ABSTRACT

Today banks are dealing with several challenges including global competition for Deposits, Loans, and
underwriting fees, increasing customer demands, shrinking profit margins: and need to keep up with the new
technologies. Banks have realized the importance of Customer Relationship Management (CRM) and its potential to
help them to acquire new customers, retain existing ones, and maximize their lifetime value. Banks has realized that
CRM is the only solution to help them to maintain a long term relationship with their customers. On the other hand,
maintaining relationships with customers also requires strong coordination between different departments at the bank
viz., IT, Sales, Service, Support, and Marketing. CRM came from the origins and is based on the principles of
Relationship marketing which is considered as one of the key departmental areas of modern marketing and the one
which generated great research interest over several years.
CRM came in to existence when banking institutions have started to become more and more competitive. The
focus of CRM increased banks abilities to understand the customers’ current needs more precisely and also helped
them to understand their customers behaviors, such as what they have done in the past , and what they plan to do in
the future. Such practice helped banks to design strategies based on each customer’s preference in order to meet their
customer’s needs. Customer information is important for banks and the intelligent use of such information would
create long term, two way relationships with customers.
1. INTRODUCTION
Customer Relationship Management (CRM) is fundamental to building a customer-centric
organization. CRM system links together the customer data into single and logical customer repository. In general
CRM for banks consists two primary tasks, acquisition of customers and increased sales other existing customers. It
is often justified by the phrase; Make the right offer at the right time to the right customer. It is believed that
successful adoption of IT- enabled CRM system in the banking industry redefines the banks interaction with its
customer’s with nationally and internationally. The adoption of CRM within the banking industry chiefly depends on
the overall adoption of IT culture within the country. Today developed countries like the UK are enjoying innovative
technologies, tailored made systems, and a high level of IT maturity; most of the IT projects in the organizations are
well managed.
Customer Relationship Management has become inevitable for growth and profitability of Banks in
present scenario marked by rising competition, technological advancement and empowered customers. The CRM
practices are adopted to generate better understanding of the customer for product development, segmentation,
appropriate targeting, campaign management and maintenance of long term profitable and mutually beneficial
relationships with customers. In Indian banking Customer Relationship Management is still at a nascent stage. A very

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 small proportion of its potential has been utilised. In the present Indian Banking Scenario, two prominent phenomena
are the focal point to emerging practices and policies. These are ‘Technology’ and ‘Relationship Marketing’. The
power of technology that has revolutionised banking services and practices. ‘Relationship Marketing’ is seen as the
only differentiating factor given the almost commoditisation of banking services.

Strategic issues of CRM initiatives

 The difficulty of obtaining a complete view of customers.
 The need to move away from disjointed, standalone, and inconsistent channels to provide a cohesive,
multichannel offering.
 The burden of disconnected legacy systems and disparate databases that store client financial data.
 The cost and complexity of meeting stringent government regulatory and client security and privacy
requirements.
 The pressure on margins and growth prospects from increased competition.
 The costs associated with retaining customers and developing customer loyalty.
Although CRM can help banking institutions efficiently manage their customers, many banks fail to meld the
concept into the prevailing work culture. But the high incidence of CRM failure has very little to do with the CRM
concept itself. Usually it's a case of the banks failing to pay attention to customer data they already have. A lot of
banks underestimate the magnitude of CRM. They tend to treat it just like any other application technology, without
realizing that CRM, if done properly, is a strategic initiative that touches all areas of an organization.

MIDDLE BAKI CHA

Ethical issues and privacy of crm

The specific ethical issues that characterised the financial crisis included manipulating credit ratings, the mis-selling of
securities, unauthorised trading and the short-selling of bank shares. In addition, there are long-standing ethical
concerns regarding practices such as market manipulation and insider dealing. The ethical implications of these
practices are not uniform – it would be difficult to objectively consider some of these activities to be unethical, whereas
others are clearly unethical. The financial crisis exposed a number of practices in investment banking that have been
described as unethical. In addition, there are practices that have been prominent in the past which raise ethical concerns.
This chapter looks at: • Manipulating credit ratings • Mis-selling securities • Mis-selling in M&A • Over-leverage •
Unauthorised trading • Insider dealing • Market manipulation and market abuse • CDOs/CDSs and off-market trading •
Speculation • Short-selling

FINDINGS

1. Majority of the respondents express that the CRM is important and very important and remaining says they don’t give important for it.

2. Majority of the respondents are satisfied with the bank’s CRM. But, they required more from the bank. Some of the respondents are feel that
the service provided by the bank is excellent.

3. Majority of the respondents express employs are comfort with the CRM. They find improvement in the employees’ reaction.

4. Majority of the respondents are satisfied with the CRM’s effectiveness and some of the respondents are feel as excellent in customer
retention.

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5. Most of the respondents feel that CRM will help the banks in customers improvement.

1. CONCLUSION AND RECOMMENDATION

There are a number of reasons why CRM has become so important in the last 10 years. The competition in the global
market has become highly competitive, and it has become easier for customers to switch companies if they are not
happy with the service they receive. One of the primary goals of CRM is to maintain clients. When it is used
effectively, a company will be able to build a relationship with their customers that can last a lifetime. Customer
relationship management tools will generally come in the form of software. Each software program may vary in the
way it approaches CRM. It is important to realize that CRM is more than just a technology.
Customer relationship management could be better defined as being a methodology, an approach that a
company will use to achieve their goals. It should be directly connected to the philosophy of the company. It must
guide all of its policies, and it must be an important part of customer service and marketing. If this is not done, the
CRM system will become a failure. There are a number of things the ideal CRM system should have. It should allow
the company to find the factors that interest their customers the most. A company must realize that it is impossible for
them to succeed if they do not cater to the desires and needs of their customers. Customer relationship management is
a powerful system that will allow them to do this.
It is also important for the company to use measures that are dependent on their customers. This will greatly tip the
odds of success in their favor. While CRM should not be viewed as a technology, it is important to realize that there
are end to end processes that must be created so that customers can be properly served. In many cases, these
processes will use computers and software.

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 Cook WD, Hababou M (2001) Sales performance measurement in bank branches. Omega 29: 299-307.

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 Tsiptsis k, Chorianopaulos A `Data Mining Techniques in CRM : Inside Customer Segmentation’, Wiley

 Kotler P, `Marketing Management’ (2009), Pearson India

 Chary T. Satya Narayana & Ramesh, R. (2012). Customer Relationship Management in Banking Sector- A Comparative Study,

KKIMRC IJRHRM, 1 (2), 20-29.

 Morgan J, ‘Customer Information Management: The Key to Successful CRM in Financial Services’, Journal of Performance

Management.

 Reynolds, J.N., Newell, E. (2011). Recent Ethical Issues in Investment Banking. In: Ethics in Investment
Banking. Palgrave Macmillan, London. https://doi.org/10.1057/9780230348851_
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