Post on 05-Mar-2023
A STUDY ON CUSTOMERS’ SATISFACTION TOWARDS
E-BANKING WITH SPECIAL REFERENCE TO SBI AND ICICI
BANKS IN THANJAVUR TOWN
A thesis submitted to
BHARATHIDASAN UNIVERSITY
for the award of the degree of
DOCTOR OF PHILOSOPHY
IN
COMMERCE
By
S.BELLARMIN DIANA
[Ref.No.36049/PhD/Commerce/F.T/April 2007/Dated.04.04.2007
Under the Guidance of
Dr.M.SWAMINATHAN, M.Com., M.Phil., M.B.A., B.G.L., Ph.D.,
Associate Professor
P.G. AND RESEARCH DEPARTMENT OF COMMERCE,
A.V.V.M. SRI PUSHPAM COLLEGE (AUTONOMOUS),
POONDI – 613 503, THANJAVUR DISTRICT,
TAMIL NADU, INDIA.
MARCH 2014.
Dr.M.SWAMINATHAN, M.Com., M.Phil., M.B.A., B.G.L., Ph.D.,
Associate Professor,
Department of Commerce,
A.V.V.M. Sri Pushpam College (Autonomous),
Poondi – 613 503.
Thanjavur District.
CERTIFICATE
Date: /03/2014
This is to certify that the thesis entitled A STUDY ON CUSTOMERS’
SATISFACTION TOWARDS E-BANKING WITH SPECIAL REFERENCE TO
SBI AND ICICI BANKS IN THANJAVUR TOWN submitted by S.Bellarmin Diana
Full Time Research Scholar, Department of Commerce, A.V.V.M Sri Pushpam College
(Autonomous), Poondi, is a bonafide record of research work done by him under my
guidance as a full-time research scholar and that the thesis has not previously formed the
basis for the award to the candidate of any degree, Diploma, Associateship, Fellowship or
other similar titles. The thesis represents the independent work on the part of the
candidate.
(M.SWAMINATHAN)
ii
S.BELLARMIN DIANA,
Full – Time Research Scholar,
Department of Commerce,
A.V.V.M. Sri Pushpam College (Autonomous),
Poondi – 613 503.
Thanjavur District
Date: /03/2014
DECLARATION
I do hereby declare that this work has been originally carried out by me under the
supervision of Dr.M.SWAMINATHAN, Associate Professor, P.G. and Research
Department of Commerce, A.V.V.M. Sri Pushpam College (Autonomous), Poondi,
Thanjavur District, Tamil Nadu, affiliated to Bharathidasan University, Tiruchirappalli –
620 024 and this work has not been submitted elsewhere for any other degree.
(S.BELLARMIN DIANA)
Signature of the Candidate
iii
ACKNOWLEDGEMENT
Glory to The Almighty who bestowed the wisdom and health to prepare this
thesis.
I express my deep sense of gratitude to the college administration and staff
members who offered me an opportunity to carry out my research work in the
esteemed institution.
My sincere and heartfelt thanks to my Research Advisor
Dr.M.Swaminathan, Associate Professor in commerce, A.V.V.M. Sri Pushpam
College (Autonomous), Poondi, Thanjavur, whose encouragement and guidance
has been of immense help for me to complete this research.
I offer my gratitude to G.Vijaya Ramalingam, Associate Professor and
coordinator, Department of Commerce, A.V.V.M. Sri Pushpam College,
(Autonomous), Poondi,Thanjavur, for having taken steps to introduce me to the
full time reseach.
I would like to offer my profound regards to Dr.R.Rajendran, Principal,
A.V.V.M. Sri Pushpam College, (Autonomous), Poondi.
I am indebted to Bharathidasan University, Tiruchirapalli for giving
me an opportunity to do fulltime research and for all help.
iv
I cordially thank my beloved parents, sisters and each one of my
family members without whose effort and support the thesis would not have been
successfully submitted.
S.BELLARMIN DIANA
v
LIST OF TABLES
Table No.
Particulars Page No
1.1
Result of cronbac’s alpha 80
2.1
ATMs of scheduled commercial banks as at March end 98
2.2
Bank Group wise ATMs of Scheduled Commercial Banks
99
2.3
Bank group – wise outstanding number of debit cards issued by scheduled commercial banks
113
2.4
Growth of outstanding debit cards in Indian banking 114
2.5
Growth of credit cards in Indian market 131
2.6 Charges applicable on NEFT
172
2.7
Value and volume of NEFT Transactions 173
2.8 Time of Settlement and the Charges per Transaction
178
2.9
Growth of Real Time Gross Settlement Transactions 179
2.10 Growth of Value and Volume of ECS Transactions
189
2.11
Bank group wise technology related fraud 201
3.2.1
Gender-wise classification of respondent 204
3.2.2
Age-wise classification of respondents 205
3.2.3.
