Monday, June 9, 2008

Salaried choose government banks for insurance

by Jo Black

60% of salaried employees prefer state owned banking mechanisms for insurance purposes, as they feel that such institutions are more reliable, secure and are trustworthy, while 20% prefer private banks for the same purpose, and the remaining 20% have shown their indifference to either of the two, according to findings of The Associated Chambers of Commerce and Industry of India (ASSOCHAM).

The aforesaid findings of the Chamber have been contained in a study which it brought out on `Growth and Emergence of Public and Private Sector Banks in India : Customer’s and Investor’s Perceptions’, in which over 250 salaried employees, businessmen, lawyers have been interviewed.

The ASSOCHAM Study on the subject has also revealed that 50% of the salaried employees prefer the private sector for mutual funds while only 20% prefer public sector banks for the same.

20% are indifferent to either of the two sectors for parking their funds in mutual funds while 10% do not use this service.

40% of the employees prefer public sector banks for purposes of investment in bonds and securities as compared to 30% who prefer the private banks.

The insurance services provided by the public sector banks are preferred by 60% of the salaried employees, while only 20% prefer the private banks for insurance purposes, and the remaining 20% are indifferent to either of the two categories.

This preference for public sector banks for insurance is mainly due to the fact that as a general perception the employees find public sector banks (PSBs) more reliable, secure and also trustworthy.

The consolidated preferences of salaried employees in public and private sector banks show an inclination towards the private banks.

Releasing the study, Mr. Venugopal N. Dhoot, ASSOCHAM President said that for bonds and securities, businessmen preference is the other way round i.e. 80% preferring PSBs.

For Demat services 40% prefer private banks while 20% are indifferent.

For opening demand deposit accounts 40% of the businessmen prefer PSBs while the same percentage prefer the private banks for demand deposit.

For fixed deposits 60% of them prefer PSBs, 20% prefer private banks while 20% are indifferent between the two types.

For credit cards 60% of the businessmen prefer PSBs while for debit cards 40% prefer private banks, 20% prefer PSBs and 20% being indifferent.

For ATMs 60% of the businessmen prefer private banks, while for phone and internet banking all the businessmen have opted for private banks because they are highly professional, quick and efficient and have good infrastructure and good appearances.

For loan facility, the majority of businessmen have preferred public sector banks as they found them much more reliable and secure, barring for home loans for which they prefer private banks.

This is because private banks are too messy with tremendous growth, it is difficult to comprehend their offers, they charge high rates of interests and are very clever with customers.

 

 

 

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