A STUDY ON PERCEPTION OF CUSTOMERS ON E-BANKING

Introduction:
The paper aims to study the impact of e- banking on customers; the paper also examines the
various dimensions/criterias that reflect the success of e- banking. In todays scenario e banking
plays a vital role as there is paramount importance given to the technology.
There is great emphasis/importance to e banking because it has huge potential market to cover,
which gives convenience, time and cost saving. The study on e banking emphasizes on the
benefits a customer is getting & also the hurdles a company is faced while rendering the services.
The secondary study aims to provide a better understanding of how online banking services
work. It gives insight about the products and services that are covered under the E-banking.
The purpose is achieved with the help of secondary data and the research conducted by
researcher institutes and research scholars. It focuses on attributes/dimensions to be considered
for a better e banking services. It involves various attribute like transparency in transactions,
trust, and reliability.
Data was collected from the research article already made on e banking. It comprises observation
and interaction with the websites, focusing on feedback from the customers using the banking
websites. The findings showed that the main benefits included lower costs, efficiency and time
saving; safer mode of payment .From the findings it has been advised that, banking industry
should have clear and brief information of e banking products and services in order to build trust
with the customer.

BACKGROUND
Electronic commerce (E-commerce) is simply referred to buying and selling using the Internet;
people immediately think of consumer retail purchases from companies such as Amazon.
However, e-commerce involves much more than electronically mediated financial transactions
between organizations and customers. Many commentators now refer to e-commerce as both

financial and informational electronically mediated transactions between an organization and any
third-party it deals with.
E-Banking may include ATMs, wire transfers, telephone banking, electronic funds transfers and
debit cards. The Internet offers the potential for safe, convenient new ways to shop for financial
services and conduct banking business, any day, any time. However, safe banking online
involves making good choicesdecisions that will help you avoid costly surprises or even scams.
In Pakistan e-Banking has started taking.

Online Banking Services: E-commerce task force has been formulated and the Banks have
expanded their online branch networks. In the past 2-3 years Banks have also launched Internet
Banking and the internet banking is now improving with more sophistication and services for
corporate banking customers.
The system that enables financial institution customers, individuals or businesses, to access
accounts, transact business, or obtain information on financial products and services through a
public or private network, including the internet.

History of e banking: Way back to 1980s the concept of e banking was originated, later in
India it became famous after the 1990s new economic policy. The term online became popular
in the late80s and referred to the use of a terminal, keyboard and TV (or monitor) to access the
banking system using a phone line.
Online banking or internet banking allows customers to conduct financial transactions on a
secure website operated by their retail or virtual bank, credit union or building society. EBanking may include ATMs, wire transfers, telephone banking, electronic funds transfers and
debit cards. The Internet offers the potential for safe, convenient new ways to shop for financial
services and conduct banking business, any day, any time. However, safe banking online
involves making good choicesdecisions that will help you avoid costly surprises or even scams.

E-Banking

Delivery of banks services to a customer at his office or home by using electronic technology
can be termed as e-banking. The quality, range and price of these e-services decide a banks
competitive position in the industry. The virtual financial services can be largely categorized as
follows:
Automated Teller Machines:
- Cash withdrawals
- Details of most recent balance of account
- Mini-statement
- Statement ordering facility
- Deposit facility
- Payments to third parties
EFTPoS: EFTPoS card used to initiate transactions:
- Authorization and transaction capture processes take place electronically.
- Transaction confirmed manually.
- Funds not debited electronically.
Remote Banking Services:
- Balance enquiry
- Statement ordering
- Funds transfer (payment) to third parties
- Funds transfer between customers different accounts
- Order travelers cheques and other financial instruments.
Services Not Available Through Remote Banking:
- Cash withdrawal
- Cash deposit
- Sale of the more complex types of financial services such as life insurance mortgages and
(pensions).
Smart Cards:
(i) Stored value cards
(ii) As a replacement for all types of magnetic stripes cards like ATM Cards, Debit/Credit Cards,
Charge Cards etc.
- One smart card to carry out all these functions
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- One smart card can contain the functionality of several different types of cards issued by
different banks while running different types of networks.
- Smart card a truly powerful financial token, giving user access
- STM
- Debit facility
- Charge facilities
- Credit facilities
- Electronic purse facilities at national and international level.

