“Adding Value

Proposition to the
Credit Card of Nepal
Investment Bank Ltd.”

Project Submitted to
South Asian Institute of Management

Submitted By:
BINITA MITTAL

5th term
South Asian Institute of Management
[25th July. 2010] SIGNATURE PAGE

1
I hereby certify that this report has been thoroughly read by me and that it
is satisfactory in all aspects.

_________________

Ram Raj Upadhyay,

Branch Manager,

Nepal Investment Bank Ltd.

COPYRIGHT

2
Copyright © All rights reserved. No part of this publication may be
reproduced, stored in a retrieval system or distributed in any form by any
means, electronic, mechanical, photocopying, recording or otherwise,
without the written permission of the publisher and copyright owner.

Unauthorized export of this project is violation of the Copyright Act 2005.

Violation of this law is subject to Civil and Criminal penalties.

Author: Mrs. Binita Mittal

Copyright © 2010, South Asian Institute of Management

3
DISCLAIMER

The authors are confident that the results of the analysis and the results
presented in this report will be taken as guidance for a more comprehensive
study in the future date. The authors are not responsible or liable, legally
against the results and consequent decisions based on the responses
received from the analysis of the report.

The views expressed in this report are those of authors only.

4
ACKNOWLEDGEMENT

We have been fortunate to have full cooperation of many people during the
duration of our project. We would like to extend our heartfelt gratitude to all
people Nepal Investment Bank Ltd. for their help and support.

We are thankful to all the people who helped us by filling questionnaires and
by providing us adequate information through interviews. We would also like
to extend our gratitude to SAIM Library for providing us with the required
literature.

Finally, we extend our sincere gratitude to Prof. Bijay KC (Course Instructor),

for his continued guidance and support throughout the project.

This page is specifically designed to note our appreciation of those people

who stand out most notably in our minds during the duration of the project.
We are grateful to them all.

Binita Mittal

5
EXECUTIVE SUMMARY

This market research study was carried out to determine the factors that
add value of the credit card. This research study was chosen among many,
after thorough evaluation of several market research related topics given to
us by Nepal investment Bank Limited. This was primarily due to the
understanding of the fact that due to increase in competition in the banking
sector, satisfaction to customers in all the products provided by the bank
has become very important. Customer did not seem to be very satisfied with
the facilities provided by the credit card because of which there is no
frequent use of credit card So to dissect this management decision problem
by means of research this research project has been undertaken.

Both exploratory as well as descriptive researches were conducted. Initially

to find out the problems that needed to be tested in the sample population
were derived from interviews and observation. Those information’s
highlighted the issues that those customers had with Credit card. It also
highlighted the factors that would help increase the value of credit card and
the factors that would help increase the frequency of its use .The
information was again cross checked from the management and formed in
questionnaire. The questionnaires were distributed among few customers to
check its short comings. Then the needed modifications were made and
distributed through self monitoring to the sample customers. Majority of the
findings are based on the Questionnaire survey and interviews conducted.
After this, the tool was designed, tested and administered. The hypotheses
were tested using SPSS and finally the conclusions were drawn based on
which recommendations have been given.

6
Contents
SIGNATURE PAGE...................................................................................................1
COPYRIGHT............................................................................................................ 2
DISCLAIMER............................................................................................................4
ACKNOWLEDGEMENT.............................................................................................5
Binita Mittal............................................................................................................ 5
EXECUTIVE SUMMARY............................................................................................6
Contents.................................................................................................................... 7
Literature Review...................................................................................................8
CHAPTER 1..............................................................................................................11
1.1 BACKGROUND................................................................................................11
1.1.1. Objective of the study................................................................................11
1.1.2. Importance of the study.............................................................................11
1.1.3. Limitation of the study...............................................................................12
1.1.4. About the company....................................................................................12
1.2 ISSUE:.............................................................................................................13
MDP:..................................................................................................................... 13
1.4 MRP:............................................................................................................... 14
1.5 RESEARCH QUESTION AND HYPOTHESIS FOR NIBL........................................14
1.6 CONCEPTUAL FRAMEWORK............................................................................16
Fig: REPEAT – PURCHASE MODEL............................................................................16
CHAPTER 2..............................................................................................................19
2.1. RESEARCH METHODOLOGY..............................................................................19
2.1.1. Population..................................................................................................19
2.1.2. Definition of the information needed.........................................................19
2.1.3. Measurement and scaling Procedures........................................................20
2.1.4. Questionnaire Design.................................................................................20
2.2. QUANTITATIVE RESEARCH.............................................................................20
2.2.1. Sampling Process, Sample size and Sampling Frame................................20