Educational qualification of respondents 206
vi
[
3.2.4
Occupational status of respondents 207
3.2.5
Monthly income-wise classification of respondents 208
3.2.6
Marital status of respondents 209
3.2.7
Classification of Respondents on the basis of e-banking facilities 210
3.2.8
Motivational factor to avail e-banking products 211
3.2.9
Number of years of utilization 212
3.2.10 Preference of respondents to e-banking products
213
3.2.11
Reason for preference to e-banking products 214
3.2.12
Frequency of usage in the past three months 215
3.2.13
Occupational status of Internet banking users 216
3.2.14
Occupational status of Credit card users 217
3.2.15
Occupational status of mobile banking users 218
3.2.16
Occupational status of EFT/NEFT users 219
3.2.17 Occupational status of RTGS users
220
3.2.18 Occupational status of ECS users
221
3.2.19
Occupational status of Any Branch Banking 222
3.2.20
Monthly income-wise classification of Internet Banking users 223
vii
3.2.21
Monthly income-wise classification of Credit card users 224
3.2.22
Monthly income-wise classification of Mobile banking users 225
3.2.23
Monthly income-wise classification of EFT/NEFT users 226
3.2.24 Monthly income-wise classification of RTGS users
227
3.2.25 Monthly income-wise classification of ECS users
228
3.2.26
Monthly income-wise classification of Any Branch Banking 229
3.2.27 Respondents’ view on security of electronic delivery channels
230
3.2.28 Respondents’ view on service level improvement
231
3.3.1
Association between age group and number of years of availing e-
banking services
232
3.3.2
Association between occupation and number of years of availing e- banking services
233
3.3.3
Association between age group and frequency of usage 234
3.3.4
Association between occupation and frequency of usage
235
3.3.5
Association between monthly income and frequency of usage 236
4.2.1
Multiple Response Analysis of Awareness towards convenience
services at ATM
244
4.2.2.
Multiple Response Analysis of Awareness towards value added
services at ATM
246
viii
4.2.3
Multiple Response Analysis of Awareness towards Debit card services at POS
248
4.2.4
Multiple Response Analysis of Awareness towards other services of Debit card
249
4.2.5
Multiple Response Analysis of Awareness towards convenience services of internet banking
251
4.2.6
Multiple Response Analysis of Awareness towards value added
services of internet banking
253
4.2.7
Multiple Response Analysis of Awareness towards information based services of mobile banking
255
4.2.8
Multiple Response Analysis of Awareness towards Financial
transaction based services of mobile banking
257
4.2.9
Multiple Response Analysis of Awareness towards convenience
services of credit card
258
4.2.10
Multiple Response Analysis of Awareness towards value added services of credit card
260
4.2.11
Multiple Response Analysis of Awareness towards Benefit services
of credit card
261
4.2.12
Multiple Response Analysis of Awareness towards insurance services of credit card
262
4.2.13
Multiple Response Analysis of Awareness towards Any Branch
Banking services
264
4.3.1
Association between age group and ICICI bank customers’
awareness with respect to dimensions of ATM –cum-Debit card
services
265
4.3.2 Association between age group and SBI bank customers’ awareness
with respect to dimensions of ATM –cum-Debit card services
267
ix
4.3.3
Association between age group and ICICI bank customers’ awareness with respect to dimensions of Internet banking services
269
4.3.4
Association between age group and SBI bank customers’ awareness
with respect to dimensions of Internet banking services
270
4.3.5
Association between age group and ICICI bank customers’
awareness with respect to dimensions of Mobile banking services
271
4.3.6
Association between age group and SBI bank customers’ awareness with respect to dimensions of Mobile banking services
272
4.3.7
Association between age group and ICICI bank customers’
awareness with respect to dimensions of Credit card services
273
4.3.8
Association between age group and SBI bank customers’ awareness
with respect to dimensions of Credit card services
275
4.3.9
Association between gender and ICICI bank customers’ awareness with respect to dimensions of ATM-cum-Debit card services
276
4.3.10
Association between gender and SBI bank customers’ awareness
with respect to dimensions of ATM-cum-Debit card services
278
4.3.11
Association between gender and ICIC bank customers’ awareness
with respect to dimensions of Internet banking services
