Service Failure at Axis Bank: A Celebrity Lesson
Dipika Pallikal (Dipika) was the top-seeded Indian squash player and the first Indian woman among the top ten of the WSA rankings. Arjuna Awardee (2012) Dipika was the youngest ever Padma Shri awardee (2014) too. Born on September 21st 1991 in Chennai (Tamilnadu state, India), Dipika was playing squash from the age of ten. She grew up in a sports environment at home as her mother Susan was the captain of the Indian women’s cricket team and her father Sanjiv Pallikal played college-level cricket.
She played her first international squash tournament in London, 2003. In 2012, she became the first Indian to reach the finals of the Tournament of Champions squash meet in New York.
Dipika turned into a professional player in 2006 by joining WSA at the age of 15. She featured as a qualifier in the first round of the Hurghada International and Los Angeles Open before winning the British Junior U17 Open in 2008. Her first WSA World Tour title came in 2010 at the Indian Challenger No5 in India where she beats the then top two players Sharon Wee (Malaysia) and Emma Beddoes (England).
In 2011, she won the Equinox Orange County Open and the Dread Sports Series in United States. In the same year, Dipika reached the quarter-finals in the World Open in Rotterdam. Dipika continued her winning streak at various prestigious championships viz., the Crocodile Challenge Cup, Hong Kong (Winner-2011); Tournaments of Champions, United States (2012-Runner Up); Australian Open, (2012- Semi-finalist); Meadow Pharmacy Open, Canada (2013); Macau Squash Open, China (2013); Winipeg Winter Club Open, Canada (2015)........
The First Ordeal
In 2011, Dipika visited Rotterdam, Holland and participated in the Cathay Pacific Sun Hung Kai Squash Open championship. She initially stayed at the Brainpark Hotel, Rotterdam. Before her first round play she had to relocate to another hotel. She used her Axis Bank debit card to settle the hotel bills of about 490 Euros. The card was declined and the transaction did not go through. Dipika was surprised since she had sufficient balance in her account. The situation embarrassed her......
The Nightmare Continues
A month later in 2011, Dipika deposited a cheque of INR100,000 (1355 Euro) to be credited to her Axis bank account. The cheque was an award by Union Sports Ministry, Government of India, for her contribution to the field of sports. Axis bank did not credit the money and instead returned the cheque stating ‘not drawn to us’. After some persuasive correspondence from Dipika, Axis bank eventually credited the amount to her account. Axis bank defended its failure in honouring a government cheque to a ‘technical error’...........
Bank’s Defence
Refusing to accept any blame, Axis Bank adopted a fault finding approach. In its affidavit filed in the court, the Bank stated: “The very fact that the complainant is not able to take the slightest disturbance would prove that she lacks the requisite mental toughness of a world champion.” It attributed the debit card transaction failure to an ‘act of God’. Axis Bank went on to say, “She is only making excuses for her non-performance and it is unfortunate and unethical to allege criminal acts on the bank for a technical failure that took place in a foreign soil on which bank has no control.”......
Service Industry in India
The services sector contributes 66.1% to India’s Gross Value Added growth (GVA in 2015-16) and has emerged as the largest and fastest growing sector of the Indian economy. Besides being the dominant sector, it has also contributed substantially to foreign investment flows, exports, and employment. India’s services sector encompasses a variety of businesses. Some services like IT and telecommunications are very sophisticated, involving high technology and expertise, while some are simple like those of barbers and plumbers..........
Emergence of Axis Bank
Axis Bank (formerly UTI Bank) was among the first new generation private sector banks operationalized in 1994. The Bank was jointly promoted in 1993 by government entities Specified Undertaking of Unit Trust of India (SUUTI) (then known as Unit Trust of India), Life Insurance Corporation of India (LIC), General Insurance Corporation of India (GIC), National Insurance Company Ltd., The New India Assurance Company Ltd., The Oriental Insurance Company Ltd. and United India Insurance Company Ltd.........
Debit Card Operation
There are three types of Debit cards each supported with a distinct transaction technology. They are online debit cards, offline debit cards and prepaid debit cards. Most debit cards are online cards in which funds are immediately deducted from the consumer’s deposit account. Offline cards come with a delayed settlement similar to credit cards. The third variety is prepaid cards (smart card) where prefixed denominations apply and one cannot use the card beyond the prefixed limit (it’s as good as a gift card). Consumer’s bank account is not debited in the case of purchase. The card value diminishes by the amount of the transaction.........
The Brand Suffers a Setback
Over the recent past, Axis Bank was investing in brand building efforts by advertising through the print and electronic media. According to Harish Bijoor, Brand Expert and CEO, opined “Issues such as this (Dipika Pallikal issue) ruin reputation. Axis Bank is in the news for the wrong reasons due to this issue. The issue seems to be one of non-performance as far as the bank is concerned” According to him, the problem is more a lack of service mechanism in place than a failed transaction.......
The Impact of Absence of Recovery Strategy
On March 24th 2014, Dipika won her long-drawn legal wrangle against Axis Bank in the consumer court of District Consumer Redressal Forum, Chennai. Holding Axis Bank responsible for deficient service, the consumer court ordered the bank to pay a compensation of INR500,000 to Dipika as well as INR5,000 towards costs.........
Discussion Questions
Based upon the above information discuss the following questions:
I. What are service expectations of customers like Dipika from bank?
II. What are the challenges of service delivery?
III.......
Exhibits
Exhibit I: Debit Card Transaction
Annexure
Annexure I: Card Transaction Cycle
Annexure II: Master Card