7
 2.2.2. Field Work / Data Collection.......................................................................20
2.2.3. Data Preparation and Analysis...................................................................21
CHAPTER 3..............................................................................................................22
3.1 DATA ANALYSIS FINDINGS..............................................................................22
3.2 CONCLUSION..................................................................................................28
3.3 RECOMMENDATION........................................................................................29

Literature Review

A credit card is a system of payment named after the small plastic card
issued to users of the system. In the case of credit cards, the issuer lends
money to the consumer (or the user) to be paid later to the merchant. It is
different from a charge card, which requires the balance to be paid in full
each month. In contrast, credit cards allow the consumers to 'revolve' their
balance, at the cost of having interest charged. Most credit cards are issued
by local banks or credit unions, and are the same shape and size, as
specified by the ISO 7810 standard.

It is an undeniable fact that credit cards play an important role in our

society today. For businessmen, business credit cards are a great help in
separating their personal accounts from their business accounts. It is a
convenient way to manage the company and the employee’s business
expenditures. It also makes accounting and tax monitoring easier through
updated periodical reports of all purchases made.

The stiff competition among banks has given birth to a variety of classes of
business credit cards, which can only mean bigger and better choices for
customers. Deals are becoming more and more attractive, and clients are
given more options and freedom to get the best service they need.

The vast number of business credit cards to choose from can cause
confusion for a prospective customer especially if everyone seems to be
offering a great deal. With all the excitement, it could be tempting to sign-
up to the first credit card offer that catches your attention, without even
considering the others. Whichever provides the best deal/ service customers
go for it. So the value of the credit card lies on the facilities provided by the
credit card.

Benefits of Credit Card

8
Credit card can be used to get the statements to keep track of exactly how
much you are spending and where your money goes. With some credit
cards you can use personal finance software to download your credit card
transactions from the Internet right to your home computer.

Credit cards may actually save you money. Some people avoid making
purchases if they do not have cash. Cash seems to "burn a hole" in our
pockets, it just disappears. It is so easy to spend and it is right there. But a
credit card takes more effort and you know that you have to pay the bill
later that month.

Your credit card may also offer a rewards program where you get cash back,
frequent flyer miles or discounts on services and merchandise.

Credit cards are convenient. Some purchases, especially those on the

Internet, will only accept credit card payment. Also you don't have to
continually go to the bank or ATM to get cash.

A credit card also provides a measure of safety. You don't have to carry
large amounts of cash for large purchases. Even if your card or credit card
number is stolen, you are not responsible for the thief's use of your card.

But credit cards can also be a crutch. Too many people see their credit limit
not as the maximum amount of debt they can go into, but as an account full
of money that they can spend.

Many people have developed the habit of using their credit cards to buy
what they want now and paying for it later. They then make only the
minimum payments required. Often the minimum payment is set so that
you only pay the monthly finance charge (interest) or just a small amount
above it.

Sometimes the credit card can lead a person into living a lifestyle that is
beyond their means. If a person gets in the habit of dining out two to three
times a week and these meals are paid for by credit card, the card balance
increases quickly. Often the additional expense was not planned or
budgeted. People can even end up spending more each month than they
actually earn.

This can continue as long as the credit card balance is below the limit and
the person makes their regular monthly payments. But as soon as the credit
limit is reached, many credit companies will increase the credit limit and
give the person more room to get into debt.

9
Things to consider when you are looking for a business credit card

For instance, if your type of business entails you to make large purchases,
you will be most happy with a business credit card that offers cash backs on
these items. Usually along with cash back programs; they also have point
system rewards which entitles a customer to one point for every one dollar
spent on the credit card. You can actually save a lot of money by buying
more items which your business really needs.

If you are a frequent traveler, you can take advantage of free travel
privileges as your reward. You may also avail of discounts from affiliated
airlines, so it would be better if you choose the business credit card that has
partnership with the airline you regularly fly with.

