Customer Satisfaction of ATM Services

8/11/2019 Customer Satisfaction of ATM Services

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Customer Satisfaction of ATM Service: A Case Study of HSBC ATM

Dr. Md. Rafiqul Islam

Dr. Samir Kumar Sheel

Pallab Kumar Biswas

Abstract:

The Automated Teller Machine (ATM) is one type of innovation that can mechanicallyaccept deposits, issue withdrawals, transfer funds between accounts, collect bills, and

make small loans. This study aims at investigating the satisfaction levels of HSBC ATMcardholders (both staff and nonstaff) with respect to various aspects (promptness of carddelivery, the performance of HSBC ATM, the service quality of ATM personnel etc.) of

using HSBC ATM and their opinions on various other related issues (such as positive andinconvenient features of HSBC ATM, recommendation to improve the service qualityetc.). This study is one type of exploratory research using convenience samplingtechnique where samples have been selected on the basis of convenience. Thus, projecting

data beyond the sample is statistically inappropriate. This study only providesinformation for analyzing ATM scenario of HSBC. Though the samples were selected ona convenience basis and it may not represent the whole population, but still it is no less

important for the HSBC management to consider the recommendations with due care forbetter customer service and for being in a better competitive position.

Keywords: ATM card, Machine breakdown, Unsuitable location, currency quality.

1.0 Introduction

1.1 Background of the Study:

Technology is revolutionizing the financial services industry through various unthinkableinnovations. The volume of cross-border trading and other financial activities is increasinggeometrically facilitated by technology. The influence of technology over product innovations inbanks is enormous. In innovation process banks have to decide which products they wish to sell,whether they wish to build those products themselves, how they should deliver, and why theywish to deliver them to customers (Raihan 2001). Innovation is the art of overcoming constraintstoward development. It occurs when a new or changed product or service is introduced to themarket, or when a new or changed process is used in a commercial situation. No organization canremain happy with the existing products to cope with the competitors. Banks are no exception tothis situation (Shahid 2004). The Automated Teller Machine (ATM) is such type of innovationthat can mechanically accept deposits, issue withdrawals, transfer funds between accounts, collectbills, and make small loans. HSBC is one of the leading organizations in the modern financialworld. . It started its operation in Bangladesh in 1996. Since then, it is their strategic decision to

bring all modern technologies such as ATM, Easy Pay Machine etc. in banking in Bangladesh.This decision was to keep them in the market in a superior position competing in the marketproviding better services with various alternative channels 24 hours-a-day, and 7 days-a-week.The growth rate of HSBC ATM users are shown in the following table:

Table 1: Growth rate of HSBC ATM users

Particulars July 2000 July 2001 July 2002 July 2003 July 2004 July 2005

Growth rate - 240.65% 98.37% 36.67% 42.36% 27.67%

*Dr. Md. Rafiqul Islam and Dr. Samir Kumar Sheel are Associate Professors, Department of Marketing,

University of Dhaka, and Pallab Kumar Biswas is a Lecturer, Faculty of Business Administration,Eastern University.


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The above table shows that the use of HSBC ATM is increasing day by day. So it is high time toinvestigate how the customers feel with the HSBC ATM, what are their newer demands etc.

1.2 Statement of the Problem and Objectives of the Study:

Commercial banking is considered as a service industry. In the process of conducting its ownactivities to achieve its own goals, i.e. making profit, a commercial bank provides variousancillary facilities (Ghosh 1981). Automated Teller Machine (ATM) is such an ancillary facility.ATM is a part of the electronic financial transactions systems. In Bangladesh, different banks arenow offering ATM cards to their valued customers. The Hongkong and Shanghai BankingCorporation Limited (HSBC) also introduced the ATM facility in 1999. Different studies havebeen conducted by the internal management of this bank to have an idea about customersatisfaction about various banking products of HSBC, but no study has been undertaken toidentify the level of customer satisfaction with respect of various aspects of HSBC ATM. But asday-by-day the use of ATM is increasing, it is important to make a study to gain insight about thelevel of customer satisfaction with respect to various aspects of HSBC ATM and to identify theproblem areas and proposed recommendation leading to improvement. This study is such an

attempt.

The main objectives of the study can be stated as below:(a) To examine the level of nonstaff customer satisfaction associated with various aspects

of HSBC ATM (such as promptness of card delivery, the performance of HSBCATM, the service quality of ATM personnel etc.);

(b) To examine the level of staff customer satisfaction associated with various aspects ofHSBC ATM; and

(c) To make policy recommendations to improve the service quality of HSBC ATM.

1.3 Rationale of the Study:

The findings of the study will provide information to use in analyzing the current ATM situationof HSBC. As the use of ATM services is increasing day-by-day, on the part of the bank, it isimportant to have an idea about what the ATM users are thinking about various features of ATM,what are their problem areas, what are their recommendations, how do they compare the ATMservice of this bank with that of any other banks etc. The banks marketing department also needsto have idea about the results of such types of study to determine appropriate marketing strategy.Thus the findings of the study will be very useful to them and it will also help the ATM section toidentify their positive and negative features and the customer recommendation. The bankmanagement can take actions on the basis of customer recommendations to improve the servicesand further growth assuming that the customers selected on the basis of convenience represent thewhole population.