Various Ways to offer Internet banking: First, an existing bank with physical offices
can establish a web site and offer Internet banking in addition to its traditional delivery channels.
Second, a bank may be established as a branchless, Internet only or virtual bank. Broadly the
levels of banking services offered through Internet can be categorized in three types:
(i) The Basic Level Services use the banks websites which provides information on different
products and services offered to customers and members of public in general. It may receive and
reply to customers queries through e-mail.
(ii) In the next level are Simple Transactional Websites which allow customers to submit their
instructions, applications for different services, queries on their account balances, etc, but do not
permit any fund-based transactions on their accounts.
(iii) The third level of Internet banking services are offered by Fully Transactional Websites
which allow the customers to operate on their accounts for transfer of funds, payment of different
bills, subscribing to other products of the bank and to transact purchase and sale of securities,
etc. Most of the banks providing Internet banking product and services offer, to a large extent, an
identical and standard package of banking services and transactional capabilities (Reserve bank
of India)

Unique features of e banking:

1. It removes the traditional geographical barriers as it could reach out to customers of different
countries / legal jurisdiction. This has raised the question of jurisdiction of law / supervisory
system, to which such transactions should be subjected.
2. It has added a new dimension to different kinds of risks traditionally associated with banking,
heightening some of them and throwing new risk control challenges.
3. Security of banking transactions, validity of electronic contract, customers privacy,
etc., which have all along been concerns of both bankers and supervisors have assumed different
dimensions given that Internet is a public domain, not subject to control by any single authority
or group of users.
4. It poses a strategic risk of loss of business to those banks, who do not respond in time, to this
new technology, being the efficient and cost effective delivery2 mechanism of banking services.
5. A new form of competition has emerged both from the existing players and new Players of the
market who are not strictly banks.

INDIAN SCENARIO:
Internet banking, both as a medium of delivery of banking services and as a strategic tool for
business development, has gained wide acceptance internationally and is fast catching up in India
with more and more banks entering the nation. India can be said to be on the threshold of a major
banking revolution with net banking having already been unveiled. Most of banks including
public sector undertaking are offering the e banking services and products. Recently corporation
bank was successful in establishing branchless bank (2500 branches) and was able to help the
rural people to create bank accounts.
At present, the total Internet users in the country are estimated at 4 Crores. However, this is
expected to grow exponentially to 12 Crores by 2012. Only about 1% of Internet users did
banking online in 1998. This increased to 16.7% in March 2000. The facility of accessing their

accounts from anywhere in the world by using a home computer with Internet connection, is
particularly fascinating to Non-Resident Indians and High Net worth Individuals having multiple
bank accounts.
Costs of banking service through the Internet form a fraction of costs through conventional
methods. Rough estimates assume teller cost at Re.1 per transaction, TM transaction cost at 45
paisa, phone banking at 35 paisa, debit cards at 20 paisa and Internet banking at 10 paisa per
transaction. The cost-conscious banks in the country have therefore actively considered use of
the Internet as a channel for providing services. Fully computerized banks, with better
management of their customer base are in a stronger position to cross-sell their products through
this channel.
The e-banking services are being initiated by banks like ICICI Bank Ltd., HDFC Bank Ltd.
Citibank, Global Trust Bank Ltd., UTI Bank Ltd., Bank of Madura Ltd., Federal Bank Ltd. etc.
Recent entrants in Internet banking are Allahabad Bank (for its corporate customers through its
All net service) and Bank of Punjab Ltd. State Bank of India has announced that it will be
providing such services soon. Certain banks like ICICI Bank Ltd., have gone a step further
within the transactional stage of Internet banking by allowing transfer of funds by an account
holder to any other account holder of the bank.
The online population has increased from just 500,000 in 1998 to 5 million in 2000. By 2015, the
online population is expected to reach 70 million. IT services is a $1.5 billion industry in India
growing at a rate of 55% per annum. Keeping in view all the above developments, Internet
banking is likely to grow at a rapid pace and most banks will enter into this area soon. Rapid
strides are already being made in banking technology in India and Internet banking is a
manifestation of this.
Recently corporation bank came up with the concept of branchless banking /virtual banking with
the use technology; they are able to reach the rural outreach people. The corporation bank has
become successful in branchless banking i.e. (2500 branches) across the country.

