International Journal of Management (IJM)

Volume 11, Issue 11, November 2020, pp. 2586-2596. Article ID: IJM_11_11_243
Available online at http://iaeme.com/Home/issue/IJM?Volume=11&Issue=11
Journal Impact Factor (2020): 10.1471 (Calculated by GISI) www.jifactor.com
ISSN Print: 0976-6502 and ISSN Online: 0976-6510
DOI: 10.34218/IJM.11.11.2020.243

© IAEME Publication Scopus Indexed

ANALYSIS OF CUSTOMER BEHAVIOUR IN

BANKING SECTOR WITH SPECIAL
REFERENCE TO VIRUDHUNAGAR DISTRICT
J. Srinivasan
Ph.D. Scholar, Sri S. Ramasamy Naidu Memorial College,
Sattur, Tamilnadu, India

Dr. S. Arumugasamy
Guide and Supervisor, Associate Professor,
Sri S. Ramasamy Naidu Memorial College,
Sattur, Tamilnadu, India

Dr. M. Selvakumar
Co Guide, Head and Assistant Professor,
Ayya Nadar Janaki Ammal College,
Sivakasi, Tamilnadu, India

ABSTRACT
The research's objective is to learn the customer behavior towards the standard of
banking products and services in the opinion of customer preferences Quality of service
is examined on several distinctive from self-sufficiency or service reliability is measured
in various forms. An attempt is often made to discover which service attributes could
improve customer opinion of banking services efficiently. An attempt is often made to
discover which service attributes could improve customer opinion of banking services.
Potential respondents with random sampling are selected from a wide range of
demographics characteristics. Banks both from the private and public sectors are
sampled. Research questionnaires have been distributed to 400 clients of various banks
in the Virudhunagar district. The data were analyzed using simple percentage, Chi-
square measure, and AMOS. Customer opinion seems to represent customer behavior
when it comes to banking services and products, according to the findings. The banking
sector is the largest in the Virudhunagar district which has seen exponential
development and strong rivalry throughout the last generation. This research was
indeed primarily undertaken to investigate this trend and to pursue evidential reasoning
throughout this context by recognizing the opinion of the customer as the key
contributor to the behavior of the customer in banking services and products.

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 Analysis of Customer Behaviour in Banking Sector with Special Reference to Virudhunagar District

Key words: Banking Sector, Customer Satisfaction, Service Quality, Banking Products
Cite this Article: J. Srinivasan, Dr. S. Arumugasamy, Dr. M. Selvakumar, Analysis of
Customer Behaviour in Banking Sector with Special Reference to Virudhunagar District.
International Journal of Management, 11(11), 2020, pp 2586-2596.
http://iaeme.com/Home/issue/IJM?Volume=11&Issue=11

1. INTRODUCTION
The banking sector performs a crucial position in the economic development of every nation
by supplying financial resources in the financial area [6]. In the Virudhunagar district, the
banking industry has developed rapid development over the last century, exploring different
product perspectives and introducing several new innovative services into Virudhunagar
district. Over the last decade, the rising popularity of banks operating in the Virudhunagar
district has penetrated the banking sector into a turbulent environment where almost every bank
is seeking to obtain full market share. Throughout the run-up to the full share of the market,
banks have faced a significant challenge to the quality of service and have been striving to
deliver the highest service quality for the last several years [4]. At first, banks did not have a
service mindset, however owing to exponential development and innovation of banking
systems, the definition of customer services has evolved and customer-centered methods are
already in effect to keep consumers ever [7].
Bank now revealed the nature worth of the customer and has put in place customer-driven
facilities in the Virudhunagar district for commitment and involvement. Banks can contend
against competitors in financial goods, providing versatile schedules, lower borrowing interest
rates, and good returns on deposits, however providing better customer services is a strategic
benefit for those banks who provide the highest quality of service and items, since customers
are already well informed of their privileges and everybody needs to receive the excellent
outcomes from their banks [6]. Responding to customers' demands in return for the money they
charge and maintain a competitive advantage is merely a real task for Virudhunagar bankers,
as customers understand through their experiences and as their quality of service preferences
declines, customer loyalty is affected. Researches further show that strong satisfaction of the
customer also contributes to a higher financial performance of the company. Quality of service
is thus considered in the studies as a key building block of customer satisfaction and is the
customer satisfaction that influences the effectiveness and efficiency of every organization [10].
From this point of view, the opinion of consumers about the efficiency of banking services
is quite important[8]. The objective of this research was true to assess the service attitude of
Virudhunagar banks by enhancing banking products and services. A strategy that presents a
true image of the level of service as viewed by customers. This analysis showed the connection
between the opinion of the customer on banking products and the opinion of the customer on
bank services. The findings are relevant for Virudhunagar banks to strengthen their quality of
service strategies and to develop stronger service norms.