1.4 Limitations of the Study:

In undertaking the study, a number of problems were faced. Thus the study has severallimitations. The limitations are:

(a) The survey conducted for the study is one type of exploratory research. So it does notprovide conclusive evidence. Subsequent research will be required to provide conclusiveevidence.

(b) In this study because of acute time shortage and organizational restriction, nonprobabilitysampling technique (convenience sampling) has been used. So it is inappropriate to projectthe results of the survey beyond the specific sample.

(c) In this study detailed classification of respondents could not be done. Each respondentmight have been classified on the basis of their Age, Educational Background;Experience; Nature of profession; Types of Business; Sex; Status; etc. Analysismay be diversified done on the basis of this classification.


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(d) As the sample size is very small, geographical and regional differences could not be made.(e) Because of time constraint, this study includes only Dhanmondi CSC and Uttara CSC other

than head office ATM.

2.0 Methodology of the Study

2.1 Population and Sample:

As a case study, the study covers only the HSBC. The population defined for this study waslimited to the ATM users of HSBC and the Staff ATM users of HSBC head office. Thepopulation represents all the HSBC ATM users. In this studyconvenience sampling techniquehasbeen used. On the basis of convenience, 57 nonstaff ATM users and 42 staff ATM users wereselected.

2.2 Database and Procedure of Analysis:

Both primary and secondary data were used for the purpose of the study. One set of structured

questionnaire was used to collect primary data for the study. Knowledgeable and potentialrespondents were consulted to make the questionnaire all inclusive i.e., all possible answers weregiven in the questionnaire. In the questionnaire responses were sought from various ATM usersregarding their levels of satisfaction on various issues, opinion regarding the positive anduncomfortable features of HSBC ATM etc. In the questionnaire, respondents were asked tenquestions of which eight were related to their level of knowledge and comments on various issuesof the HSBC ATM. Two questions were asked to measure the level of satisfaction. In onequestion, respondents were asked to indicate their level of satisfaction regarding various aspectsof the ATM (such as promptness of card delivery, performance, service quality of ATMpersonnel, quality of currency notes) of HSBC ATM on a 5-point scale (1 for Very Unsatisfiedto 5 for Very Satisfied). In another question, a respondent simultaneously using other banksATM was asked to compare the ATM service of HSBC with the service of other ATM used by

him/her again on a 5-point scale (1 for Very Poor to 5 for Very Good). The questionnaire isshown in the appendix.

After developing the questionnaire, it was given to two groups of respondents: HSBC head officestaff who use HSBC ATM and nonstaff general HSBC ATM users. The staff users filled in thequestionnaire themselves. For nonstaff ATM users, the survey has been conducted personally atselected ATM booths. Respondent ATM users have been explained the objectives of the studyand requested to fill in the questionnaire in the spot.

Besides many secondary sources have been used for supplementary purpose. Secondary sourcesinclude banks annual report, the group ATM branch procedure manual, relevant web-basedmaterials and prior research reports.

Data have been analyzed by using descriptive statistics. Mean levels of satisfaction of the twogroups of respondents (nonstaff and staff ATM users) were calculated. By using these meanlevels of satisfaction, information has been provided to use in analyzing the situation. As it is anexploratory research and convenience sampling technique has been used in selecting samples, thisstudy does not provide conclusive evidence to determine particular courses of action.

2.3 Key Terms Used:

For the purpose of the study, various key terms have been used, which are explained below.

ATM: An automatic/automated teller machine (ATM)is an electronic device which allows abanks customers to make cash withdrawals and check their account balances at any time withoutthe need for a human teller. Many ATMs also allow people to deposit cash or cheques, transfermoney between their bank accounts or even buypostage stamps.
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ATM card: An ATM card is a plastic card that looks like a credit card. It allows the bank accountholder to do the same things at a bank machine or Automatic Teller Machine (ATM) as he wouldat a bank. One can get cash, deposit money, check account balances, and receive a copy of yourstatement--all electronically--by using your ATM card and the password to your account, which iscalled your Personal Identification Number, or PIN (www.thebeehive.org).

Debit card: Debit card is plastic card issued by a bank or building society to enable its customerswith cheque accounts to pay for goods or services at certain retail outlets using the telephonenetwork to debit their cheque accounts directly (Woelfel, 1994).

Credit card: Credit card is plastic card issued by a bank or finance organization to enable holdersto obtain credit in shops, hotels, restaurants, petrol stations etc. The customer receives monthlystatements from the credit card company. This may be paid in full within a certain number of dayswith no interest charged or by means of a specified minimum payment plus a high rate of intereston the outstanding balance. The retailer or trader receives monthly payments from the credit cardcompany equal to the total sales in the month by means of that credit card, less a service charge(Woelfel, 1994).

