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special featureof the customers. Banks have to make more effortsto garner better market share, of which the qualityof customer service has come to be the distinguishingfactor.Moreover the vast network of branches spreadacross the entire country with millions of customersbegan to create wider opportunity to add more value.The new blend of variety of products and services, thevariety of delivery channels etc have added to theenormity and complexity of banking operations inIndia to keep service levels improving. Thus the urgeto improve the quality of customer service requiresa relentless effort and continuity in putting optimumresources together. A series of studies have beenconducted by various committees such as the TalwarCommittee, Goiporia Committee, Tarapore Committeeetc., to bring about innovative methods and meansto improve the performance and procedures involvedin the dispensation of hassle-free customer service.These committees have made significant contributionto improve the quality and reach of customer services.a) Significance of quality of customer service :The banking industry is predominantly a customeroriented business and good customer service isthe key to its growth and stability. With intensecompetition in the banking industry, customer servicebecomes the sole differentiating factor to be leveragedto stay ahead in the market and capture new linesof business. With the rise in the customer base anddiversifying customer needs the customer aspirationsare always dynamic and shifts with the developmentsin the working environment. With the rise in thestandard of customer service, the customer awarenessgrows, and hence banks would be required to gearup for providing more efficient and at the same time,cost effective services leveraging the technologicalcapabilities. Customer retention is also going to bea key factor for banks. It would require banks towork on different strategies and showcase theproduct mix with the help of technology to satisfythe rising customer expectations so as to retain thecustomer patronage.Though several committees have earlier worked onidentifying measures to improve customer service,Reserve Bank of India had set up a committeein May 2010 to recommend strategies in the lightof the technology led banking environment developedin the industry more particularly in the last decade. Thecommittee was led by Chairman, Shri M. Damodaran.The Committee Report submitted recently broughtout many innovative measures that can changethe service standards in the Banks. More focushas been given to improve banking services renderedto retail and small customers and pensioners. Thestructure and efficacy of the existing grievance redressalmechanism, the functioning of Banking OmbudsmanScheme, and possibility of leveraging technologyfor better customer service have received specificspace in the report and has recommended stepsfor their improvement. Meanwhile, in the recentlyconcluded Ombudsman Conference, 10 action pointswere identified, which are essential to protect therights of the customers. These have been put inaction to improve the quality of customer service.These efforts when put together can transformthe standards of banking services in India. Thesedevelopments put together has brought to fore thequality of customer service as a key enabler tooccupy more strategic space in the banking industry.In a bid to occupy more space, banks began to offerhigher class of service to different customer segments.b) Developments in the customer service architecture :The deregulation of interest rates, entry of highermodes of technology, differential pricing, servicecharges, unique product features, proprietary deliverymodels etc have created an environment to developbank specific hybrid offerings for customers leadingto more competition. The individual efforts of banksto woo the customers with product and price variantscreated a different market environment. Moreover, theadvancement in the usage of latest technology broughtseminal differentiation both in the range and qualityof services. The more sophisticated the technologyand skill levels of its people, the more customisationof products / services were made possible heightening8October - December 2011The Journal of Indian Institute of Banking & Finance