The biggest benefits to the bank are saved costs, reached a new segment of population, efficiency, enhanced the bank reputation in order to provide better customer service and increased customer satisfaction (Ngandu, 2012). The cost of internet transactions was less than the cost of branch transactions (Ngandu, 2012). Internet banking enhanced the relationship between the bank and the customer, because bank provided service directly to customers. Even customers not able to personally appeared at physical branch, this would create customer loyalty (Yohannes, 2010). Internet banking services are a must for banks due to increased online service provided by other financial institutions, for example insurance companies (Raghunandan, 2012).
For this reason, most countries regulate the various functions in a bank. There are various payment services that are usually provided by a bank. The main services include borrowing, lending and cash transfers. The growth in technology has led to the advent of computers which is one of the technologies that has been fully embraced by the banking sector. As the computers get more sophisticated by the day, so does the impact of using technology in banking.
It offers many benefits to banks as well as to customers. Consumer’s use of Internet banking requires acceptance of the technology which can be complicated because it involves the changing of behavioral pattern. Moreover, it could be difficult for some consumers to understand internet technology. Besides that, the consumers also need to understand the complex nature of financial services. At the same time, Internet banking services must be compatible with the individual’s values, customs and past experiences in order to adopt it.
So, the banks need to add more functions to prove their readiness to offer e-banking services to their clients (Maugis et al., 2004). Banks and other financial institutions have always tried to utilize technology initially for internal use and communication and then as a vehicle for external communication and transactions with their customers (Giannakoudi, 1999). In the early 1990s, banks turned their interest to computer technology, and were able to offer services through personal computers owned and operated by customers at their convenience through the use of internet propriety software (Salhieh, et al,
The bank makes use of the internet as means to increase business status for innovation (Yakhlef, 2001). It is easier for bank to introduce new products and services thereby attracting new customers. But innovations in banking products can be easily replicated and therefore make it hard to sustain a leading edge over their rivals (Lymperopoulos and Chaniotakis). 2.10.5 Consumer acceptance of internet banking On searching literature review we found different factor that encourages consumer to use and accept internet banking channel. Li et al (1999) argued that understanding of the internet channel, convenience, perceived accessibility, familiarity and utility are key factors that influenced the adoption of electronic banking by consumer.
Quick response and personal contact are also significant for establishing good relationship and gaining trust and loyal customers. This dimension also implies that internet banks should pay more attention to customer’s email, phone calls and personal contact face to face when problems occur. Banks should reply to customer’s email as soon as possible and provide proper information when customers need some advice. In transaction processing people usually start adopting with traditional banking application because they feel comfortable when they actually see the money change hands as compared to online banking wherein all the proof that they get about their transactions is the receipt provided to them by the site after completion of a certain transaction. A part from descriptive analysis, regression and correlation
LITERATURE REVIEW Dr C. Paramasivan (2009) in his studies entitled “customer satisfaction through information technology in commercial banks” highlighted that, bank account holders are somewhat satisfied with the services provided by their banks and the banks should try to enhance their services in order the satisfy their customers in a cost effective way with the help of information technology. Mishra (2005) in his paper stated the benefits and the security concerns of online banking. According to him increased customer loyalty, improved customer access, attracting new customers, offering of more services are the primary drivers of online banking. But in a survey conducted by the online banking association, member of institutions rated security
In 1978, HSBC has converted from manual book keeping to a computer system in order to simplify the work. Since 1990’s till 20th century, there are a lot of competitors in banking industry. Therefor, HSBC implemented for a better management decision. Under this theory consist of a series of decision-making for the best inputs for most appropriate decisions. In order to attract more customers to do banking with HSBC, the operation management teams use quantitative techniques to resolve and to boost in sales by introduce a new product that is new in the market and at the same time can increase HSBC financial.
In recent years the rapid development of information technology through internet, liberalization & globalization has triggered the ways of doing business. Today distance and time barriers have almost vanished and the world has become an integrated community of buyers and sellers. 1.1.1 E-COMMERCE IN BANKING Internet has revolutionized every industry significantly in the last decade & banking industry is one among them . Products and services are radically shifted to digital form and delivered through the internet. It offers an interactive platform with its diverse electronic service s that enables the customers to get attracted towards it and move to the forefront of technology priorities.
The relationship between e-banking and service quality can be studied with the level of satisfaction. E-banking plays a pivotal role in giving satisfaction to the customers because e-banking fills the gap between the expected and perceived service quality. So in order to fill this gap, banks should find ways of making electronic services more accessible and by allowing the customer to verify the accuracy of the e-banking transactions. There are number of reasons due to which customer satisfaction on account of e-banking has improved. The reasons are as follows; 1.