279
4.3.12
Association between gender and SBI bank customers’ awareness with respect to dimensions of Internet banking services
280
4.3.13
Association between gender and ICICI bank customers’ awareness
with respect to dimensions of Mobile banking services
281
4.3.14
Association between gender and SBI bank customers’ awareness with respect to dimensions of Mobile banking services
282
4.3.15
Association between gender and ICICI bank customers’ awareness
with respect to dimensions of Credit card services
283
x
4.3.16
Association between gender and SBI bank customers’ awareness with respect to dimensions of Credit card services
284
4.3.17
Association between educational qualification and ICICI bank
customers’ awareness with respect to dimensions of ATM-cum-
Debit card services
286
4.3.18
Association between educational qualification and SBI bank
customers’ awareness with respect to dimensions of ATM-cum-
Debit card services
288
4.3.19
Association between educational qualification and ICICI bank
customers’ awareness with respect to dimensions of Internet
banking services
290
4.3.20
Association between educational qualification and SBI bank
customers’ awareness with respect to dimensions of Internet
banking services
291
4.3.21
Association between educational qualification and ICICI bank
customers’ awareness with respect to dimensions of Mobile banking
services
292
4.3.22
Association between educational qualification and SBI bank
customers’ awareness with respect to dimensions of Mobile banking
services
293
4.3.23
Association between educational qualification and ICICI bank
customers’ awareness with respect to dimensions of Credit card
services
294
4.3.24
Association between educational qualification and SBI bank
customers’ awareness with respect to dimensions of Credit card
services
296
4.4.1
Multiple Response Analysis of utilization with respect to convenience services at ATM
297
xi
4.4.2
Multiple Response Analysis of utilization with respect to value
added services at ATM
299
4.4.3
Multiple Response Analysis of utilization with respect to Debit card
services at POS
301
4.4.4
Multiple Response Analysis of utilization with respect to other services of Debit card
302
4.4.5
Multiple Response Analysis of utilization with respect to convenience services of internet banking
304
4.4.6
Multiple Response Analysis of utilization with respect to value
added services of internet banking
306
4.4.7
Multiple Response Analysis of utilization with respect to
information based services of mobile banking
308
4.4.8
Multiple Response Analysis of utilization with respect to financial
transaction based services of mobile banking
310
4.4.9
Multiple Response Analysis of utilization with respect to
convenience services of credit card
311
4.4.10
Multiple Response Analysis of utilization with respect to value added services of credit card
313
4.4.11
Multiple Response Analysis of utilization with respect to Benefit
services of credit card
314
4.4.12
Multiple Response Analysis of utilization with respect to Insurance
services of credit card
316
4.4.13
Multiple Response Analysis of utilization towards Any Branch
Banking services
317
xii
4.5.1
Association between occupation and ICICI bank customers’
utilization with respect to dimensions of ATM-cum-Debit card
services
318
4.5.2
Association between occupation and SBI bank customers’
utilization with respect to dimensions of ATM-cum-Debit card
services
320
4.5.3
Association between occupation and ICICI bank customers’ utilization with respect to dimensions of Internet banking services
322
4.5.4
Association between occupation and SBI bank customers’
utilization with respect to dimensions of Internet banking services
323
4.5.5
Association between occupation and ICICI bank customers’ utilization with respect to dimensions of Mobile banking services
324
4.5.6
Association between occupation and SBI bank customers’
utilization with respect to dimensions of Mobile banking services
325
4.5.7
Association between occupation and ICICI bank customers’ utilization with respect to dimensions of Credit card services
326
4.5.8
Association between occupation and SBI bank customers’
utilization with respect to dimensions of Credit card services
328
4.5.9
Association between monthly income and ICICI bank customers’
utilization with respect to dimensions of ATM-cum-Debit card
services
330
4.5.10
Association between monthly income and SBI bank customers’
utilization with respect to dimensions of ATM-cum-Debit card
services
332
