The Impact of New Generation Private Sector Banks on Public Sector Banks in India

The study attempts to examine the differences between the performance of Public Sector Banks (PSBs) and that of New Generation Private Sector Banks (NGPSBs) and also the impact of the latter on the performance of the former in terms of customer service and service quality. To assess the customer perception on service quality provided by the banks, SERVQUAL/SERVPERF questionnaires were administered on a sample of 1,075 respondents across the states of Telangana, Andhra Pradesh and Maharashtra. Factor analysis was done to understand the factors that influence customer service, service quality and customer satisfaction. The elimination exercise performed iteratively in factor analysis resulted in retaining of 14 variables out of 22, grouped into four factors, namely, efficacy, empathy, expertise and efficiency. The results unequivocally proved that NGPSBs do influence the performance of PSBs