Card mailer: A computer printed Bank Form with the address of the customer, PAN, date and a

reference number used as the means of identifying which card and its presentation folder shouldbe handled to which customer. ATM centre retains the card mailer after the customers signed inacknowledgment for the card.

Card collection advice: A computer printed bank form sent out to the customer to advise his/herATM card is ready for collection from their branch of account.

GATS: Global ATM Switch Processor which is located in Hong Kong and performs switching ofmessage, settlement and related services.

Pin advice: A sealed envelope within which PIN is enclosed. The PIN advice and the PIN mailerare enclosed in a single window envelope and handed to the customer.

3.0 Evolution of ATM

There has been a great deal of debate over the history of ATM, including who the ATMs inventoris. According to Invention & Technology Magazine (2000) in the late 1930s, Luther GeorgeSimjian started building an earlier and not-so-successful version of an ATM, but he registerrelated patents. Starting in 1939, Simjian registered 20 patents related to the device and persuadedwhat is now Citicorp to give it a trial. But the patent was unsuccessful because after six months,the bank reported that there was little demand. Afterwards New Yorks First National City Bank(now CitiBank) installed a Bankograph (ATM predecessor) in several branch lobbies in 1960. Theidea was for customers to pay utility bills and receipts without having to see a teller. A BarclaysBank branch near London takes the pride in installing first cash dispenser made by De La RueInstruments in 1967. It uses paper vouchers from tellers. The machine is called the De La RueAutomated Cash System, or DACS. This was produced byNCRin Dundee. This instance of theinvention is credited to John Shepherd-Barron, although George Simjian registered patents inNew York, USA in the 1930sand Don Wetzel and two other engineers from Docutel registered apatent on June 4, 1973. Afterwards Barclays and a few other banks introduce a machine thatencodes cash on plastic cards purchased from a teller in 1968. The problem is that the machinealways eats the cards, and customers have to buy new cards if they want to make moretransactions. First use of ATM magstripe cards started in 1969. Docutel installs its Docutellermachine at New Yorks Chemical Bank. the installation marks the first use of magneticallyencoded plastic.Other manufacturers get into the game, but Docutel is the first to apply for apatent. Docutel is later credited by Smithsonians National Museum for Americal History as beingthe ATMs inventor. Doland C. Wetzel is given the credit for developing the Docutel machine.Docutel introduces its Total Teller, the first true fully functioning bank ATM in 1971. after 1971,

proliferation begins to make the product more custoemr oriented. By 1973, 2000 ATMs- mostlyform Docutel are operating in the United States. They sell for about $30000 each. Diebold begins
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work on the development of the TABS 600 with plans for an off-line prototype. Diebolds firstTABS 500 machine, an off-line version, is installed at a bank in Atlanta in 1974.Diebold developsthe TABS 550, an on-line and off-line version. The flexibility of the machine makes it unique andmore marketable to banks. The TABS 600 also is developed. The first IBM-compatible Dieboldmachine is installed at a bank in Indianapolis in 1978.Gradually with the popularity of ATMservices this sector has developed dramatically (http://inventors.about andwww.atmmarketplace.com). Although the 1st Cash Dispenser machine in Bangladesh wasinstalled by Agrani Bank at Press-club branch but the modern use of ATM started in Bangladeshby Standard Chartered Bank in the early 90s. HSBC installed ATMs in 1997 and now they have12 ATMs and 5 Easy Pay Machines (EPMs).

4.0 HSBC ATM: An Overview

The HSBC Group introduced Automated Teller Machine (ATM) services to HSBC Hong Kong in1980. The acronym ETC (Electronic Teller Card) was selected for the card as the Chinesetranslation meant easy flow of money. Therefore, ETC is the universally accepted title for theGroups local ATM cards which provide local customers with ATM services. As the need for

money overseas increases, the Group has developed the ETCI (Electronic Teller CardInternational), also known as Global Access Card, to meet the transaction needs of frequenttravelers.

With the rapid growth of HSBCs global ATM network in recent years, the network was formallynamed Global Access in February 1992 with the Chairmans endorsement. The service isavailable 24 hours a day and 7 days a week. The purpose of the ATM service is not only to thepublic the progressive image of the Bank, but also to protect the market share of retail deposits ifnot to increase it.

4.1 ATM service area of HSBC:

HSBC ATM (Automated Teller Machine)s are available in Dhaka and Chittagong coveringMotijheel, Gulshan, Banani, Dhanmondi, Uttara, Sonargaon Road, Shantinagar, and Agrabad &GEC Circle respectively.Currently HSBC has 14 ATMs and 5 Easy-Pay Machines (EPMs). Non-resident Bangladeshis having HSBC ATM card and selected group of Bangladeshi customershaving International card can access 800,000 ATMs through out the world. Foreigners havingHSBC card can also get access into HSBC Bangladesh ATMs when they visit Bangladesh.