4.5.11
Association between monthly income and ICICI bank customers’
utilization with respect to dimensions of Internet banking services
334
4.5.12 Association between monthly income and SBI bank customers’ utilization with respect to dimensions of Internet banking services
335
xiii
4.5.13
Association between monthly income and ICICI bank customers’
utilization with respect to dimensions of Mobile banking services
336
4.5.14
Association between monthly income and SBI bank customers’
utilization with respect to dimensions of Mobile banking services
337
4.5.15
Association between monthly income and ICICI bank customers’
utilization with respect to dimensions of Credit card services
338
4.5.16
Association between monthly income and SBI bank customers’
utilization with respect to dimensions of Credit card services
340
5.2.1
Respondents interest in complaining about the problem 355
5.2.2 Reason for not making complaints
356
5.2.3
Methods of complaining 357
5.2.4
Number of times complaints made 358
5.2.5
Problems solved by banks 359
5.2.6
Duration of time required for the bank to solve the problem 360
5.2.7
Overall problems of e-banking customers 361
5.2.8
Overall satisfaction of respondents towards problem handling 362
5.3.1
Difference between banks and level of problems with respect to ATM
363
5.3.2
Difference between banks and level of problems with respect to credit card
364
5.3.3 Difference between banks and level of problems with respect to
debit card
365
5.3.4 Difference between banks and level of problems with respect to internet banking
366
xiv
5.3.5
Difference between banks and level of problems with respect to
mobile banking
367
5.3.6
Difference between banks and level of problems with respect to RTGS, NEFT, and ECS
368
5.3.7
Difference between banks and level of problems with respect to Any
branch banking
369
5.3.8
Difference between banks and level of problems with respect to fraud
370
5.3.9
Association between age group and level of Problems with respect
to ATM
371
5.3.10
Association between age group and level of Problems with respect to Credit card
372
5.3.11
Association between age group and level of Problems with respect to DEBIT card
373
5.3.12
Association between age group and level of Problems with respect to Internet banking
374
5.3.13
Association between age group and level of Problems with respect to Mobile banking
375
5.3.14
Association between age group and level of Problems with respect
to fraud
376
5.3.15
Association between occupation and level of Problems with respect to ATM
377
5.3.16
Association between occupation and level of Problems with respect to Credit card
378
5.3.17
Association between occupation and level of Problems with respect to DEBIT card
379
5.3.18 Association between occupation and level of Problems with respect
to Internet banking
380
xv
5.3.19
Association between occupation and level of Problems with respect
to Mobile banking
382
5.3.20
Association between occupation and level of Problems with respect
to RTGS, NEFT and ECS
384
5.3.21
Association between occupation and level of Problems with respect
to fraud
385
6.2.1
Overall level of satisfaction of E-Banking customers 392
6.2.2
Level of satisfaction of ATM-cum-Debit card users 393
6.2.3
Level of satisfaction of credit card users 394
6.2.4
Level of satisfaction of Internet banking users 395
6.2.5
Level of satisfaction of Mobile banking users 396
6.2.6 Level of satisfaction of NEFT users 397
6.2.7
Level of satisfaction of RTGS users 398
6.2.8
Level of satisfaction of ECS users 399
6.2.9
Level of satisfaction of Any Branch banking users 400
6.3.1
Difference between banks and level of satisfaction With respect to E-banking products and Services
401
6.3.2
Difference between male and female e-banking customers With
respect to satisfaction level
402
6.3.3
Difference between married and unmarried e- banking Customers
with respect to satisfaction level
403
6.3.4
Difference between age group with respect to Satisfaction level 404
6.3.5
Difference in satisfaction level of e-banking customers with
different educational qualification
405
xvi
6.3.6 Association between occupation and satisfaction level of E- Banking
customers
406
6.3.7
Association between monthly income and satisfaction level of e-
Banking customers
407
6.3.8
Association between overall problems and satisfaction level of e-
banking customers
408
xvii
LIST OF CHARTS
Chart No.
Particulars Page No
3.2.1
Gender of respondents
204
3.2.2
Age-wise classification of respondents
205
3.2.3.