Aside from the benefits listed above, added perks may include shopping
privileges from affiliate merchants, or discounts from servicing outlets like
shipping, printing, mail deliveries, gas stations, etc. which are often the
services that businesses commonly use. Taking all these rewards and
benefits in consideration can earn your business a great deal of money

For merchants, a credit card transaction is often more secure than other
forms of payment, such as checks, because the issuing bank commits to pay
the merchant the moment the transaction is authorized, regardless of
whether the consumer defaults on the credit card payment. In most cases,
cards are even more secure than cash, because they discourage theft by
the merchant's employees and reduce the amount of cash on the premises.
Prior to credit cards, each merchant had to evaluate each customer's credit
history before extending credit. That task is now performed by the banks
which assume the credit risk.

For each purchase, the bank charges the merchant a commission (discount
fee) for this service and there may be a certain delay before the agreed
payment is received by the merchant. The commission is often a percentage
of the transaction amount, plus a fixed fee. In addition, a merchant may be
penalized or have their ability to receive payment using that credit card
restricted if there are too many cancellations or reversals of charges as a
result of disputes. Some small merchants require credit purchases to have a
minimum amount to compensate for the transaction costs, though this is
not always allowed by the credit card consortium.

In some countries, for example the Nordic countries, banks guarantee

payment on stolen cards only if an ID card is checked and the ID card
number/civic registration number is written down on the receipt together
with the signature. In these countries merchants therefore usually ask for

10
ID. Non-Nordic citizens, who are unlikely to possess a Nordic ID card or
driving license, will instead have to show their passport, and the passport
number will be written down on the receipt, sometimes together with other
information. Some shops use the card's PIN for identification, and in that
case showing an ID card is not necessary

“The value of any product is felt by the customer if that product gives
satisfactory service/ facility to the user. So is the case with the Credit card.
The value proposition of the credit card lies on the facilities it provides.
More the facilities to the customers more will be its value.”

CHAPTER 1
1.1 BACKGROUND

1.1.1. Objective of the study

The main objective of the study was to identify and analyze the factors or
the unique features that contribute to the satisfaction of credit card users
leading to increase in frequency of its use, through the use of various
marketing research techniques. Marketing Research as a field of study has
become the key strategic weapon for any organization to better understand
the market. This study aims to solve the problem of KUSOM through the
practical and theoretical understanding of this course.

1.1.2. Importance of the study

Today the banking sector of Nepal has seen a tremendous growth with
mushrooming number of commercial and development banks. There is a
tough competition brought in from the new entrants with their innovative
ideas and strong marketing sense. The commercial banks in Nepal have
11
been fighting for their share of the pie with their respective competitors.
Due to the increase in number of financial institutions customers bargaining
power have increased. Customer’s satisfaction has become a very important
for every bank. Due to the busy schedules, customers look for an easier way
to get their things done. So which ever bank provides them with better
facilities they switch to that bank. Credit card is one product that bank
provides to its customer to make their work easier. Frequent use of credit
card is profitable to the bank. So identifying he factors that will satisfy the
customer with the credit card which ultimately leads to increase the
frequency of use of credit card. So the importance of this paper lies on
understanding the implication of Marketing Research regarding problem
identification and solution generation.

1.1.3. Limitation of the study

The main limitation of this research was the time management. As this
research was to be conducted within 3 months time, adequate time that
these projects require could not be devoted.

For which, there might be some shortcomings in the paper because of us

not fully or adequately being able to implement entire marketing research
techniques.

1.1.4. About the company

Nepal Investment Bank Ltd. (NIBL1), previously Nepal Indosuez Bank Ltd.,
was established in 1986 as a joint venture between Nepalese and French
partners. The French partner (holding 50% of the capital of NIBL) was Credit
Agricole Indosuez, a subsidiary of one the largest banking group in the
world.

12
With the decision of Credit Agricole Indosuez to divest, a group of
companies comprising of bankers, professionals, industrialists and
businessmen, has acquired on April 2002 the 50% shareholding of Credit
Agricole Indosuez in Nepal Indosuez Bank Ltd.