4.2 Features of HSBC ATM:

The HSBC ATM enables the banks customers who are issued with an ETC/ETCI/Global AccessCard/Credit Card and a 6-digit secret number (or 4-digit number for some areas) known as a PIN(Personal Identification Number), to comply with the local share ATM network regulation, to

perform a number of transactions on the current, savings or credit card accounts. Table 2enumerates the variety of those transactions.

Table 2: Features of HSBC ATM

Cash WithdrawalFrom the ATM booth any ATM card holder can withdraw 50,000 taka in a dayfrom his or her account. The customer of ATM card can withdraw in total 50,000taka from any ATM booth as many times as he or she needs within 24 hours.

TransferAny amount up to account balance/available credit limit or daily cycle limit,whichever is lower, can be transferred between accounts under the same issuingbank within Bangladesh in any 24 hour period. In Bangladesh, the cycle limit isBDT (Bangladesh Taka) 1,00,000.

Statement Request

The customer can send request to the bank by the ATM, when he/she requires

his/her detail Account statements. The statement generally shows a ledger balanceand an available balance, is the same format as a teller terminal balance request.

When any customer enter the card into the ATM machine it displays some options
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PIN Changeon the ATM screen, PIN Change is one of the options. Customer can change hisPIN whenever he desires e.g. if he is not happy with the PIN assigned by the bank,or if he believes that his PIN is compromised. For new card, customer is advised tochange his PIN immediately.

Account ActivityEnquiry

The ATM users can have information regarding the account balance of his/heraccount each and every time the ATM transaction is occurred. HSBC ATM has a

option to provide a mini statement showing his/her last 8 (eight) transactions.Deposit/mail deposit Cash/Cheque, but not coins may be deposited in envelopes supplied by the ATM.

Cheque BookRequest

The customer can send request to the bank by the ATM for new cheque book, whenhis/her current cheque book is finished.

Enquiry Customer can enquire about anything, like any service, product, facilities throughHSBCs ATM.

5.0 Previous Research Findings

A fair number of theoretical and empirical researches on ATM and ATM card have beenundertaken throughout the globe due to the increasing scale of use of ATM cards and consequentconversion of the economy into a cashless one.

In the twenty-first century, ATM cards have become one of the most popular non-cashinstruments in the United States and popularity has been explosively growing around the world.As Stuart E. Weiner (1999) pointed out:

The total number of ATM transactions has more than doubled over the last ten

years and is estimated to reach near 11 billion again this year. And althoughthere are signs that ATM volume may be peaking, ATM access continues to grow.

The total number of ATM terminals has tripled over the last ten years.

Robert E. Litan (1999) described the introduction and rapid use of ATM as the most visiblerevolutions in banking sector. He also supported his claim by stating:

, ATMs offer consumers the convenience of banking in many more locations

than ever before. Indeed, ATMs far outnumber brick-and-mortar banks, in largepart because they are cheaper to operate than a bank branch. Today, nearly

200,000, ATMs are found throughout the country, more than the collectivenumber of branches of banks, thrifts, and credit unions (approximately 83,000).

In another article James J. Mcandrews (2003) talked about various utilities of ATM because ofwhich it has become so popular worldwide. The utilities include withdrawal of cash at moreconvenient times and places than during banking hours at branches, reduction of cost servicingetc.

The above mentioned articles talked about the various aspects of ATM mainly from thecustomers viewpoint. But Maria Gloria Cobas et al.(2001) have generalized some of the drivingforces behind banks decisions to install ATMs in the United States. According to the authors:

...in the early 1970s, when rising inflation and interest rates made it moredifficult for consumers to borrow, reduced consumers loyalty to their localbanks. These changes in economic conditions and consumer attitudes stimulatedcompetition among financial institutions. For banks that could afford theinvestment, ATMs represented an attractive strategy through which to

distinguish themselves and achieve a competitive market advantage.....In thesecond half of the 1970s, more institutions began to install ATMs to enhance

customer service and as a defensive measure against competition from otherbanks. Cost savings to banks were not a driving factor. Consumers used ATMs toaccess their accounts more frequently, so that the overall number of transactions

increased..... In the 1980s, other factors began to influence ATM installations.Because construction and operation of brick and mortar branches became


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increasingly expensive, some banks limited branch expansion or closed branches.ATMs provided a partial substitute for those lost branches.

Cash dispensing is still thought to be the killer-app of ATMs. Large numbers of customers stillrely on ATMs for cash, but few constantly use them for other services (Cobaset al.2001).

Professor Norman Penney claims the development of ATM services occurred for three reasons.First, financial institutions hoped to improve their competitive positions by attracting customeraccounts and . . . increase their revenues by increasing loans, creating higher balances, andenhancing their financial services packages. Second, ATMs were designed to perform many ofthe same tasks as a human teller at a lower cost. Finally, Professor Penney notes that somefinancial institutions made ATM decisions based on marketing considerations. For example,before building a new branch, one financial institution in Florida used its ATM to test whether thelocation would support a branch office. Financial institutions have also used ATMs to encouragethe direct deposit of payroll (Pidgeon, 2000).