Educational qualification of respondents
206
3.2.5
Monthly income-wise classification of respondents
209
3.2.9
Number of years of utilization
212
3.2.10
Preference of respondents to e-banking products
213
5.2.7
Overall problems of e-banking customers
361
6.2.1 Overall level of satisfaction of E-Banking customers
392
xviii
LIST OF ABBREVIATIONS
ALPM - Advanced Ledger Posting
ATM - Automated Teller Machine
BIS - Bank for International Settlement
CBS - Core Banking Solutions
CDSL - Central Depository Service Ltd
CMR - Cyber Media Research
DP - Depository Participant
DVSS - Digital Video Surveillance System
EBT - Electronic Benefit Transfer
ECS - Electronic Clearing Service
EDI - Electronic Data Interchange
EFT - Electronic Fund Transfer
FTC - Federal Trade Commission
FY - Financial Year
GPRS - General Packet Radio Service
IBA - Indian Bank’s Association
IDRBT - Institute for Development and Research in Banking
Technology
IAMAI - Internet and Mobile Association of India
IMPS - Inter-bank Mobile Payment System
IP - Internet Protocol
KYC - Know Your Customer
MDR - Merchant Discount Rate
MICR - Magnetic Ink Character Recognition
MMID - Mobile Money Identifier
NECS - National Electronic Clearing Service
NEFT - National Electronic Fund Transfer
NFS - National Financial Switch
NPCI - National Payment Corporation of India
xix
NSDL - National Securities Depository Ltd
PDA - Personal Digital Assistant
PI - Participant Interface
PKI - Public Key Infrastructure
POS - Point Of Sales
RBI - Reserve Bank of India
RECS - Regional Electronic Clearing Service
RTGS - Real Time Gross Settlement
SBI - State Bank of India
SEFT - Special Electronic Fund Transfer
SFMS - Structured Financial Messaging Solutions
SPNS - Shared Payment System
STP - Straight Through Processing
TBA - Total Bank Automation
TRAI - Telecom Regulatory Authority of India
USSD - Unstructured Supplementary Service Data
VSAT - Very Small Aperture Terminal
WAP - Wireless Application Protocol
WI - Web Interface
xx
CHAPTERS
PARTICULARS
PAGE.
NO
Acknowledgement
iv
List of Tables
vi
List of Charts
xviii
List of Abbreviations
xix
I
Introduction
1
II
Electronic banking products and services
86
III
Socio – Economic profiles of E-Banking
customers
203
IV
Awareness and Utility of E-Banking services
240
V
Problems perceived by E-Banking customers
252
VI
Customers’ satisfaction towards E-banking products and services
389
VII
Summary of Findings, Suggestions and
Conclusion
412
Bibliography
xxi
Appendix
xxviii
xxi
CONTENTS
1
CHAPTER - I
INTRODUCTION
Banking is an indispensable constituent of the financial system and the
economy of a country. Its development is being reflected by the economic
development of the nation. It is like a backbone for the country, inevitable for
prosperity.
Indian banks are on sound footing. They have become strong, healthy,
dynamic and resilient a necessary condition for sustained economic growth and
financial stability. Banks in the country have provided stability in the wake of
international fiscal problems and meltdown was a credit to the functioning of the
banks here.
Indian banking is fairly mature in terms of services, product range and
reach. There has been a phenomenal expansion in the geographical coverage and
functional reach of the banking system in India. Indian banks have come out of
their traditional business of banking into various other fields of operation such as
merchant banking, venture capital, mutual funds, housing finance, factoring and
other financial services. They have transformed themselves and are offering
services through electronic delivery channels. From computerization to networking
and to e-banking, banks have moved up in the value chain. The adoption of
technology has heralded a transformational development in the banking sector.
2
1.1 HISTORY OF BANKING IN INDIA
In India, the business of banking and credit was in practice even in very
early times. The modern type of banking however was developed by the agency
house of Calcutta and Bombay after the establishment of rule by the East India
Company in 18th
and 19th
centuries. The General Bank of India was the first bank
in India established in 1786.
The beginning of Occidental banking started with the establishment of the
Bank of Hindustan in Bengal as a joint-stock bank under control of Britishers for
undertaking the banking operations for the benefit of their constituent which failed
in 1832 due to the failure of its parent firm.
The first bank of Indian origin was started in 1809, called Presidency Bank
of Bengal followed by the setting up of presidency Bank of Bombay in 1840 and
Presidency Bank of Madras in 1843. In between many banks had sprung up like
mushrooms and failed mostly due to speculation, mismanagement and failure of
their parent companies. Due to large scale failure of the banks, the development of
banking went on at a slower pace and only two important banks viz., Allahabad
bank ltd (1865) and The Punjab National Bank (1894) were established by the end
of the nineteenth century.
At the beginning of twentieth century under the influence of Swadeshi
movement, a number of joint stock banks were established by Indians, but the
outbreak of First World War disrupted this process. The conditions during world
War period (1914-1918) emphasized the need for a unified banking institution to
3
run the accounts of the Government efficiently, as a result of which Imperial Bank
of India was setup in 1921 by amalgamating all three presidency banks.1
Reserve Bank of India was established in 1935 with a view to manage the
currency and credit of the country by acting as a bank of the Government and the
commercial banks. India like other developing countries followed the path of
planned development after independence in 1947. In 1948 Banking Regulation Act
was passed which came into force in March 1949.2
It imposed certain discipline on the joint stock companies doing banking
business in India. During that period banks were largely urban oriented and
remained beyond the reach of the rural population. The RBI was nationalized in
the year 1948 and vested with the extensive power for the supervision and
regulation of banking in India as a Central Banking Authority.