The name of the bank has been changed to Nepal Investment Bank Ltd.
upon approval of bank’s Annual General Meeting, Nepal Rastra Bank and
Company Registrar’s office. The company believes that NIBL, which is
managed by a team of experienced bankers and

NIBL = Nepal Investment Bank Limited

1

professionals having proven track record, can offer its customers what they
are looking for. It is sure that their choice of a bank will be guided among
other things by its reliability and professionalism.

1.2 ISSUE:
Due to the competition prevailing in the Card industry, NIBL needs to do add
value to credit card to increase the frequency of credit card users.

MDP:
How can NIBL add value proposition to the credit card.

13
1.4 MRP:
Identify the unique facilities that add value to the credit card?

1.5 RESEARCH QUESTION AND HYPOTHESIS FOR NIBL

RQ 1: Are the customers satisfied with the credit card of NIBL?

H1: Satisfaction of customers less than 3.

RQ 2: Have the customers faced any bad experience with the use of Credit
card of NIBL?

H1: The bad experience of credit card is less than 3.

RQ 3: Will the prior experience with the credit card of NIBL affect its usage
in future?

H1: The affect on usage is less than 2.

RQ4: What new facilities do the customers seek from the credit card?

H1: The customers seek for electricity bill payment from credit cards.

H2: The customers seek for phone bill payment (landline and mobile).

H3: The customers seek for water bill payment.

H4: The customers seek for ISP bill payment.

H5: The customers seek for school fee payment.

H6: The customers seek for discounts in payments from credit cards.

H7: The customers seek for free transaction service from the member
banks.

14
RQ5: Will the addition of new facilities of credit cards increase its
frequency?

H1: Frequency of usage and phone bill payment facility is associated.

H2: Frequency of usage and school bill payment facility is associated.

H3: Frequency of usage and free transaction facility are associated.

H4: Frequency of usage and electricity bill payment facility is

associated

H5: Frequency of usage and discount on payments from credit cards

facility are

associated

H6: Frequency of usage and ISP bill payment facility are associated.

H7: Frequency of usage and water bill payment facility is associated.

RQ 6: Will the introduction of these facilities increase satisfaction?

H1: Satisfaction and phone bill payment are related.

H2: Satisfaction and school bill payment related.

H3: Satisfaction and free transaction service from member banks

facility is related.

H4: Satisfaction and discount while payment from credit card facility is
related.

H5: Satisfaction and ISP bill payment facility is related.

H6: Satisfaction and electricity bill payment facility is related.

H7: Satisfaction and water bill payment facility is related.

15
1.6 CONCEPTUAL FRAMEWORK
The various unique facilities in the credit card that customers seek for to
increase their frequency has been identified during the qualitative research
process. The facilities that customers look for in a credit card are electricity
bill payment , phone bill payment , water bill payment, ISP bill payment,
school fee payment, discounts in payments from credit cards, free
transaction service from the member bank. These attributes which have
been identified lead to satisfaction of customers leading to increase in their
frequency of purchase. Customers are already aware of the credit card
issued by NIBL and the customers have already tried as well but due to the
cut throat competition prevailing in the Nepalese market NIBL needs to add
extra facilities in the credit card to satisfy the customers which will lead to
increase in the frequency of its use.

Consumer state

Unaware

Aware

Trial

1st repeat
Product features/
distribution/
relative price
2nd Repeat

Fig: REPEAT – PURCHASE MODEL

16
Many new products are re-purchasable kind. These include virtually all the
non-durables consumed by the households and the factory. The sellers of
these products are even more interested in the repurchase rate than in the
trial rate. A low trial rate could be attributable to poor distribution,
promotion, packaging which are correctable. Trial of a new product can be
stimulated by distributing free samples, introductory pricing and so on. But
a low re-purchase rate may suggest a product that does not meet the
consumers’ expectations, which is harder to correct. Unfortunately, early
aggregate sales figures do not distinguish between the two rates. A rising
sales curve could mean a high trying with a low re-buying rate (a
correctable situation).

The figure above shows that individual consumers facing a new

frequently purchased product.

If the consumer is unaware of the product then,

1. He must be made aware of the product of the company. Creating

awareness about the product can be done with advertising,
promotion and sampling which are the main tools the marketer has
control of here.

NIBL present costumers who are our sample population and on

whose answer basis our research is focused on are already
aware of the Credit Card issued by the bank. So this step is not
of the serious concern to NIBL to help them increase the
frequency of purchase of the credit card.