In the recent years there has been explosion of Internet based electronic banking applications. It
has been stated that the emergence of new forms of technology has created highly competitive
market conditions for bank providers. However, the changed market conditions demand for
banks to better understanding of consumers' needs.
The concept of electronic banking has been defined in many ways. Electronic banking as the
delivery of banks' information and services by banks to customers via different delivery
platforms that can be used with different terminal devices such as a personal computer and a
mobile phone with browser or desktop software, telephone or digital television. Electronic
banking also commonly known as internet banking or e-banking. Internet Banking, defined as
the delivery of banking services through the open-access computer network (the internet)
directly to customers home or private address. India has experienced phenomenal growth in
recent years. In many ways, e-banking is not unlike traditional payment, inquiry, and information
processing system, differing only in that it utilizes a different delivery channel. Any decision to
adopt e-banking is normally influenced by a number of factors. There have been a lot of
dimensions where the service quality of e banking is measured. Security, transaction accuracy,
user friendliness, and network speed are the critical factors for success in Internet banking.

Security and Privacy: Now days uptake of EC applications in the banking industry is very
slow only because of security and data confidentiality issues have been a major barrier. Security
and privacy are one of the most challenging problems faced by customers who wish to trade in
the ecommerce world. Security in the form of keeping customer safe from an invasion of their
privacy, affects trust and satisfaction. If company wish to maintain customer trust, they need to
keep their promises regarding security and privacy. Since security is closely related to trust,
violations of security norms may backfire in terms of losing customers and negative word-of
mouth. Security perceptions are defined as the subjective probability with which consumers
believe that their private information will not be viewed, store and manipulated during transit
and storage by inappropriate parties in a manner consistent with their confident expectations
(Pavlov 2001). The banking sector was reluctant to use e-commerce applications as they felt that
transactions conducted electronically were open to hackers and viruses, which are beyond their
control. As well as convinced that online services are a mixture of customer insecurities,
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technology investment costs and a lack of market-readiness have all conspired to make ebanking unattractive. In many articles it has been defined that the quality of e-banking has been
judged on the basis of 6 dimensions that is Reliability, Accessibility, User-friendliness,
Privacy/security, Efficiency, Responsiveness and Fulfillment.
An interview held on web security and showed four screen shots of a browser connecting to a
website and asked participants to state if the connection was secure or not secure and to affirm
the motivating factor for their appraisal. It was discovered that about 72 participants cannot tell if
a connection is secure.
In Malaysia it is found that security is main barrier to e-commerce expansion. Security is perhaps
the most feared problem on the internet.Security implementation over the internet is still
considered as a big risk by many financial organizations that are skeptical about the technologies
available. However, with the introduction of new technologies such as SSL, digital signature,
encryption, firewalls, PKI infrastructure, etc. internet security can be resolved, but it will take
some time. It is noted that although consumers confidence in their bank was strong, yet their
confidence in the technology was weak. Todays consumers are increasingly more concerned
about security and privacy issues. People want to protect their own money and bank their own
exposure. The role of government is to maintain the integrity of and confidence in the whole
system. With electronic cash, just as with paper cash today, it will be the responsibility of
government to protect against systemic risk.
Ganesan and Vivekananda (2009) described a secured hybrid architecture model for the internet
banking using hyper elliptic curve cryptosystem and MD5 is described. Information about
financial institutions, their customers, and their transactions are, by necessity, extremely
sensitive; thus, doing business via a public network introduces new challenges for security and
trustworthiness. Given the open nature of the Internet, transaction security is likely to emerge as
the biggest concern among the e-banks account holders. The rapid growth in account hijacking
and online fraud are on the rise.
The negative publicity damages consumer trust in the online service. Since personal and
financial information can be intercepted and used for fraudulent purposes, online investing
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involves greater security concerns than conventional trading; users need a sense of security when
conducting financial transactions, and it is still one of the major barriers to e-commerce growth
(Lee and Turban, 2002). Perceived security was defined as a threat that creates a circumstance,
condition, or event with the potential to cause economic hardship to data or network resources in
the form of destruction, disclosures, and modification of data, denial of service, and/or fraud,
waste and abuse (Kalakota and Whinston, 1997). Security, which involves the use of technical
advancements like cryptography, digital signature and certificates aimed at protecting users from
risk of fraud, hacking or phishing, has a positive influence on the intention to purchase online
(Lian and Lin, 2008).
Potential customers mentioned Internet security, online banking regulations, consumers privacy,
and banks reputation as the most important future challenges of online banking adoption.
(Aladwani, 2001). Indeed, in Aladwanis (2001) study of online banking, potential customers
ranked Internet security and customers privacy as the most important future challenges that
banks are facing. Perceived usefulness, perceived Web security has a strong and direct effect on
acceptance of internet banking, too. A high level of perceived risk is considered to be a barrier to
propagation of new innovations. Influenced by the imagination-capturing stories of hackers,
customers may fear that an unauthorized party will gain access to their online account and
serious financial implications will follow. According to survey found that UK consumers ranked
the security of banks website as the most important attribute of internet banking service quality.
It is identified that three-quarters of Australian respondents expressed security concerns with
regard to electronic banking. Overall, the literature appears to be unequivocal in its finding that
the level of perceived risk is negatively related to the attitude towards banking on the World
Wide Web. For this reason, this study uses perceived security as a predictor of customer
acceptance.
Electronic banking can also be defined as a variety of following platforms:
(i) Internet banking (or online banking),
(ii) Telephone banking,
(iii) TV-based banking,
(iv) Mobile phone banking, and e-banking (or offline banking).
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Customers access e-banking services using an intelligent electronic device, such as a personal
computer (PC), personal digital assistant (PDA), automated teller machine (ATM), kiosk, or
Touch Tone telephone.