With the introduction of economic planning in 1951, the need was felt for
aligning monetary and banking activity with the requirements of planning. On the
basis of recommendations of the All India Rural Credit Survey committee, the
Imperial Bank of India was nationalized and renamed as SBI from July 1955. The
main objective behind the establishment of SBI was to extend banking facilities on
a large scale more particularly in the rural & semi-urban areas.3
1en.wikipedia.org/wiki/banking_in_India.
2.http://banknetindia.com
3.Dr.T.K.Velayudham “Developments in Indian Banking; past present and Future”, The Journal of the Indian Institute
of Barkers, Bank Quest, 2002, Vol:73, No.4, pages.23-37
4
As part of the process of geographic expansion of banking facilities to meet
the credit needs of co-operatives, certain banking companies functioning in
formerly princely states were converted in 1959 in to subsidiaries of SBI later,
came to be known as associate banks of SBI.
In order to turnout the mere business of money lending in to the major force
controlling the economy of a nation, banks were nationalized which is considered
as a historic beginning to the vast development. It is an important mile stone in the
history of Indian banking. Banks were nationalized in two stages. On 19th
July
1969, 14 major commercial banks with deposit of over 50 crores were
nationalized. Again on 15th
April 1980, 6 more banks with deposits of not less than
200 crores were nationalized. As a result, 91 percent of the banking system in
India was brought under the public sector.4
The banks were nationalized only after the failure of social control
measures adopted by the Government in 1968. Until1969, the Indian banks did not
play a proper role in the planned development of the nation. They were
concentrated on individuals benefit than social benefits.
The nationalization of major commercial banks ushered in big changes in
the style, approach and functioning of banks. Since nationalization, the banking
industry has been progressing in a significant manner. There has been a six fold
increase in the number of bank offices. One of the significant results has been the
setting up of branches in rural and semi-urban area.
4.http://www.ftkm.com/banking
5
The mobilized resources have been properly utilized for rural & semi-urban
areas representing agriculture, small and tiny industrial units. The saving habit of
the public developed to commendable level. Common people got priority over the
elite. The emphasis moved from profit to service.
The euphoric experience of nationalization was so encouraging that the
Government of India based on the recommendations of Narasimham committee
decided to setup Regional Rural Bank in 1975 for developing rural economy by
meeting the credit needs of the weaker sections of the society. The RRBs were
established at selected regions where the co-operative system was weak and where
commercial banks were not very active.
During late eighties and early nineties of the twentieth century, social
considerations were dominant over commercial judgment, which led to
compromise on the quality of the credit leading to poor profitability of the banks
resulting in to booking of losses by the nationalized banks. Revamping the
structure of the banking industry was of extreme importance, as the health of the
financial sector in particular and the economy as a whole would be reflected by its
performance.
India embarked upon a massive programme of stabilization and structural
reforms in the midst of the unprecedented balance of payment and financial crisis
in mid – 1991. When the reform process started in the Indian economy following
the crisis, policy makers in India took a much more holistic view, and the reform
programme embraced various sectors of the macro economy.
6
The reforms have enhanced the opportunities and challenges for the real
sector making them operate in a borderless global market place. However to
harness the benefit of globalization, there should be an efficient financial sector to
support the structural reforms taking place in the real economy.
Hence Government of India and the RBI thought it was necessary to
introduce reforms in the financial sector also to promote rapid economic growth
and development with stability through the process of globalization, liberalization,
and privatization in the financial system, so that the financial system becomes
more competitive and gets integrated with the world economy through
internationalization of financial markets in the world.
Accordingly, the process of financial sector reforms initiated based on the
recommendations of Narasimham committee in 1992. This committee report made
radical recommendations for the banking sector by emphasizing the need for
deregulation and liberalization. According to this report, banks are permitted to
raise capital from the public, New Private sector banks were allowed to operate,
nationalization of banks were stopped, and no distinction was made between
private and public sector banks. More importantly to complete the global economic
integration process, foreign banks were allowed to operate in India.