In Bangladesh, a broad spectrum of electronic banking services is available with different degree

of penetration. Credit card service is provided by 23.1% of banks (PCBs and FCBs). Among otherelectronic banking services tele-banking (19.2%), electronic fund transfer (15.4%), and ATM(15.4%). ATM is gradually becoming popular in major cities. Some foreign banks provideelectronic fund transfer services. A group of local banks have introduced shared ATM network,which has increased availability of this type of electronic banking service. The network willgradually be extended to other parts of the country (Raihan et al, 2001).

There are huge potential cost savings if the banks manage to carry out a higher percentage of theirtransactions over the internet and other channels such as ATM (Raihan, 1998).

Though various articles have been published in various articles in Bangladesh regardingelectronic banking, computerization, innovation in banking sector etc but no separate study has

been undertaken regarding customer satisfaction of ATM service. Though, the banks who areissuing ATM cards provide brochure to make the users understand what ATM is, how to use theservice, the cost of service etc, but they rarely have information regarding the level of customersatisfaction with respects to various aspects of ATM use.

6.0 Survey Findings

This section deals with the survey findings related with the questions that demanded the ATMusers perception about the levels of satisfaction with respect to various issues.

The survey findings with respect to the level of customer satisfaction with various aspects can beshown in the following table:

Table 3: Level of Customer Satisfaction with various aspects

Average level of satisfactionItems

Nonstaff users Staff users

Promptness of card delivery 3.54 3.88

The performance of ATM 3.12 4.00

The service quality of ATM personnel 4.05 4.17The quality of notes (currency) 3.05 3.31

Relative Position of HSBC ATM 3.24 3.31

The above table indicates that both the nonstaff as well as staff ATM users are at more thanneutral state of satisfaction (the neutral state of satisfaction is denoted by 3) with respect to


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various aspects of ATM. But the staff users are more satisfied in all respects than the nonstaffATM users. Both types of ATM users are satisfied (denoted by 4) in respect of the service qualityof ATM personnel. In addition to this, staff ATM users are somewhat satisfied with respect to theperformance of HSBC ATM.

6.1 Knowledge about the features of HSBC ATM and use of the features:

The ATM users (selected on the basis of convenience) were requested to answer whether theyknow all the features of HSBC ATM and whether they ever use the facilities other than cashwithdrawal. The results are given below:

Table 4: Nonstaff ATM users knowledge about the features of ATM

Knowledge about thefeatures

Numberof users

Percentage(%)

Use of features by knowledgeable personsother than cash withdrawal

Yes 37 65

No 20 35

Total 57 100

Yes 32 (86 %)

No 5 (14 %)

Table 5: Staff ATM users knowledge about the features of ATM

Knowledge about thefeatures

Numberof users

Percentage(%)

Use of features by knowledgeablepersons other than cash withdrawal

Yes 34 81

No 8 19

Total 42 100

Yes 32 (94 %)

No 2 (6 %)

The above tables show that about 65% of nonstaff and 81% staff respondents know about thevarious features of HSBC ATM. Out of 65% nonstaff respondents, 86% use the facilities otherthan cash withdrawal (32). But about 35% of the respondents do not know all the features of theHSBC ATM. The % is a material one. Out of 81% staff respondents, 94% use the facilities otherthan cash withdrawal. Only 19% of the respondents do not know all the features of the HSBCATM. Though this percentage is not a material one, but it is not a good signal that even the HSBCstaffs dont know the features of ATM.6.2 Comment on the positive features of HSBC ATM

Table 6: Customers comment on positive features

Nonstaff customers Staff customersFeatures

Number Percentage (%) Number Percentage (%)

Cash withdrawal 57 100.00 42 100

Service quality of ATM personnel 43 75.44 34 81

Off-shore ATM 38 66.67 32 76

Time savings 36 63.16 30 71Easy to use 35 61.40 30 71

Prompt card delivery 33 57.89 32 76

24 hour service in 365 days 33 57.89 25 60

Account activity enquiry 22 38.60 24 57Statement request 21 36.84 20 48

Safety-security 20 35.09 18 43

Transfer 19 33.33 20 48

Deposit/Mail deposit 19 33.33 18 43

PIN change 18 31.58 18 43Good decoration & tidiness 18 31.58 18 43

Enquiry 13 22.81 15 36


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So the customers consider the cash withdrawal, service quality of ATM personnel, offshoreATMs, time savings, easiness in use, prompt card delivery as the positive features of HSBCATMs. But the customers are not well aware of the positive features such as account activityenquiry, statement request, transfer, mail deposit, pin change, enquiry etc.

6.3 Comment on the uncomfortable features/issues of HSBC ATM:

Table 7: Customers comment on uncomfortable features of HSBC ATM

Nonstaff Staff Uncomfortable features


Machine breakdown 37 64.91 16 38

Unsuitable location 30 52.63 13 31

Poor money quality 26 45.61 23 55

Unsecured 25 43.86 4 10Machine complexity 22 38.60 7 17

Delay in card delivery 18 31.58 8 19

Card locking 7 12.28 7 17

Poor service quality 5 8.77 - -More denominator of currency 3 5.26 - -Old fashioned & untidy 1 1.75 2 5

The nonstaff ATM users feel that the HSBC ATM suffers from a number of uncomfortablefeatures such as Machine breakdown, Unsuitable location i.e. insufficient number of ATMs; Poormoney quality, Security problem particularly in Banani ATM. According to the staff(selected onthe basis of convenience) poor money quality, machine breakdown, unsuitable location, delays incard delivery are the main problems of HSBC ATM.

