Evaluating the Impact of ESOP Financing on Customer: A Case Study on Bajaj Finserv

Srijan Sahai; Jyoti Mishra

doi:10.36948/ijfmr.2025.v07i03.44846

Evaluating the Impact of ESOP Financing on Customer: A Case Study on Bajaj Finserv

Author(s)	Mr. Srijan Sahai, Dr. Jyoti Mishra
Country	India
Abstract	This study investigates the impact of Employee Stock Ownership Plans (ESOPs) on customer retention within the financial services sector, with a focus on Bajaj Finserv as a case study. While ESOPs are well documented for enhancing employee motivation and organizational performance, their indirect effects on customer loyalty remain underexplored. This research addresses this gap by analyzing primary data from Bajaj FinServ customers through a quantitative approach, employing SPSS for statistical evaluation. Methodologies included descriptive statistics, reliability analysis (Cronbach’s alpha = 0.91), factor analysis, regression modelling, and group comparisons (ANOVA/t-tests). Key findings reveal that ESOP participation significantly correlates with heightened employee motivation (β = 0.45, p < 0.01), which, in turn, drives service quality improvements (R² = 0.62) and strengthens customer retention (β = 0.71, p < 0.001). A mediated relationship was identified, with service quality accounting for 65% of ESOPs’ indirect impact of ESOPs on retention. Demographic analysis highlighted that higher-income customers (₹5–10 lakh) and long-term clients (>7 years) exhibited stronger loyalty to ESOP-backed institutions, associating ESOPs with enhanced transparency and ethical practices. This study underscores the dual role of ESOPs in aligning employee incentives with customer-centric outcomes, offering actionable insights for financial institutions to leverage ownership models as strategic tools for loyalty enhancement. Limitations include the cross-sectional design and geographic focus on India, suggesting the need for longitudinal and cross-cultural research. These findings advocate the integration of ESOPs with robust training and ethical governance to maximize retention benefits, positioning employee ownership as a critical differentiator in competitive financial markets.
Keywords	ESOPs, customer retention, financial services, service quality, employee motivation, Bajaj Finserv.
Field	Business Administration
Published In	Volume 7, Issue 3, May-June 2025
Published On	2025-05-16
DOI	https://doi.org/10.36948/ijfmr.2025.v07i03.44846
Short DOI	https://doi.org/g9kfv6

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Evaluating the Impact of ESOP Financing on Customer: A Case Study on Bajaj Finserv

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