2. In this second step, consumer must be induced to try the

product of the company. Advertising should be done in such a
manner which induces the consumer to buy the product. This step
shows the effectiveness of the advertising and promotion done for
the product. Effective advertising and promotion leads to trial
phase.

17
 NIBL present customers are the sample population on whose
answer basis our research is based on. They are the costumers
who are already the present users of Credit Card. So the trial
phase has already been passed by the customers.

3. In this third step, consumer must be induced to repeat once.

Once the product is not disliked by the consumer or even if the
consumer is in the confusion state of the product where the
consumer are not sure if it was really good or not, they will be
induced to repeat once. The product quality, relative price and
distribution affect repeat likelihood.

The customers of credit card holders of NIBL are not really in

this state because once the card is issued they do not use it only
once. And our research found out that there are no such
customers who have used the credit card only once after they
have issued it.

4. In this step of induced to repeat regularly, the product should

be of a very attractive package. Their product quality, relative
price, distribution will be of the most attraction to the consumers.
Once the customer is in this step of repeat-purchase model they
will be termed as LOYAL COSTUMERS.

NIBL present customers are dissatisfied with the present service

of Credit Card. Because of the dissatisfaction, there frequency of
use is not so high. For that NIBL needs to come up with new
attractive features in their product to lure the consumers to
repeat their purchase. This step is of a serious concern to NIBL
since the problem that we are trying to solve from this research
is on the frequency of the use of credit card where the effort of
the bank is to be focused on the product quality or the product
innovation by adding new unique features to the credit card to
induce the repetition of its use.

18
 So to reach this step of repeat purchase model, the only solution
for the NIBL is to increase the product quality or add new
features to the credit card.

CHAPTER 2
2.1. RESEARCH METHODOLOGY

2.1.1. Population

The sample populations for this research are the present customers of NIBL
of Kathmandu who uses credit card.

2.1.2. Definition of the information needed

The research required information about what is the credit card features
that customers want to make use it frequently. So, for this reason, both
exploratory as well as descriptive researches were conducted. Initially to
find out the problems that needed to be tested in the sample population
were derived from interviews and observation from NIBL. Those
information’s highlighted the facilities that customers look for in the credit
cards which would satisfy the customers leading to its frequent use.

The information was again cross checked from the management and formed
in questionnaire. The questionnaires were distributed among 5 customers to
check its short comings. Then the needed modifications were made and

19
distributed through self monitoring to the sample customers of all three
banks. Majority of the findings are based on the Questionnaire survey
conducted.

2.1.3. Measurement and scaling Procedures

Scaling used in the research process was ordinal, ranking, and interval.

2.1.4. Questionnaire Design1

The questionnaire incorporates all the information required for this report.
There were altogether 14 questions which were mostly close ended and
some were open ended. Detailed demographic information about the
customers were not required, them being present customers, so such
details have been excluded.

2.2. QUANTITATIVE RESEARCH

2.2.1. Sampling Process, Sample size and Sampling Frame

The sample populations were the present customers of NIBL. The sample
size was chosen as 80 for all as it is the appropriate size to test hypothesis.
Then through rand command, the random number to approach the
customers was derived as 2. So, every second present customer was
approached to avoid biasness. Self monitoring of the questionnaires was
done.

2.2.2. Field Work / Data Collection

1

20
Researchers have distributed their time and effort in filling the
questionnaires from the respondents. Thus data was collected from the
response of the respondent in the meeting itself. The researchers ensure
accuracy and authenticity of the responses as well as maintenance quality
of research methodology.

2.2.3. Data Preparation and Analysis

Proper and adequate editing, coding, transcription, and verification of data

were done. Each questionnaire was individually administered. Data Analysis
was done with the help of SPSS 15.0. Various parametric as well as
nonparametric tests were done to interpret the data. The tests included
one-sample t-test, regression analysis, chi-square, and correlation.

21
 CHAPTER 3
3.1 DATA ANALYSIS FINDINGS

Sample T-test

Description N P- Value Conclusion

Satisfaction of 80 0.024* It is true to the
customers less 3 population which

22
 shows that the
present customers
are dissatisfied
with the service or
credit card.
The affect on 80 0.035* It is true to the
usage is less than population and
2 since it is less than
2 it shows that the
prior experience
with the credit card
is not going to
affect its usage in
future.
The bad 80 0.025* It is true to the
experience of population so not
credit card is less much of the
than 3 customers had bad
experience with
the credit card
before.