2. RELATED WORKS
In [1] the authors forecast the goal of this paper is to evaluate the effect of Self Service
Technologies (SST) on cross-purchase and part of speech. They intended to discover the cross-
buying effects and words out-of-mouth effect of performance expectancy. Besides, the whole
analysis also examines the mediator variable function of online service efficiency in the
relationships referred to above. The research was conducted in the scope of retail banking in
the competitive environment, India. The cross-sectional sampling procedure has been used to
gather data from 235 retail banking customers in India. The statistical analyses were performed
using Structural Equation Modeling (SEM) methodology to determine the relationships that

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 J. Srinivasan, Dr. S. Arumugasamy, Dr. M. Selvakumar

were suggested by IBM AMOS 23.0. They concluded that word out-of-mouth was fundamental
as well as perceived utility, or easy-of-of-use of cross-selling. Online service efficiency partly
mediates the interaction between perceived cross-purchase and word-of-mouth utility. Online
service efficiency partly underlies the link between trust convenience use and cross-purchase,
and therefore may not formalize the link between trust convenience use and word-of-mouth.
The above research suggested that employees would do well to rely on user satisfaction and
presumed user acceptance in terms of maintaining cross-purchase and encourage consumer
word-of-mouth suggestions. Employees would also be willing to improve cross-purchase and
encourage word-of-mouth reviews if the level of online service provided by the bank is
considered to be successful for consumers. This research extends to the SST literature and
provides observational data to demonstrate that facilitating condition and behavioral intention
may affect both cross-purchase and word-of-mouth. Past experiments have demonstrated that
the use of SST can promote commitment, and the current review brings different examples of
assurance process implications. The analysis was carried out in response to retail account
holders in the developing sector. This research also leads to the SST literature by evaluating the
influencing impact of online service efficiency for the above-described relationships [5].
In [2] the authors examined the current technological era, creativity, relentless evolution as
the banking sector's only hope of success at keeping customers satisfied. If a business wants to
keep its customers, it must always strive to have better support and provide outstanding results.
A shortage of financial and customer research has led the researchers to pursue an investigation
into the link between customer satisfaction and their financial results. Further, the research
looks at whether customer satisfaction has some effect on the service qualities. According to
the study, both secondary and primary data are needed to conclude. 356 survey questions were
carried out in customer to evaluate customer service efficiency and profits for the chosen
Islamic banks, and financial details were collected mostly from financial reports. Additionally,
the SERVQUAL strategy incorporates the five factors (verifiability, competency, knowledge,
support, receptivity, and attentiveness) to classify Bangladeshi Islamic Banking based on their
service efficiency. The research takes a wide range of sophisticated mathematical approaches
to validate the theory, which includes reliability analysis and exploratory factor research. It sees
a direct link between the standard of operation, compassion, durability, and customer
satisfaction. The research also was unable to discover any meaningful correlation between the
profitability of Bangladeshi Islamic Banks and customer satisfaction. The conclusions suggest
that customer satisfaction plays a much less significant role in banking results in Bangladesh
than financial or market growth.
In [3] the authors analyzed a recent significant industry theme in the Information-Systems
(IS) area that has been termed 'mobile banking apps. In this paradigm, the commercial financial
sector has shifted from branches to smartphones, and it has achieved widespread usage [10].
The objective of this study was to try and address the critical role of mobile banking apps in the
Jordanian banking field. A self-administered survey was applied to 300 customers from 3
financial institutions in Jordan. Even though there are no statistically relevant variations
between customers' and non-bank customers, their findings show that mobile banking is
accessible to the majority of the population. Consequently, there were a few trends that could
be seen among mobile app customers as brand personality, styles of leadership, household
issues, wellness awareness, and free-spirited behavior influenced the movement of the group
but did not concern mobile banking apps. A range of suggestions is extracted from the results.

