Himachal has recently seen a spate of financial institutions opening offices and branches here. In the past 2 years banks like ICICI, HDFC have opened branches in the major towns of the state. The skylines are dotted with hoarding of insurance companies such as Bajaj Allianz, HDFC Standard Life, Reliance Insurance and Max New York life amongst many others. So are the offices of brokerage and share trading firms like Reliance money and India Infoline. Certainly the people who were once left to deal with public sector behemoths have newer options and opportunities to seek better financial services. But the question here is “Are these private sector firms offering any better services?
The picture is not so rosy when it comes to the service delivery aspect of it. In the last 3 months HimVani team has been hearing stories of customer apathy from many of its readers and citizen journalists. Boudhayan, who had recently moved to Shimla from Delhi wanted to renew his motorcycle’s insurance policy. The last one was issued by Reliance General Insurance in Noida. But he was shocked to find that in spite of having centralised systems the companies branch in Shimla was unable to process the renewal of the policy reason given was that branch did not fall in the same zone as Delhi. The option available to him were to go back to Delhi with his vehicle, get it inspected and then a new policy would have been issued.
Service delivery in private sector bank is no better. On a visit to ICICI bank in Shimla one is bound to find bored to death faces of front desk staff, which is just doing its job rather then creating a customer experience. The latest PR campaign of the bank says that it is well capitalised and has high networth. Well Mr. Kamath, certainly your bank is doing well in financial terms but customers expect good service. The “Hum Hein Na” factor is missing in this part of your operations.
Closer by on the mall road, the branch of HDFC bank is no better. Recently a friend wanted to open an institutional savings account for their society in the bank. She was surprised to find that the staff did not proper knowledge of the product as well as the documentation required for it. An account which normally takes an hour to open in a public sector banks is yet to be opened after chasing bank officials for more then 20 days. At the time of application the bank executives found that the board resolution is not in the format which is acceptable to the bank. However they accepted the application with a promise that they will be able to take approvals from their Cluster Head for the same. Surprisingly the approvals are yet to be taken in spite of chasing the bank executives almost every day.
Surprisingly in the both cases the ray of hope came in the form of the much criticised public sector institutions. Boudhayan who finally went to United General Insurance in Shimla had a new policy issued in one hour . All his paper work, vehicle inspection and processing of papers was done by an agent of the company who did not even charge any money from him. Shilpa got her societies account opened with State bank again in one hour and could put in her first cheque the same day. In both the situations the paperwork was completed and the service delivered at the branch itself. The same would have taken 15 – 20 days in private sector institution as service delivery comes from centralised offices in Mumbai or Gurgaon. It is due to this the HDFC bank executives are still figuring out whether they will get approvals from their bosses or not.
An analysis into the situation shows that in public sector institutions the branch managers have lot more decision making authority. Moreover for them the business is totally dependent of relationships and not on the process. A branch executive in a private sector institution is not confident while committing a service delivery to their clients unlike their counterparts in public sector institutions. Now that most of the public sector institutions are heavily using IT to deliver services through ATM and Online banking the staff is lot freer to offer personal services to customers thus increasing the whole customer experience as well as competition for the private banking and financial institutions.