The Narasimham committee suggested that there should be functional
autonomy, flexibility in operations, dilution of banking strangulations, reduction in
reserve requirements and adequate financial infrastructure in terms of supervision,
audit and technology. The committee further advocated introduction of prudential
7
norms, transparency in operations and improvement in productivity, not only
aimed at liberalizing the regulatory frame work but also to keep them in time with
international standards. The emphasis shifted to efficient and prudential banking
linked to better customer care and customer service.5
Banking scenario since 1991 has been a process of transformation and
consolidation. There has been paradigm shift in operational, functional,
environmental and technological spheres. Almost all insulation to commercial
banking has been peeled off and it has been susceptible to all types of exposures
now.
As part of reform, Indian banking was opened for private sector by which
old and new private sector banks came to limelight. They gave a big boost to
technology and created a platform to use it for backside and front side operations.
When they started adopting it this put a tremendous pressure on the nationalized
and public sector banks. With the result of such healthy competitive environment,
overall banking system became more work prone, efficient, and technology savvy.
With the development of telecom sector, communication infrastructure,
BPOs, the entire country became a single hub of transmitting the information
which helped in the reduction of total cost. This had directly helped banks. During
the same period, banks were busy in connecting their branches with centralized
data base and core banking solution for offering anywhere, anytime services.
5Rakesh Mohan “ Financial Sector Reforms in India”, Economic & Political Weekly, Vol-XL No.12, March 19, 2005.
8
RBI made several changes in the basic structure of banking sector and laid
down numerous guidelines on electronic banking, fund transfer, core banking
solutions, payment system, clearing services and internet banking. With the
advancement and adoption of technology a lot of changes have been made in
payment system and banking system as a whole. Now banks can reach their
customers anywhere, anytime and customers are able to get instant access to their
accounts from any corner of the globe anytime.
1.2 ELECTRONIC BANKING
Financial sector is metamorphosing in the impact of competitive regulatory
and technological forces. Technology is emerging as a key driver of business in the
financial service industry. The transition of business operations by banks using
electronic forces created new modes of operations called e-banking.
E-banking is defined as an automated delivery of new and traditional
products and services directly to customers through electronic, interactive
communication channels. E-banking includes the systems that enable 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.
9
According to a survey of electronic cash and electronic banking report by
FINCEN “electronic banking is an umbrella term for the process by which a
customer may perform banking transactions electronically without visiting a brick
and mortar institution.”6.
E-banking is a generic term encompassing internet banking, telephone
banking and mobile banking. In other words, it is a process of delivery of banking
services and products through electronic channels such as telephone, internet and
cell phone.
Electronic banking allows banks to expand their market for traditional
deposit – taking and credit extension activities and to offer new products and
services or strengthen their competitive position in the market. It has given an
opportunity for banks to find solutions to manage problems like saving time,
money and energy of customers by reducing or minimizing, paper works, waiting
in queues, lack of communication and lack of efficiency. E-banking has provided
ease and flexibility in banking operations.
The major driving force behind the rapid speed of E-banking is its
acceptance as an extremely cost effective delivery channel. But it is associated
with risks such as reputational risk, security risk, cross-border risk and strategic
risk, which are unique to e-banking.
6.www.bankersonline.com
10
1.3 CONCEPT OF E-BANKING
The concept and scope of e-banking is still evolving. Electronic banking is
the new trend significantly adopted by banking sector worldwide due to its wider
scope for the customers as well as banks at large. E-banking facilitates an effective
payment and accounting system thereby enhancing the speed of delivery of
banking services considerably. While e-banking has improved efficiency and
convenience, it has also posed several challenges to the regulators and supervisors.
Several initiatives taken by the Government of India as well as Reserve Bank of
India have facilitated the development of E-banking in India.7 Daniel (1999)
defines electronic banking as the delivery of bank’s information and services by
banks to customers via different delivery platforms that can be used with different
terminal devices such as a personal computers and a mobile phone with browser or
desktop software, telephone or digital television8.
According to Karjaluoto (2002) Electronic Banking is a construct that
consists of several distribution channels. It should be noted that e-banking is a
larger concept than banking via Internet.9 E-banking is a brew of services that
embody internet banking, Mobile banking, ATM Kiosks, Fund Transfer system,
Real Time Gross Settlement (payment and allotment system), credit/debit/smart/
7 www.rbi.org.in
8Daniel, E(1999), “Provision of electronic banking in the UK and the Republic of Ireland”, International Journal of
Bank Marketing, Vol, 17,No.2, Pages.72-82.
9Karjaluoto, H, (2002), “Electronic banking in Finland; Commercial belief, Attitude, Intentions and Behaviours,
Doctoral Dissertation, University of Jyvaskyla, Jyuvaskyla.