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 Analysis of Customer Behaviour in Banking Sector with Special Reference to Virudhunagar District

3. STATEMENT OF THE PROBLEM

The performance of bank sectors is of paramount importance to customer satisfaction, but
banks' capacity to enhance banking products and their services slow down. The index of
customer experience was lowered. When market executives from the banking sector fail to
grasp what kind of products and services they should be promoting to satisfy consumers and
clients, they sometimes make mistakes. The biggest challenge here is that few sections of the
banking sector have little idea how to go about rising quality of service.

4. RESEARCH DESIGN
The information was therefore divided into 2 major groups secondary and primary data. The
secondary information was collected in newspapers, publications, mags, the internet as well as
study articles. The primary information has been obtained with an experimental evaluation – A
set of questions were spread among all the non-user and users of banking the resources
generally entrepreneurs, service personnel, experts, undergraduates, etc. Different products of
the bank offerings like ATM, credit and debit cards, e-banking, banking through mobile phone,
and loan facilities.

5. OBJECTIVES OF THE STUDY

• To Study the Relationship between customer opinion towards Banking Products and customer
Opinion towards Banking Services.
• To find out how customer Opinion reflects customer behavior towards banking products.

6. BANKING PRODUCTS AND SERVICE

(i) Checking-Account
An account statement checking would be the main aspect that customers thought on when they
thought about which services the banks provide. customers can hold and control the cash they
are using for daily expenses with this traditional platform of account. They might use the ATM
card or check to pay for all items, from foodstuffs to petrol and utilities, which would draw
funds immediately from their account. They also may take money from a debit card and PIN
via an ATM or branch, a special password that they have selected to secure their account.

(ii) Savings-Account
Customers could split the funds from either the cash they need to pay through a savings account.
With most, it is an easy way to achieve a target, such as saving for improved housing or
preparing an unexpected expense. While many savings accounts will simply transfer funds to
their savings plan per month from their checking account, then they wouldn't have to worry
about this anymore. An extra advantage is that banks normally offer the savings deposits
interest. This is free cash that will motivate customers quicker to meet their financial objectives.

(iii) Money-Market-Account (MMA)

An MMA is little more than a savings plan that also offers more interest rates than a traditional
savings account. The further customer's transfer, the further they can gain. Although consider
that mostly because federal legislation can allow up to 6 deductions a month.

(iv) Certificate-of-Deposit (CD)

A CD is a kind of bank account where, for a period of 6 months to 5 years, the customers
consent to hold money in the account. That matter how long the actual customer invests, the
bigger the profits. They should still choose for early withdrawal. Even so, by the expiration of
their CD period, they have to withdraw.

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 J. Srinivasan, Dr. S. Arumugasamy, Dr. M. Selvakumar

(v) Debit-Card
They could compensate for monthly needs by simply swipe with a debit card. The funds come
from one's bank account and therefore they don't have to bring cash if they don't want it. Or
sometimes, they will not be liable for fraudulent charges if their debit card is misplaced or
robbed if they record it at moment. Missing cash is generally lost for sure.

(vi) Credit-Card
The customers can pay with a credit line for products by credit card. Essentially, as the bill
arrives, they borrow and only pay it back. Just keep in mind how various credit cards set
ridiculous fees, so they have to consider what they commit to (so they don't spend very much
over the longer term). Some payment of the bill is one means of avoiding interest charges
annually. They might still choose to pay monthly charges, particularly whether it is a frequent
flyer mile card or cashback offers. Credit card buying around without annual charges is still a
choice.