Advantages:
The main advantages of E-banking are:

The operating cost per unit services is lower for the banks.
It offers convenience to customers as they are not required to go to the bank's premises.
There is very low incidence of errors.
The customer can obtain funds at any time from ATM machines.
The credit cards and debit cards enables the Customers to obtain discounts from retail

outlets.
The customer can easily transfer the funds from one place to another place electronically.

E banking benefits in the following areas:

1. Pay Your Bills Online
We can use online banking to pay our bills. This will eliminate the need for stamps and protect
our self from the check being lost in the mail. Most banks will have a section in which they set
up payees. A Prospect will need to fill out the information once, and then they can simply
choose that profile every time to pay a bill online. If the bank will not pay bills online we may
consider paying online through the company.
2. View Transactions

Online banking allows us to access your account history and transactions from anywhere. This is
the quickest way to check and see if a transaction has cleared our account. It also allows us to
find out about unauthorized transactions more quickly. This can help us to resolve the issues
more quickly.
3. Transfer Money between Accounts
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Online banking also allows us to transfer money between accounts much more quickly. It is more
convenient than using the automated phone service, and can save a trip to the bank. When we
apply or set up our online banking, be sure that all of the accounts we have at the bank are listed.
This will make it easier to transfer money and make loan payments online.
4. Do online trading:
With the help of e banking, a customer can trade and do transactions very comfortably. If a
customer want to trade in security market e banking helps in carrying out the transactions
through the electronic mode. Payment towards purchase of securities and receipt of money
towards sale of securities can be made with the help of e banking.

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Identification of the problem: A STUDY ON PERCEPTION OF CUSTOMERS ON E

BANKING
The study primarily aims to study the perception of customer towards e banking. It also identifies
the key factors that are required for the success of e banking products and services.
The objective of the study is as follows:

To study the perception of customers on e banking.

The secondary objective is to identify the factors that are successful in rendering e
banking.

LITERATURE REVIEW
1. Service quality evaluation in internet banking: an empirical study in India Int. J.
Indian Culture and Business Management,( 2009) Vol. 2, No. 1,
The existing article defines that the role played by internet technology in bringing changes in the
banking industry is remarkable. The adoption of the internet in industries has removed constraint
like time, distance and communication. Internet banking allows banking from anywhere, anytime
and is used for transactions, payments, etc. over the internet through a bank. In e banking the
client has one to one interaction with the banks website, and in such a situation it is essential on
the part of the bank to provide quality information over the internet. Compare to traditional
banking the E- banking involves non human interactions between customers and online banking
information system.
Internet banking is a new delivery channel for banks in India. The E-banking channel is both an
informative and a transactional medium. The development of e banking in India: way back to
1990s when government introduced LPG model, the economy was opened for world economy.
Lots of improvements took place in the banking sector particularly in e banking. On the basis of
recommendations made by c. Rangarajan committee report on computerization and
modernization of banks , many changes were made in banking industry in the areas like
NEFT,BANKNET, SWIFT, ATM,E-banking.
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The RBI had setup a working group on e-banking to examine different aspects of e-banking. The
group focused on 3 major areas like: technology and security issues, Legal issues, regulatory and
supervisory issues.
Service quality dimensions in e banking. It is identified five online service quality dimensions
(responsiveness, reliability, competence, access and security). Trust significantly affects attitude
towards e banking acceptance.
Based on 6 dimensions the quality of e banking was evaluated:

Reliability
Accessibility
User-friendliness
Privacy/security
Efficiency
Responsiveness
Fulfillment

The result indicates that the two dimensions, viz. Privacy/Security and Fulfillment are not
contributing significantly towards the overall service quality. In the coming years the role of ebanking will have paramount importance.
2. Internet Banking Adoption in an Emerging Economy: Indian Consumers
Perspective.(2011) International Arab Journal of e-Technology, Vol. 2, No. 1,
January
The current article emphasis on (IB).Internet banking is a radical technological innovation with
potential to change the structure and nature of banking. Customer satisfaction and customer
retention are the key factors and success mantra of every organization.

IB refers to systems that enable bank customers to get access to their accounts and general
information on bank products and services through the use of banks website, without the
intervention inconvenience of sending letters, faxes, original signatures and telephone
confirmations.
A study on the Internet users, conducted by Internet and Mobile Association of India (IAMAI),
13

Found that about 23% of the online users prefer IB as the banking channel in India, second to
ATM which is preferred by 53%. Out of the 6,365 Internet users sampled, 35% use online
banking channels in India. This shows that a significant number of online users do not use IB,
and hence there is a need to understand the reasons for not using it.
Internet is the cheapest delivery channel for banking products as it allows the entity to reduce
their branch networks and downsize the number of staff. The main focus is on reducing the
transaction cost, Minimizes the inconvenience. The banks like ICICI, HDFC have realized the
importance of e banking, they are spending huge amount on the technology to enable banking
products, services to the customers.
The main objective was to evaluate those factors that manipulate the nature of customers towards
online banking and their growing tendency towards the online financial institutions.
Use of IB comprises of perceived risks, perceived ease of use, perceived usefulness, consumer
acceptance. For the purpose of Sample: convenience sampling was used. The sample for the
study is the students from an educational institute. Reason for choosing the method being, first it
offers an easy way to obtain the raw data for the further analysis. Second it saves times and costs
since the respondents can be randomly selected. Spss package was used to analyze the data and
to interpret the data. The study revealed that online banking is perceived as useful, customers
intention to adopt it would be greater. E-Banking provides flexibility in performing financial
transaction, fast and easy. But customers have the fear of risk involved in the transactions.
The finding of the article showed that PU, PEU and PR are the important determinants of online
banking adoption.
3. The State of e-Banking Implementation in Nigeria:
A Post-Consolidation Review Journal of Emerging Trends in Economics and Management
Sciences (2010) (1): 37-45 Scholar link Research Institute Journals.
The most widely used e-Banking instrument in Nigeria is e-Payment, particularly the automatic
teller machine (ATM) card. However, with the adoption of e-Banking by all the banks in Nigeria,

14

the volume of cash in circulation has continued to increase pre-and-post bank

recapitalization/consolidation exercise.
Furthermore, some of the 25 banks that survived the exercise were found lately to have depleted
their capital base and have lost credibility before the consumers, e-Banking implementation
notwithstanding. Therefore, in this paper, there has been a review about the state of e-Banking
implementation in Nigeria and evaluate the influence of trust on the adoption of e-Payment using
an extended technology acceptance model (TAM). Similarly, there has been an investigation on
organizational reputation, perceived risk and perceived trust in the management of banks as a
factor for enhancing customer loyalty.
Electronic banking is the provision of banking services to customers through Internet technology.
Through the use of IT, banks now employ different channels such as internet technology, video
banking technology, telephone banking, Automated Teller Machine, and WAP technology to
deliver their services. Report on e-banking system in Nigeria reveals that e-payment machinery,
especially the card technology, is presently enjoying the highest popularity in Nigeria banking
market. According to inters witch statistics, Nigeria has 30million ATM card holders who
conduct over 100 million transactions on the machines every month. Nigeria's 24 banks operate
over 9,000ATM machines across the country's 36 states and Federal Capital Territory.
The findings in this work reveal that perceived ease of use and perceived usefulness are not only
antecedent to ebanking acceptance, they are also factors to retain customers to the use of ebanking system such as organizational reputation, perceived risk and trust.
4. E-banking in developing economy: empirical Evidence from Nigeria Elisha Menson
AUTA PhD Candidate, Centre for Policy and Economic Research, University of
Abuja, Abuja, Nigeria
The paper explores the major factors responsible for internet banking based on respondents
perception on various e-banking applications. It also provides a framework of the factors which
are taken to assess the e-banking perception. Due to emergence of global economy, e business

