction towards credit card
services. Here Chi-Square test is used as a tool to test it.

Table 7:- Age and Level of Satisfaction of the Respondents.

Age (in years) Level of Satisfaction Total
High Medium Low
Below 30 9(8.4) 18(15.6) 6(9) 33(33.0)
30-40 21(16.5) 28(30.8) 16(17.8) 65(65.0)
41-50 5(9.4) 14(17.5) 18(10.1) 37(37.0)
Above 50 3(3.8) 11(7.1) 1(4.1) 15(15.0)
Total 38(38.0) 71(71.0) 41(41.0) 150(150.0)
Chi-square Computed Value DF p value
16.645 6 0.011
Source: Computed Data; Figures within the parenthesis represent expected frequency

As p<0.05, the null hypothesis is rejected at 5% level of significance. Hence, it is concluded that the level of
satisfaction of the respondents towards credit card vary with age of the respondents.

Hypothesis Testing 3:-

H03: There exists no significant difference between the Marital Status and the level of satisfaction towards credit
card services. Here Chi-Square test is used as a tool to test it.

Table 8:- Marital Status and Level of Satisfaction of the Respondents.

Marital Status Level of Satisfaction Total
High Medium Low
Married 28(26.6) 50(49.7) 27(28.7) 105(105.0)
Unmarried 10(11.4) 21(21.3) 14(12.3) 45(45.0)
Total 38(38.0) 71(71.00) 41(41.00) 150(150.0)
Chi-square Computed Value DF p value
0.587 2 0.746
Source: Computed Data; Figures within the parenthesis represent expected frequency

As p>0.05, the null hypothesis is accepted at 5% level of significance. Hence, it is concluded that the level of
satisfaction of the respondents towards credit card does not vary with marital status of the respondents.

Hypothesis Testing 4:-

H04: There exists no significant difference between the occupation and the level of satisfaction towards credit card
services. Here Chi-Square test is used as a tool to test it.

Table 9:- Occupation and Level of Satisfaction of the Respondents.

Occupation Level of Satisfaction Total
High Medium Low
Businessman 15(12.7) 18(23.7) 17(13.7) 50(50.0)
Private Employee 11(10.6) 22(19.9) 9(11.5) 42(42.0)
Government Employee 1(5.1) 13(9.5) 6(5.5) 20(20.0)
Professionals 4(4.6) 9(8.5) 5(4.9) 18(18.0)
Housewives 7(5.1) 9(9.5) 4(5.5) 20(20.0)
Total 38(38.0) 71(71.0) 41(41.0) 150(150.0)
Chi-square Computed Value DF p value
9.260 8 0.321
Source: Computed Data; Figures within the parenthesis represent expected frequency

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As p>0.05, the null hypothesis is accepted at 5% level of significance. Hence, it is concluded that the level of
satisfaction of the respondents towards credit card does not vary with occupation of the respondents

Hypothesis Testing 5:-

H05: There exists no significant difference between the income and the level of satisfaction towards credit card
services. Here Chi-Square test is used as a tool to test it.

Table 10:- Income and Level of Satisfaction of the Respondents.

Age (in years) Level of Satisfaction Total
High Medium Low
Less than Rs.5000 10(8.4) 13(15.6) 10(9.0) 33(33.0)
Rs.5000 to Rs.10000 8(8.9) 19(16.6) 8(9.6) 35(35.0)
Rs.10001 to Rs.15000 9(11.9) 23(22.2) 15(12.8) 47(47.0)
More than Rs.15000 11(8.9) 16(16.6) 8(9.6) 35(35.0)
Total 38(38.0) 71(71.0) 41(41.0) 150(150.0)
Chi-square Computed Value DF P value
3.452 6 0.750
Source: Computed Data; Figures within the parenthesis represent expected frequency

As p>0.05, the null hypothesis is accepted at 5% level of significance. Hence, it is concluded that the level of
satisfaction of the respondents towards credit card does vary with income level.

Suggestions:-
 Credit limit amount allowed by bank may be extended to certain extent to the deserving Credit card holders.
 Reduction of minimum eligibility criteria will attract the customers to obtain Credit Cards.
 Charges for the credit cards should be nominal.
 Awareness must be created about special offer available for maximum usage of credit cards.

Conclusion:-
Customer satisfaction in e-environment is determined by the website of the bank, efficiency of the bank,
competency of the bank and information provided by the bank. Due to the complexity in the usage of credit cards, it
is necessary to make the customers to know how to operate the credit cards for specific purpose. In order to facilitate
the customers to carry the cards with them, effective protective measures must be taken to protect the cards against
operational and security risk.

References:-
1. Dangwal RC, Kailash Sakalani and Swathi Anand (2010), E – Banking, Professional Banker, Jan – 2010, PP
No. 26 – 33.
2. Manas Ratha (1997), The Credit Card Model, MIT System, Dynamics in Education Project, June 16 – 1997, PP
No. 01- 33, (MIT – Massachusetts Institute of Technology).
3. Narindra Kumar Bhasin(2009), “Technology and Payment System” , The Journal of Indian Institute of
Banking and Finance,80,17-21.
4. Ramalingam P (2009), Usage Pattern of Credit Card Holders, Indian Journal of Finance, April 2009 – 7, PP No.
07 – 14.
5. Dr.S.Sudhagar(2012) , “ A Study on Perception and Awareness on Credit Cards among Bank Customers in
Krishnagiri District”, IOSR Journal of Business and Management (IOSRJBM) ISSN: 2278-487X Volume 2,
Issue 3 ,14-23.

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