(vii) Automated-Teller-Machine (ATM)

An ATM is an e-banking that enables customers to carry out simple payments without even a
branch or a bank statement. The debit card and safe PIN are only essential for them. Most ATMs
often permit money or cheques to be deposited. They will need to pay a charge for using other
banks, even if they may not want to be using the ATM to control the cash. Most credit cards
often facilitate cash withdraws, but a heavy charge will be paid on this "cash-advance" so just
be desperate to check out in advance.

(viii) Federal-Deposit-Insurance-Corporation (FDIC)

If customers do have capital in an FDI bank, they would realize that it is healthy and safe to
accept restrictions. This occurs in the extremely unlikely case a bank collapses, the US govt is
covering FDIC insured deposits. The Bank Find method helps to verify whether a certain bank
is an affiliate and to seek the highest cap for protected deposited funds.

(ix) Deposits
The customers can deposit if they move to cash in the bank. In general, the branch or cash
deposit machines will deposit cash and cheques. The transfer shall be made as their salary is
immediately moved on payday from their boss to their paycheck or investment account, which
could save their time.

(x) Withdrawal
They make a release if they withdraw funds from the deposit. They can collect funds at a local
bank or ATM-like they go for deposits. They immediately remove the cash from their account
when they write a cheque, wire-money, or use their debit card.

(xi) Fees
Fees differ greatly whenever it goes to various forms of banking items. However, fee-less
accounts and programs that are likely to meet the client's requirements can also be found.
Regular charges for certain banking facilities include recurring repair charges, overdraft
charges, and ATM rates. If users don't want to spend more, browsing and contrasting deals
could be worthwhile.

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 Analysis of Customer Behaviour in Banking Sector with Special Reference to Virudhunagar District

7. ANALYSIS AND INTERPRETATION

The data collection procedures have been examined with the SPSS tools. The tools can be used
to experiment with the hypothesis:
1) Percentage Analysis
2) Chi-square Analysis
3) AMOS
This research contains secondary and primary details. Secondary information was collected
from newspapers and online sites. For the primary data collection, well-crafted questioning
plans are used. The banks of Virudhunagar district are selected for this research.

7.1. Percentage Analysis

The demographic variables like age, educational status, qualification, employment status,
occupation, unemployed status, and area are used for this study.

Table 1 Age of the Respondents

S.No Particular No.of Respondent Percentage
1. Below 20 Years 42 10.50
2. 20 Years - 25 Years 114 28.50
3. 25 Years - 30 Years 110 27.50
4. 30 Years - 35 Years 82 20.50
5. Above 35 Years 52 13.00
Total 400 100.00

AGE OF THE RESPONDENTS

28.5 27.5
30

25 20.5
20
13
15 10.5
10

0
Below 20 20 Years - 25 25 Years - 30 30 Years - 35 Above 35
Years Years Years Years Years

Figure 1 Age of the Respondents

It could be seen from Table 1 and Figure 1 that 10.5% of the respondents are in the age
group of fewer than 20 years, 28.5% of the respondents are in the age group between 20 – 25
years, 27.5% of the respondents are in the age group between 25 – 30 years, 20.5% of the
respondents are in the age group between 30 – 35 years and 13% of the respondents are in the
age group of above 35 years.

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 J. Srinivasan, Dr. S. Arumugasamy, Dr. M. Selvakumar

Table 2 Educational Status of the Respondents

S.No Particular No.of Respondents Percentage
1. Literate 297 74.20
2. Illiterate 103 25.80
Total 400 100.00

EDUCATIONAL STATUS OF THE RESPONDENTS

80
70
60
50
40
30
20
10
0
Literate Illiterate

Figure 2 Educational Status of the Respondents

It could be seen from Table 2 and Figure 2 that 74.3% of the respondents are literates, and
25.8% of the respondents are illiterates.

Table 3 Employment Status of the Respondents

S.No Particular No.of Respondents Percentage
1. Employed 316 79.00
2. Unemployed 84 21.00
Total 400 100.00

It could be seen from Table 3 and Figure 3 that 79.0% of the respondents were employed,
and 21.0% of the respondents were unemployed.