15

has increasingly become a necessary component of business strategy and a strong catalyst for
economic development.
E-banking has become popular because of its convenience and flexibility, and also transaction
related benefits like speed, efficiency, accessibility, etc. The result of this study shows that ebanking serves several advantages to Nigerian banking sector. The customers (respondents)
perception is that e-banking provides convenience and flexible advantages. It also provides
transaction related benefits like easy transfer, speedy transaction, less cost and time saving.
However, the study shows that the Nigerian customers have security, access, and no enough
knowledge regarding e-banking services rendering by banking sector in Nigeria.
The study suggest that critical infrastructure like power and telecommunication should be
provided and with high level of stability to ensure the application of e-banking in Nigeria. Also,
the relative skewed nature of banks location mostly in urban area should be addressed to ensure
spread and accessibility by rural dwellers.
The concept of e-banking is a delivery channel for banking services. Banks have used electronic
channels for years to communicate and transact business with both domestic and international
corporate customers. With the development of the Internet and the World Wide Web (WWW) in
the latter half of the 1990s, banks are increasingly using electronic channels for receiving
instructions and delivering their products and services to their customers. This form of banking is
generally referred to as e-banking or Internet banking, although the range of products and
services provided by banks over the electronic channel vary widely in content, capability and
sophistication.
Electronic banking can also be defined as a variety of following platforms: (i) Internet banking
(or online banking), (ii) telephone banking, (iii) TV-based banking, (iv) mobile phone banking,
and e-banking (or offline banking).
Commerce carried out in Germany, Buse and Tiwari (2006) observed that: the highest mobile
users are top management, followed by self employed, salaried class, students and others.

16

Chiemeke et al. (2006) conducted an empirical investigation on adoption of ebanking in Nigeria.

The study identified the major inhibiting factors to Internet banking adoption in Nigeria such as,
insecurity, inadequate operational facilities including telecommunications facilities and
electricity supply, and made recommendations on how Nigeria banks can narrow the digital
divide. Also, the report revealed that Internet banking is being offered at the basic level of
interactivity with most of the banks having mainly information sites and providing little Internet
transactional services.
Based on 6 factors the evaluation was done:
1.
2.
3.
4.
5.
6.

Time factor
Security
Queue management
User friendly
Fund transfer
Accessibility

The study revealed that the major criteria to evaluate the quality of services offered through e
banking would be security and time factor, because majority of them are of the opinion that the
banking industry should give more importance to security concerns and timely delivery of
services.
5. Can e-banking services be profitable?
ISSN 14065967ISBN 9985404009Tartu University Presswww.tyk.ut.eeOrder No. 512
Over the last few years European banks have spent billions of Euros on new electronic channels.
However, after some years of excitement it was clear that the banks long-awaited skyrocketing
profits from this area would not be netted. Estonian banks have also invested in expanding and
improving the IT systems and a number of new e-banking services have been developed. Until
recently, most of the pricing decisions for e bank services were made on the basis of a gut feeling
as the current financial management information systems did not support such analysis. In this
article the author explores the implementation techniques of Activity-Based Costing (ABC) in
the banking sector on the example of an Estonian bank in order to analyze the cost structure for
traditional and electronic channel transactions. The article shows how it is possible to implement

17

ABC in banking and proves empirically that electronic channels help reduce the costs of both
banks and their clients. Focus on profitability by reducing the transaction cost.
The current article also emphasis on the importance of the electronic channels in banking
industry. In this article the research was made on the application of activity based costing in the
banking sector. ABC is a cost measurement system that provides the cost of each product, service
or customer by analyzing each activity needed to produce a product or service for the customer.
The ABC has 2 main views cost assignment view and process view.The cost assignment view
reflects the organizations need to trace or allocate resources to activities or cost objects
(including customers as well as products and channels) in order to analyze critical decisions
about such things as pricing, product mix, sourcing, and distribution channel management.
Whereas process view reflects the organizations need for information about events that
influence the performance of activities and activity performance.
Ultimately the research revealed that profitability can be made possible with proper services
rendered by bank. Some proportional data are real free income on transactions.

