A STUDY ON CUSTOMER PERCEPTION TO INTERNET BANKING SERVICES IN BANGALORE

Title

A STUDY ON CUSTOMER PERCEPTION TO INTERNET BANKING SERVICES IN BANGALORE

Creator

Sankaran Vidya

Description

In the last few decades, information technologies have changed the banking industry and have provided a way for the banks to offer differentiated products and services to their customers.The advent of technology made the banks which were used to branch based operations for over 200 years,change the nature of financial services offered to its customers. For instance, automated teller machines (ATM) displaced cashier tellers, telephone represented by the call centers replaced the branch banking, the internet replaced mail, credit cards and electronic cash replaced bank transactions. The changes occurring in the banking sector can be attributed to increasing deregulation and globalization, the major stimulus for rationalization, consolidation, and an increasing focus on costs (Ibrahim et al., 2006). Internet Banking also called as on line banking is the new age banking system. Internet banking used the internet as the delivery channel to conduct banking activities like transferring funds,paying bills, viewing account statements, paying mortgages and purchasing financial certificates of deposits (Haque et al, 2009). Banks know that the Internet opens up new horizons for them and moves them from local to global frontiers (Mavri and Ioannou,2006).Banks gain competitive advantage over their rivals by providing electronic banking services as technology induced services reduce cost of operations, removes geographical barriers, provides 24 hours banking, extended hours of business and efficiency in daily banking processes. Without even interacting with the bankers, customers can transact banking activity from any corner of the world. Electronic banking has experienced rapid growth and has transformed the traditional banking practices(Gonzalez et al.,2008).According to Broadie et al(2007) e-banking is leading to a paradigm shift in the marketing practices of banking industry. A professional banking service can be provided only if the background operations are efficient. The background operations can be effective only if it is integrated with an electronic system. The data, hardware, software, network; people are all the essential part of this system. Customers are happy with the system only when it provides them comfort and convenience while transacting with the bank. Internet enabled electronic system facilitate these operation to obtain the result. According to Christopher, E banking has become an important channel to sell the products and services and is perceived to be a necessity in order to stay profitable and successful. The perception is the result of interpreting the experience. There is a growing interest in understanding the users experience (Hiltunen et al.,2002), as it is observed as a larger concept than user satisfaction. From this it is inferred that assessing the user experience is essential for many technological products and services (Wilson & Sasse 2004). Dabholkar (2000) claims that very little are known about customer preference for self service options, particularly those which are technology based. Researchers have found that significant number of customers are either not aware of Internet Banking Services or do not trust IB as a channel to conduct financial transactions. They have also found that customers may adapt the IB services only if they perceive the technology to be useful. This research paper aims to find out the customers perception to internet banking and also tries to examine whether there is any relation between various demographic variables and customers perception about internet banking. The sample consisted of 200 bank customers, 54 from State Bank of India, 44 from ICICI, 27 from HDFC, 19 from other private sector banks, and 56 from other public sector banks. The convenience sampling technique was adopted for selecting the respondents. Tool for measuring the variables was developed by the researcher with the help of previous studies. A questionnaire was developed on a five point likert scale. The reliability and validity of the questionnaire was assessed and found to be 0.7501. The major findings of the study were: 1. There is significant relation between Age and Usage of Internet Banking Services 2. There is significant relation between Profession and Usage of Internet Banking Services. 3. There is no significant relation between Education and Usage of Internet Banking Services. 4. There is no significant relation between Gender and Usage of Internet Banking Services. 5. There is significant relation between Income and Usage of Internet Banking Services. 6. There is significant relation between types of Banks and Usage of Internet Banking Services. 7. There is significant relation between ease of use and satisfaction level of customers of internet banking 8. There is significant relation between operational advantage and satisfaction level of customers of internet banking. 9. There is significant relation between perceived risk and satisfaction level of customers of internet banking. 10. There is significant relation between infrastructure constraints and satisfaction level of customers of internet banking. 11. There is no significant relation between personal limitations and satisfaction level of customers of internet banking. 12. There is significant relation between IB users and their satisfaction level The implication of the study will help Banks to pay more attention towards creating awareness among its customers so that the usage of Internet Banking is increased. Strategies have been detailed in the study.

Source

Commerce

Date

2010