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 Analysis of Customer Behaviour in Banking Sector with Special Reference to Virudhunagar District

EMPLOYMENT STATUS OF THE RESPONDENTS

80
70
60
50
40
30
20
10
0
Employed Unemployed

Figure 3 Employment Status of the Respondents

Table 4 Area of the Respondents

S.No Particular No.of Respondents Percentage
1. Urban 154 38.50
2. Rural 181 45.20
3. Semi Urban 65 16.30
Total 400 100.00

AREA OF THE RESPONDENTS

50
45
40
35
30
25
20
15
10
5
0
Urban Rural Semi Urban

Figure 4 Area of the Respondents

It could be seen from Table 4 and Figure 4 that 38.5% of the respondents belong to the
urban category, 45.3% of the respondents belong to the rural category, 16.3% of the respondents
belong to the semi-urban category.

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 J. Srinivasan, Dr. S. Arumugasamy, Dr. M. Selvakumar

Table 5 Level of Customer Opinion towards Banking Product

Level of Customer Opinion Towards
Level of Customer Opinion
S. No Banking Services Total
Towards Banking Product
Excellent Good Fair
66 0 27 93
1. Excellent
(16.50%) (0%) (6.75%) (23.25%)
0 26 7 33
2. Good
(0%) (6.50%) (1.75%) (8.25%)
26 85 163 274
3. Fair
(6.50%) (21.25%) (40.75%) (68.50%)
92 111 197 400
Total
(23.00%) (27.75%) (49.25%) (100.00%)

7.2. Chi-Square Analysis

This assessment tests how well a model relates to real results found. This evaluation is based
on testing. The information used to calculate chi-square statistics must be arbitrary, real,
mutually exclusive, taken from independent variables but also taken from a sufficient survey.
For eg, these conditions are met by the effects of a fair mark. Hypothesis checking also requires
chi-square methods. Due to the size and amount of variables in the relation, the chi-square
statistics compare the size of any discrepancies between results predicted and actual results.

Table 6 Chi-Square Analysis

Chi-Square Tests For Customer Opinion towards Banking Product and Customer Opinion
Towards Services
Asymp. Sig. (2-
Value Df
sided)
Pearson Chi-Square 199.033 a 4 .000
Likelihood Ratio 197.145 4 .000
Linear-by-Linear Association 88.376 1 .000
N of Valid Cases 400
From Table 6, it is inferred that the significance value is 0.000 and hence the null hypothesis
is rejected and the alternate hypothesis is accepted which says that “there is a significant
relationship among customer opinion towards banking product and customer opinion towards
banking services”.

7.3. AMOS
AMOS is programmed for the mathematical study of the structures for a moment. It is also an
additional SPSS component and is used particularly for SEM and analysis of path. It may also
be called covariance analysis or causal computer modeling.

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 Analysis of Customer Behaviour in Banking Sector with Special Reference to Virudhunagar District

Figure 5 AMOS Output

Figure 5 represent that both the Customer opinion of banking services and banking products
has the same estimated value as 0.07 and hence it is proved that the customer opinion reflects
the customer behavior towards banking products and the CMIN of the above diagram is 2.72
which is lower than CMIN (P-Value of <3) which shows the framed CFA was Perfectly Fit.

8. CONCLUSION
In dynamic global banks today, better offerings may be provided to their customers to achieve
a competitive edge. In terms of services and products, most branches of Indian banks are not
quite diversified. The main primary focus for banks to stay successful could be to attract the
highest potential amount of customers. The retention of customers is achievable through an
opinion by the customers on banking products and services. Therefore, in today's dynamic
world customer satisfaction is the secret to growth. This current research emphasizes the
customers' degree of satisfaction with Virudhunagar's banking services. Taking into account
the demographic considerations of age, school skills, job position, and region of 400
respondents, its final results have been received and it indicates that a moderate degree of
customer satisfaction exists. Such adverse aspects such as online transfers, interest rates for
credit, A.T.M. services, etc. have also been outlined. Maybe and that is why the management
team was also given some suggestions such as an emphasis on online resources, a quick-time
solution to the bank problem, and the promotion of term loans like industry, company, farming,
etc.

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 J. Srinivasan, Dr. S. Arumugasamy, Dr. M. Selvakumar

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