6.4 Recommendation made by customers:

Table 8: ATM users recommendations

Nonstaff Staff Recommendation


New ATM locations 42 61.40 30 71

Better quality currency 26 45.60 23 55

Increase of safety security 25 43.86 4 10More user friendly machine 22 38.60 7 17

Increase in number of ATM 20 35.09 15 36

Prompt card delivery 20 35.09 8 20

Better customer service 5 8.77 - -Facility to pay utility 5 8.77 5 12

More withdrawal limit 3 5.26 - -More denominator 3 5.26 - -Making more attractive-decorations

1 1.75 1 2

In order to improve the service quality of HSBC ATM, the nonstaff as well as staff ATM usersmade different types of recommendation. The recommendations include increase in the number ofATM locations, better customer quality, increase of safety security, more user friendly machine,increase in number of ATMs, prompt card delivery etc.


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The preference for new location:

According to the nonstaff customers the following are the most important locations where HSBCcan set up new ATM booth:

Table 9: Nonstaff customers preference for new location

Location Response Percentage (%)

Mirpur 30 52.63

Mohammadpur 28 49.12

Mohakhali 25 43.86

The other locations include Farmgate (10), and Jatrabari (5).

Among the different new locations selected by the staffs, the following are noteworthy:

Table 10: Staff customers preference for new location

Location Response Percentage (%)

Mirpur 30 71.00Newmarket 20 48.00

Mohammadpur 18 43.00

Rampura 10 24.00

The other locations include Shaymoli, Mohakhali, Shahbag etc.

6.5 Comment on additional facilities by customers:

Here the respondents were requested to comment on whether they want any further facilities otherthan ATM such as debit card, credit card etc. The responses are given in the following table:

Table 11: ATM users comment on additional facilities

So the customers want some more facility such as credit card facility to be used in HSBC ATM.

7.0 Summary of Findings

The survey findings can be summarized in the following manner:1. The staff and nonstaff HSBC ATM users (selected on the basis of convenience) are more

than neutral state in respect of all the criteria selected to determine the level ofsatisfaction.

2. The average satisfaction level of staff ATM users is more than that of nonstaff ATM usersin all respects. And the difference is material in case of their opinion regarding theperformance of HSBC ATM. The reasons can be explained below:

Use of Branch ATM:

The staffs use the facilities of branch ATM more than the off-site ATMs. The reason

is obvious. They work in a particular branch. After the end of the day, or at a time ofneed if they are at the office, they use the branch ATM facilities. The branch ATM

Nonstaff Staff Facilities


Debit card 10 17.55 - -

Credit card 30 52.63 30 72.00Both 12 21.05 12 28.00

None 5 8.77 - -

Total 57 100.00 42 100.00


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facilities are generally better than the booth ATM facilities. Because whenever thebranch ATM facilities are out of order or some sort of problem arises with respect tobranch ATM, the branch staffs can take quick action to bring the facility in order or tosolve the problem. But in case of off-site ATM, the HSBC uses the services ofGroup 4 Falck which on behalf of HSBC, conducts the appropriate maintenancefunctions such as currency refilling, deposit collection, currency sorting, maintenanceetc. So whenever a particular off-site ATM goes out of order for any reason, theauthorized personnel of Group 4 Falck go to the problem area and conduct therepair & maintenance. But the communication consumes much time, for example, ifthe Group 4 Falck members are at Dhanmondi CSC, and problem arises in UttaraCSC , it takes time for them to reach Uttara. So during the time the customers have towait for their arrival or move to other ATM booth. But the staffs face this type ofproblem rarely as they use branch service more.

Psychological reason:

The staff respondents hold good impression about their organization. So wheneverthey were requested to comment on their satisfaction levels in various aspects of

ATM, they generally provided positive responses which are consistent with theirmental setup.

3. The main problem areas of HSBC ATMs are listed below:

Machine breakdown:

About 65% nonstaff and 38% staff ATM users feel that machine breakdown is themain problem of HSBC ATM. Machine breakdown generally occurs for thefollowing reasons:Poor quality notes:If the notes supplied in the ATMs are of poor quality, the chanceof machine breakdown increases. Because the sensor that picks the notes from thecassette cant operate smoothly.

High frequency of use: As the number of ATMs of HSBC is less than that required,the frequency of use of ATM is very high. As ATM is a machine, the probability ofgoing out of order rises with the high frequency of use of machine.

Unsuitable location:

About 53% customers and 31% staff ATM users feel that the location of HSBC ATMis unsuitable for the users. It means that the numbers of HSBC ATMs are so limitedthat the users have to face difficulty to get its service.