6. E-Age TechnologyNew Face of Indian Banking Industry: Emerging Challenges and

New Potentials. Journal of Emerging Trends in Economics and Management
Sciences
The present paper analyzes the performance of major banks in terms of productivity and
profitability in the pre and post e-banking period. Under the regime of banking sector reforms, IT
Act of 1999 gave new dimensions to the Indian banking sector. IT has created transformation in
banking structure, business process, work culture and human resource development. It has
affected the productivity, profitability and efficiency of the banks to a large extent. The paper
concludes that performance of all the banks under study is much better in post-e-banking period
and further foreign banks are at the top position, whereas the performance of the public sector
banks is comparatively very poor. The paper suggests some measures to tackle the challenges

18

faced by the banks particularly public sector banks. At the end, paper suggests how public sector
banks can convert the emerging challenges into opportunities.
7. Acceptance of E-banking among Adult Customers: An Empirical Investigation in
India (2008) volume 23.
Internet banking is a form of self service technology. The numbers of Internet users have
increased dramatically, but most of them are reluctant to provide sensitive personal information
to websites because they do not trust e-commerce security. The research paper investigates the
factors which are affecting the acceptance of e-banking services among adult customers and also
indicates level of concern regarding security and privacy issues in Indian context. Primary data
was collected from 200 respondents, above the age of 35, through a structured questionnaire.
Statistical analysis, descriptive statistics was used to explain demographic profile of respondents
and also Factor and Regression analyses were used to know trend of internet use and factors
affecting e-banking services among adult customer in India. The finding depicts many factors
like security & privacy, trust, innovativeness, familiarity, awareness level increase the acceptance
of ebanking services among Indian customers. The finding shows that in spite of their security
and privacy concern, adult customers are willing to adopt online banking if banks provide him
necessary guidance. Based on the results of current study, Banks managers would segment the
market on the basis of age group and take their opinion and will provide them necessary
guidance regarding use of online banking.

Research Methodology
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Identification of problem: A study on perception of customers in e-banking

The research study aims to obtain information regarding the attributes that has to be present in
rendering quality banking services through electronic channels. It consists of trust, reliability,
efficiency, convenience. Many scholars and researchers have used structured questionnaire to
obtain the information regarding the attributes of e-banking.

Data Collection
Within the scope of the research, in the articles researchers used email, observation (interaction
with website) as sources of data collection. In many articles researchers have used the opinion
and feedback that has been posted on the bank websites by the customers regarding the various
products of e banking and all the above was used for the study.

Sample Selection
For the purpose of research researchers had used multiple case sampling, because multiple case
could add confidence to findings. By looking at the range of similar contrasting cases, one can
understand the case findings. The sampling frame chosen were customers who had already been
exposed to at least one online banking transaction.

Data collection:
As the study is based on the research already made on the e banking, the data is collected from
various sources like annual reports, bank websites, customer feedback about the products and
experience in e banking by the customers. In the research article they have used the 5 point
Likert scale technique to obtain and assess the information of attributes.

SECONDARY DATA:

Internal: the sources include company annual reports, bulletins, and research reports.

External: the sources include:

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 Published materials such as periodicals and books like business periodicals, mobile
banking magazine.
Computerized databases such as internet databases.
The respondents were asked to rate on a 5-point Likert scale (1 = Strongly Disagree to 5 =
Strongly Agree).

Data analysis
From the various researches it has been concluded that nearly 60-70% customer rated that, the
banks should focus on security as major attribute in rendering E-banking services. Hence banks
should emphasize on reliability, trust, accessibility, transparency, ease of usage.The percentage of
the customer satisfied with the security and transparency that has been practiced in banks are
rated (56% agreed). Some of them are not satisfied with the security aspects that have been
practiced in the banks.
With regards to transparency 89% of the customers are strongly agreed, transparency as one of
the major attribute that has constituted the attribute of e banking. The respondent claimed that
Internet banking is more convenient as compared to traditional banking. Convenience is a
primary benefit sought by customers. The banks should provide statements of transactions have
been conducted in electronically. The respondent informed that information shown on the
website was understandable and quite clear. Even about offline information was also very clear.
The participant viewed that his time was saved and avoid waiting in queue for his turn in the
bank.