Regression

Description N P-Value Conclusion

Usage of credit 80 0.049* It is true to the
card determined population and the
by satisfaction or usage of credit
not? card is determined
by the satisfaction
of the customer on
the usage of credit
card.

Frequency and sample T-Test

Description N Sum P - Value Conclusion
Which one does business 80 It is true to the

23
customers seek for? population and
customers seek
(i) Electricity bill 75 0.000* more for
payment “discount in
from credit payment from
cards credit card and
85 0.025*
free transaction
(ii) Phone bill service from
payment member banks “
(landline and among all
mobile) 84 0.043* others given.

(iii) Water bill

payment
72 0.002*
(iv) ISP bill
payment 80 0.409*
(v) School fee
90 0.005*
payment
(vi) Discounts in
payments
from credit 90 0.037*
cards

(vii) Free
transaction
service from
the member
banks

24
 Chi- Square Test

Description N P- Value Conclusion

Frequency of 80 0.042 It is true to the
usage and phone population and
bill payment frequency of use
facility is and phone bill
associated payment facility is
associated.
Frequency of 80 0.033* It is true to the
usage and school population and
bill payment frequency of use
facility is and phone bill
associated payment facility is
associated.
Frequency of 80 0.032* It is true to the
usage and free population
transaction facility Frequency of
are associated usage and free
transaction facility
are associated
Frequency of 80 0.047* It is true to the
usage and population
electricity bill Frequency of
payment facility usage and
are associated electricity bill
payment facility
are associated
Frequency of 80 0.024* It is true to the
usage and population
discount on Frequency of
payments from usage and
credit cards discount on
facility are payments from
associated credit cards
facility are
associated

25
Frequency of 80 0.624** It is not true to the
usage and ISP bill population hence
payment facility the frequency of
are associated use and ISP bill
payment facility is
not associated.
Frequency of 80 0.020* It is true to the
usage and water population
bill payment Frequency of
facility are usage and water
associated bill payment
facility are
associated

Correlation

Description N Pearson P- Value Conclusion

Correlation
Satisfaction 80 0.030 0.020 It is true to the
and phone population and
bill payment Satisfaction
are related and phone bill
payment are
related
Satisfaction 80 0.081 0.000 It is true to the
and school population and
bill payment Satisfaction
related and school
bill payment
related
Satisfaction 80 0.98 0.045 It is true to the
and free population and
transaction Satisfaction
service from and free
member transaction
banks facility service from
is related member
banks facility
is related
Satisfaction 80 1.0 0.370 It is true to the
and discount population and
while Satisfaction
payment and discount
while
26
from credit payment from
card facility is credit card
related facility is
related
Satisfaction 80 -0.30 0.849 It is not true to
and ISP bill the population
payment hence ISP bill
facility is payment
facility and
related
satisfaction is
not related.
Satisfaction 80 0.79 0.389 It is true to the
and population and
electricity bill Satisfaction
payment and
facility is electricity bill
related payment
facility is
related
Satisfaction 80 0.04 0.432 It is true to the
and water bill population and
payment Satisfaction
facility is and water bill
related payment
facility is
related

27
** = 95% confidence level

* = 99% confidence level

3.2 CONCLUSION

Credit card is valued by the customers if it provides them with the services
or facilities more than what they have been providing now. It is seen that
there are many factors which customers look for to bring them satisfaction
on the use of credit card of NIBL. The present customers are dissatisfied
with the present service provided by the credit card of NIBL. Even though
the customers are dissatisfied with the present service of the credit card of
the bank but the prior bad experience of the credit card use is not much.
The customer are dissatisfied may be because of the less facilities provided
on the use of credit card. Even for those who have faced the bad experience

28
with the use of credit card they say that it is have no effect on its usage in
the future if the bank comes up with the new services of credit card.

Given the choices of services like, phone bill payment facility, free
transaction service from the member banks facility, electricity bill payment
facility, discount on payments from credit cards, ISP bill payment facility,
water bill payment facility and school bill payment facility, “discount in payment
from credit card and free transaction service from member banks” is preferred the most among
all others given.