Poor Currency Quality:

About 55% staff and 46% customers believe that poor currency quality is a greatproblem of HSBC ATM. In respect of quality of notes, the mean satisfaction level isthe lowest for both staff as well as nonstaff customers. The customers averagesatisfaction level is 3.05 and that of staffs is 3.31. This lowest satisfaction levelindicates that the notes supplied at various ATMs are not of good quality. As a result,the customers receive poor quality notes such as old notes, torn notes etc.

Unsecured:

About 46% customers and 10% staff believe that the security system of HSBC ATMis not sufficient. By the term unsecured the customers mean that there existssecurity problem for them outside the ATM booths. It has found that from outside,any person can see through the glass of HSBC ATM what the customers are doinginside the booth.


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Machine complexity:

About 38% nonstaff and 17% staff ATM users believe that the ATM machines arecomplex i.e. they are not easy to use. Customers generally put this argument whentheir cards are retained by the ATM machine. Cards may be retained for manyreasons but ultimately the blame goes to the machine. Another reason can be thatpeople in Bangladesh still get frightened while using any types of machine that dealswith money.

Delay in card delivery:

About 32% nonstaff customers and 19% staff believe that the HSBC ATM center isnot efficient in making quick delivery of cards. Delay in card delivery generallyoccurs because HSBC Bangladesh does not own any ATM card embossing machinenor it uses the facilities of any institution in Bangladesh. The HSBC ATM cards comefrom Hong Kong. So it takes time in making delivery. Moreover, HSBC ATM centeruses the facilities of Sonar Courier, a private courier service-provider, to makedelivery of cards which are to be delivered to the specific address of customers. Sonar

Courier personnel sometimes fail to make delivery to the address because of thefollowing reasons:

Wrong address of customers; Incomplete address of customers; Fictitious address of customers; and Address which is outside the serving area of Sonar Courier.

If such problem arises, Sonar Courier returns the cards back to the ATM center whichthen sends the cards to the respective branch where the customers opened the account.All these take time and delay in card delivery occurs.

4. Though HSBC ATM has many positive features such as account activity enquiry,mail/cheque deposit, statement request, PIN change, transfer, enquiry etc., the nonstaff

ATM users and a material percentage of staff ATM users are not well aware of these. Asa result for facilities other than cash withdrawal and cash deposit, they normally have todepend on the branch services.

5. With respect to service quality of ATM personnel, both the nonstaff and staff users aresatisfied. The average level of satisfaction is 4.05 for nonstaff customers and 4.17 for staffATM users. It means that the ATM personnel have performed extremely well in servingthe customers for their various needs.

6. Other than ATM cards, customers also want credit cards, and debit cards. Recently,Standard Chartered has introduced debit card in addition to ATM card facility. Thecustomers of HSBC feel the need of credit and debit card facilities. About 53% ofnonstaff and 72% of staff ATM users demand the facilities of credit card to beincorporated in the ATM card. At present, HSBC offers debit as well credit cards but ithas not yet allowed these cards to be used in ATMs. Customers want the restriction to berelaxed.

The customers of HSBC ATM have made different recommendations for the improvement ofservice quality of HSBC ATM which have policy implications. The most importantrecommendations and their policy implications are as follows:

New ATM locations:

At present, numbers of ATM location are not sufficient to meet the needs of growing number

of ATM users, new ATM location is a crying need. About 62% of nonstaff and 71% of staffATM users (selected on the basis of convenience) have suggested the need for new ATMlocations.Customers have also suggested the locations of new ATMs such as Mirpur,


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Mohammadpur, New market, Mohakhali etc. So the top management should consider thegrowing demand of new ATM locations. But they should consider the costs and benefits ofsuch decision.

Better quality currency:

Better quality currency is another important recommendation of customers. About 46% ofnonstaff and 55% of staff customers of HSBC ATM think that the currency quality should beimproved. It can be done by supplying new notes to the ATM. The HSBC should makesufficient arrangement so that they can receive better quality notes from Bangladesh Bank.

Increase in number of ATMs:

The present ATMs are located in various busy places. Customers have to wait in line to getfacility of these ATMs. It consumes their valuable time. So about 36% of customers haveurged for the increase in number of ATMs in an existing booth.

Management might consider increasing the number of ATMs. But here they should also

consider the liquidity issue. New ATMs will mean that more liquid money more be neededand if the demand is not enough, the organization will face the problems arising out of excessliquidity. So management should consider the issues while making the decision.

More user friendly machine:About 39% customers (nonstaff) and 17% of staff customers think that the ATMs should bemore user friendly. User friendliness can be improved by increasing awareness of how ATMscan be used. Another option may be redesigning the software used in ATMs.

Increase of safety security:

About 44% of nonstaff ATM users believe that the safety and security measures should beimproved inside and outside ATMs. This can be done by

Use of nontransparent glass so that people outside the ATM booth cant see whatis happening inside the ATM.

More security measures outside the ATM booth through requesting theappropriate law-enforcing agencies.