Findings
From the above data analysis, it is clear that banks are rendering quality services to their
customers by introducing more e banking products through electronic channels. At the same time
banks are concentrating on the security issues and various other obstacles that affect the service.

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The quantity of product information should be in short and clear form, so the customer at

the time of reading does not become fed up.

Customers have revealed that most of the benefits obtained from e banking are time
saving, reliability, convenience, greater emphasis on timely process of transactions at a

reasonable rate.
Furthermore, internet banking websites should provide options of exchange rate

conversions, loan calculators (car, house, and mortgage).

The Internet banks should provide homepage hyperlinks for the ease in assessing the

specific information.
It may be better to keep a consistent navigation technique in the entire website. But it will
be even better if internet bank make site map and search engine on the website for

convenience of their customers.

To maintain customers regularly visiting the website, product information must be

furnished in simple text and font.

Normally, search engine depends on the contents. But the specified internet banks have a

lot of information on the web, so they must use search engine.

As far as security is concerned, the banks must use latest technology on their websites.

The research leads to the following specific conclusions emerging from the findings above:
The design and quality of online services can play a vital role in internet banking if the
information about the products and services are to the point and clear.

A link of glossary for technical terms can also be provided.

Demo facility can play an imperative role for this introductory internet banking stage.
The facility of search engine on home page can establish a longer relationship with
customers in Internet banking.

SUGGESTIONS

Due to the latest technology & innovations banking customers are looking forward to use
Internet banking as a safe custodian and care should be taken by the bankers to ensure

security.
Information provided in the websites should be concise and clear about the products and
services to the online visitors.
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Effective customers complaint and query system needs to be enhanced for better
customer service.
Security, trust, reliability, transparency are the vital aspects and dimensions need to be
focused by the banks in rendering services.

Conclusion:
From the above findings, it can be concluded that e banking in todays banking scenario is
gaining momentum. But lots of concerns regarding security, trust has to be given priority. Its
growth is tremendous; the role of internet or e banking is significant. According to the estimate
the growth rate of internet users will reach 60% by 2020. But at the same time there has been a
security threats. So measures to overcome security threats have to be taken care off.
At the end of the research it has been concluded that, for better e banking services banks could
customize the e banking services as per customer requirements to deliver excellence in the
services.

Bibliography:
1. Service quality evaluation in internet banking: an empirical study in India. Int. J.
Indian Culture and Business Management, Vol. 2, No. 1, 2009
2. Internet Banking Adoption in an Emerging Economy: Indian Consumers
Perspective. International Arab Journal of e-Technology, Vol. 2, No. 1, January 2011
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3. The State of e-Banking Implementation in Nigeria: A Post-Consolidation Review

Journal of Emerging Trends in Economics and Management Sciences (JETEMS)
(1): 37-45 Scholar link Research Institute Journals, 2010
4. e-banking in developing economy: empirical evidence from Nigeria Elisha Menson
AUTA PhD Candidate, Centre for Policy and Economic Research, University of
Abuja, Abuja, Nigeria
5. Can e-banking services be profitable? ISSN 14065967ISBN 9985404009Tartu
University Presswww.tyk.ut.eeOrder No. 512

6. Acceptance of E-banking among Adult Customers: An Empirical Investigation in

India: Journal of Internet Banking and Commerce, August 2010, vol. 15, no.2
7. E-Age TechnologyNew Face of Indian Banking Industry: Emerging Challenges and
New Potentials Journal of Social and Development Sciences Vol. 1, No. 3, pp. 115129, Apr 2011
Institutes /bank websites visited:
http://kalyan-city.blogspot.com/2010/09/commercial-banks-definitions-primary.html
http://moneyfor20s.about.com/od/financialinstitutions/tp/Online-Banking.htm
http://kalyan-city.blogspot.com/2011/02/e-banking-online-banking-advantages-of.html
http://kalyan-city.blogspot.com/2011/02/different-types-of-banks-what-are.html
http://www.google.co.in/#hl=en&cp=10&gs_id=10&xhr=t&q=e+banking+ppt&pf=p&sclient=ps
yab&source=hp&pbx=1&oq=e+banking+&aq=0&aqi=g4&aql=&gs_sm=&gs_upl=&bav=on.2,or
.r_gc.r_pw.,cf.osb&fp=4af2d9e6c889c72a&biw=1138&bih=519

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