Home Loans: Customer Satisfaction and Service QualityUnder Guidance of: Click to edit Master subtitle style Dr. Kavita Sharma Professor Delhi School of Economics Dept. of Commerce and Business University of Delhi

Submitted by: 4/21/12 Gaurav Verma

Objective To study the trend and growth in home loan industry in

India. To identify the service quality parameters in home loan

industry. To identify the relative importance of factors affecting the

home loans.

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Indian housing finance structure

4/21/12 Source: ICRA Report: Housing Finance Companies and The Indian

4/21/12 ICRA Report: Housing Finance Companies and The Indian Source:

4/21/12 Source: ICRA Report: Housing Finance Companies and The Indian

SERVICE QUALITY Parasuraman et al. defined service quality as the global

evaluation or attitude of overall excellence of services. So service quality is the difference between customers expectation and perceptions of service delivery by service firms. Nitecki et al. defined service quality in terms of meeting or exceeding customer expectations, or as the difference between customer perceptions and expectations of service

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SERVICE QUALITY DIMENSIONS Reliability Responsiveness Assurance Empathy Tangibles

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CUSTOMER SATISFACTION Kotler defined customer satisfaction as the level of persons

felt state resulting from comparing a products perceived performance or outcome in violation to his own expectations. So customer satisfaction could be considered a comparative behaviour between inputs beforehand and post obtainments.

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RATING PARAMETERS FOR HOUSING LOANS Borrowers age Stability of Income Educational Qualification Proof of Income Marital Statusof Property Marketability Mobility Value Ratio Location Loan to of Individual Number of to Loan Ratio Net Worth Dependants Number of Joint Applicants Net Annual Income of the Borrower Employer Type to Income Ratio Fixed Obligation Designation Net worth to Loan Ratio Guarantors

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Research methodology Secondary research Primary researchAge of Respondents Number of Respondents 21-30 31-40 41-50 51-60 Above 60 4/21/12 18 2 6 3 1 Sample size- 30 respondents

Percentage of Respondents 50% 6.67% 20% 20% 3.33%

ASSESSMENT OF RESPONSESParticular Important Very Important Most Important Frequency 1 10 19 Percentage 3.33% 33.33% 63.33%

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Particular Not Important Important Very Important

Frequency 5 14 11

Percentage 16.66% 46.67% 36.66%

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Particular Not Important

Frequency 5 10 14 1

Percentage 16.67% 33.33% 46.67% 3.33%

Important Very Important Most Important

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Particular Not Relevant Not Important Important

Frequency 7 11 12

Percentage 23.33% 36.67% 40%

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Particular Not Relevant Not Important Important Very Important Most Important

Frequency 2 5 9 11 3

Percentage 6.67% 16.67% 30% 36.67% 10%

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Particular Not Relevant Not Important Important Very Important

Frequency 7 13 8 2

Percentage 23.33% 43.33% 26.67% 6.67%

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Particular Not Important Important Very Important

Frequency 5 12 13

Percentage 16.67% 40% 43.33%

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Particular Not Relevant Not Important Important Very Important

Frequency 2 4 20 4

Percentage 6.67% 13.33% 66.67% 13.33%

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Particular Not Relevant Not Important Important Very Important

Frequency 3 3 14 10

Percentage 10% 10% 46.67% 33.33%

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Particular Not Relevant Not Important Important Very Important

Frequency 3 7 17 3

Percentage 10% 23.33% 56.67% 10%

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ParametersInterest Rate Pay Back Period Flexibility Disbursement Time Miscellaneous Expenses Late payment charges Customer relations Employee Courtesy and Staff Training Reputation of Banking Institution Physical ambience 4/21/12

Total Score Average 138 4.6 96 3.2 91 3.03 101 3.36 98 3.27 65 2.17 86 2.86 80 2.67 98 3.27 75 2.50

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Instructions: The responses will be used strictly for the academic purpose. Your response will be kept secret.

Kindly give your opinion on the scale measuring the level of importance of each factor in your decision about Personal information: purchasing a home loan.Name ________________________ Age _________ Gender _____________ Monthly Income __________________________

Factor Not relevant Interest rate Payback period Employee courtesy and staff training Disbursement period Late payment charges Reputation of banking institutions Physical ambience of bank branches Customer relations Flexibility in bank norms Miscellaneous expenses Not Important

Importance scale Important Very Important Most Important

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