Providing licensed arms to the security persons of ATM.

Prompt card delivery:About 35% nonstaff and 20% staff ATM users think that there should be quicker deliveryof ATM cards to the customers. This can be done by one of the following two ways:

Importing embossing machine: At present HSBC Bangladesh does not own anyembossing machine and does not use the embossing facility of any organizationbecause of poor quality. But HSBC Bangladesh has to bear the procurement

charges, courier charges of new ATM cards, etc. So it can think of importing theembossing machine to Bangladesh which will facilitate prompt card delivery,savings of courier charges, new employment generation (social responsibility)etc.

HSBC Bangladesh should consider the costs of new embossing machine as wellthe potential benefits while making such decisions. Motivating the customers to provide exact address to which the ATM cards

will be posted and in case of change of address, communicating the addresschange to the appropriate authority.

Motivating the courier authority to increase their service area so that no cardis returned back due to nonavailabilty of service.


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8.0 Scope of Future Research

Further studies can be undertaken in this area. For instance, Quality Function Deployment (QFD)technique may be used to find ways to improve customer satisfaction of ATM service. QFDconcentrates on maximizing customer satisfaction (positive quality) by seeking out both spokenand unspoken needs, translating these into actions and designs, and communicating thesethroughout the organization end-to-end. Further QFD allows customers to prioritize theirrequirements, benchmark against competitors, and then direct to optimize those aspects ofproduct, process, and organization that will bring the greatest competitive advantage(www.qfdi.org). so customers requirements and their relationships with design characteristics arethe driving forces of QFD methodology (Govers 2001). Again, in this study, conveniencesampling technique has been used. The use of this sampling is subject to error. So further researchcan be undertaken using the random sampling technique to make the sample more representativeof the total population.

9.0 Concluding Remark

From the above analyses, it is evident that HSBC ATM has many positive features but thecustomers selected on the basis of convenience are not well aware of all these. These customersare also facing different types of problems with which ATM is directly related. Machinecomplexity, machine breakdown, poor quality notes etc. are the major problems identified by theATM users. Some inconvenient features are not directly related to HSBC ATM such as safety-security, decoration etc. Staff and nonstaff ATM users have different levels of satisfaction withvarious aspects of HSBC ATM. The most important thing is that at every aspect, the selectedcustomers have more than neutral state of satisfaction. Though this study cant provide conclusiveevidence to determine particular courses of action and further research will be required to provideconclusive evidence. But the management of HSBC should consider the findings and take allnecessary steps for further research and if they think that the customers of HSBC ATMs are

homogeneous in their choice and preferences, They may follow the recommendations made bythe customers such as increase of number of ATM locations, new ATMs, better currency quality,increase of safety-security, introduction of credit card, debit card etc. to gain more customer baseand achieve more customer satisfaction.

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Appendix

Use of ATM and the level of satisfaction

Location: .

Point 1 2 3 4 5

Level of

satisfaction

VeryUnsatisfied

Unsatisfied Neutral Satisfied Verysatisfied

Questionnaire

Please put tick (

) /comment on the following as appropriate:

1. Level of satisfaction with

v The promptness of card delivery:

v The performance of HSBC ATM

v The service quality of ATM personnel(Query response, timely action on request etc)

v The quality of notes (currency)

2. Do you know all the features of HSBC ATM?

3. If yes, have you tried ever to use the facilities

other than cash withdrawal?

4. If no, what is the reason behind your reluctance?

q It is cumbersomeq I dont like itq Branch service is betterq It cant provide me required informationq It is time consumingq Any other-please specify

1 2 3 4 5

1 2 3 4 5

1 2 3 4 5

1 2 3 4 5

YES NO

YES NO


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5. What are the positive features of ATM service of HSBC

q Prompt card deliveryq Easy to useq Satisfied with the service quality of ATM personnel

q Time savingsq 24 hour service in 365 daysq Off-shore ATMq Cash withdrawalq Account activity enquiryq Transferq Deposit/Mail depositq Statement requestq PIN changeq Enquiryq Safety-securityq Good decoration & tidinessq Any other-please specify

6. What are the uncomfortable features/issues of HSBC ATM?q

Poor money qualityq Card lockingq Delay in card deliveryq Machine complexityq Machine breakdownq Unsuitable locationq Unsecuredq Old fashioned & untidyq Any other please specify

7. What are your recommendations to improve HSBC ATM services?

More user friendly machine

Better customer service

Prompt card delivery

New ATM locations

Increase in number of ATM ( which location)

More withdrawal limit


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Facility to pay utility

Increase of safety security

Better currency quality

Making more attractive-decorations

Any other- please specify

8. Other than ATM, do you want

Debit card Credit card Both

None Any other-please specify

9. Do you use the ATM service of any other bank?

10. If yes, how can you compare the ATM serviceof HSBC with the same of any other bank inBangladesh?

Thank you very much for your time, cooperation & patience

*****************************************************

YES NO

Verypoor

Poor Average Good Verygood

Customer Satisfaction of ATM Services

Documents

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