Till the customers are not satisfied with the service its usage will be affected coz the usage of
credit card is determined by the satisfaction of the customer on the use of credit card. Here those
satisfactions includes the facilities to be provided such as phone bill payment facility,
free transaction service from the member banks facility, electricity bill
payment facility, discount on payments from credit cards, water bill
payment facility and school bill payment facility. These excluding the ISP bill
payment are all associated with their frequency of use. Similarly, those are
also related to the satisfaction of the use of credit by the customer. Till the
customers do not get those facilities in the credit card they will not be
satisfied with the services of credit card.

3.3 RECOMMENDATION

Based on our survey and the key highlights of the factors that needs to be
taken into consideration by the bank, few recommendations have been
given below in order for NIBL to solve the problem of value adding
29
proposition of the credit card which is derived by the satisfaction to the
present credit card customers.

The recommendations for NIBL are:

1. Though customers are dissatisfied with the service of the credit card
of the bank but it is seen that not much of the customers have such
bad experience and its usage is not going to get affected in the future
which shows that NIBL has the potential for the increment of the credit
card usage in future if it is able to provide with the facilities they have
asked for.

2. Those facilities viz. phone bill payment facility, free transaction

service from the member banks facility, electricity bill payment
facility, discount on payments from credit cards, water bill payment
facility and school bill payment facility are related with the satisfaction
of the use of credit card to the customers and those are also
associated with the frequency of its use by the customers so until and
unless NIBL does not introduce new facilities in their credit cards the
frequency of its use is not going to increase. So, NIBL needs to
introduce new facilities in their credit card.

3. Among all the services that were mentioned, customers have more
preference for “discount in payment from credit card and free transaction
service from member banks”. So the bank should give these facilities the
first priority while introducing with new facilities of the credit card.

30
ANNEX

31
ANNEX 1: SURVEY QUESTIONNAIRE

Case No: _____

SURVEY QUESTIONNAIRE

Dear Respondent:

We are conducting a survey on Nepal Investment Bank Ltd. and would

like to know your views and opinions. Would you mind spending a few
minutes helping us by completing this questionnaire? All your answers
will be treated confidentially.

Age: __________

Sex: __ Male __ Female

1. How often do u use NIBL’s credit card?

 Almost Every day Once a week  Once a month  in more

than a month

32
 2. Have you had any bad experience with the credit of NIBL?

Never Sometimes Occasionally Often Always

1 2 3 4 5

3. Will you not use Credit card of NIBL in future if it provides new
facilities?

I definitely I might Not at all

will

1 2 3

4. How satisfied with the facilities of the credit card?

Very Quite Neither satisfied Quite Very

Satisfied satisfied nor dissatisfied dissatisfied dissatisfied

1 2 3 4 5

5. Rate your preference of the following facilities of credit card. (1 to the

most preferred and 7 to the least preferred)

33
 Electricity bill payment from credit cards ____________________

Phone bill payment (landline and mobile) ____________________

Water bill payment ___________________

ISP bill payment ___________________

School fee payment ___________________

Discounts in payments from credit cards __________________

Free transaction service from the member banks

__________________

6. I will use credit card frequently if NIBL provides the facility of “ free
transaction service form any member banks”

5--------------4----------------3----------------2----------------1

7. I will use credit card frequently if NIBL provides the facility of “

discount in payments from the credit cards”

5--------------4----------------3----------------2----------------1

8. I will use credit card frequently if NIBL provides the facility of “ school
fee payment from credit card”

5--------------4----------------3----------------2----------------1

9. I will use credit card frequently if NIBL introduces the facility of “ISP
bill payment”

5--------------4----------------3----------------2----------------1

10. I will use credit card frequently if NIBL introduces the facility of “ water
bill payment”

11. 5--------------4----------------3----------------2----------------1

12. I will use credit card frequently if NIBL introduces the facility of “
Electricity bill payment”

34
 5--------------4----------------3----------------2----------------1

13. I will use credit card frequently if NIBL introduces the facility of “Phone
bill payment”

5--------------4----------------3----------------2----------------1

14. I will be satisfied if NIBL introduces the above facilities of Credit

card.

Very Quite satisfied Neither satisfied nor

Satisfied dissatisfied

1 2 3

35