11
kisan cards, cash government services, as well as data warehousing, operational
interpretation for MIS as well as customer relationship management (E tools 4
all).10
Electronic distribution channels provide alternatives for faster delivery of
banking services to a wider range of customers (Kaleem and Ahmad, 2008).11
The
definition of e-banking varies amongst researchers partially because e-banking
refers to several types of services through which a bank’s customers can request
information and carryout most retail banking services via computer, television or
mobile phone (Mols, 1998, Sathye 1999).12
A perusal of the concept of e-banking as described in the literature reveals
that the term e-banking is an upper construct that encompasses an array of banking
services delivered through electronic media, be it through phone, PC, or internet.
Thus the term e-banking includes ATM, Credit Card, Debit Card, Internet banking,
Mobile banking, RTGS, NEFT & ECS.
10E tools 4911, E-banking? Recent trends in India, http://etools4all.org/e-banking-reunttrends.in.india. html accessed on
16 August 2013.
11 Kaleem A and Ahmad.S. (2008) “Bankers perceptions of electronic banking in Pakistan”, Journal of Internet banking
and Commerce, Vol.13, No.1, pages.23-36.
12Mols.S.N. (1998), “Behavioral consequence of PC banking’ International, Journal of Bank Marketing, Vol.16, No.5,
pages.195-201.
12
1.4 ADOPTION OF TECHNOLOGY AND EVOLUTION OF E-BANKING
IN INDIA
Technology adoption has changed the face of banking in India. What started
as a mere automation of some routine work process in banks in the mid-80s has
moved on to become business process re-engineering which has resulted in making
banking services branchless, anytime and anywhere, facilitated new product
development and enabled near real time service delivery. It has helped banks to
reach the door steps of the customer by overcoming the limitations on
geographical/physical reach in branch banking and easing the resource and volume
constraints posed by the brick and mortar model.
The introduction of mechanization and particularly computerization has laid
foundation, for the evolution of e-banking. The use of computers has led to the
introduction of online banking. In 1967-71 about 100 computers were installed in
different enterprises. But only two of them were located in banking industry. The
first bipartite settlement on mechanization and computerization was made in 1966
between Indian Bank’s Association and the All India Bank Employees Association
which accounted for the use of IBM and ICT accounting machine for inter branch
reconciliation etc.13
13http://www.preservearticles.com
13
The first serious effort and blue print, for computerization in banking
industry was drawn up in 1983 under the aegis of Dr.C.Rangarajan committee. The
committee recommended that computerization and installation of Advanced
Ledger Posting Machine (ALPM) at branch, regional and head offices of the bank
will bring around new era in bank. In 1986 the RBI decided to use MICR
technology in cheque collection and clearance which is the basic function of the
banking industry.
The second committee constituted in 1988 drew up a detailed perspective
plan for computerization in banks and for extension of automation to other areas
like fund transfer. The branch automation enabled setting up of single window
service facilities which were focused on customers. Then banks started exploring
the idea of total Banks Automation. Although titled Total Bank Automation, TBA
was in most cases confined to branch automation. It was only in early 1990s that
banks started thinking about tying up disparate branches together to facilitate
information sharing. Saraf committee was constituted by RBI in 1994 that
recommended the use of electronic fund Transfer System (EFT), introduction of
electronic clearing service and extension of magnetic ink character recognition
(MICR) beyond metropolitan cities and branches14
. Meanwhile the networking of
the already computerized branches also assumed urgency and some of the banks
have started inter connecting their computerized branches using leased telephone
lines or very small Aperture terminal (VSATs).
14http://www.rbi.org.in/scripts/publications.
14
This is meant to provide more comprehensive service to customers and at
the same time give banks better centralized control over the branch operations.
An important stage in the evolution of the user friendly technology or e-
banking arrived with the deployment of ATMs. This was the first stage of
empowerment of the customer for his own transactions. The liberalization in 1991
marked the entry of foreign and new private sector banks. They brought new
technology with them and banking products became more and more competitive.
Hence, a need for differentiation of products and services was felt. The ICICI bank
had started online banking in 1997 under the brand name infinity.
The development and use of communication network have also helped the
banking industry to improve the quality of its services. Beginning modestly with
leased terrestrial technology i.e. BANK NET and its communication software the
RBINET, a milestone was passed in February 1997 with the operationalization of
the Shared Payment Network System (SPNS) of ATMs of the Indian Bank
Association in Mumbai.
With the setting up of IDRBI, three most important technology
infrastructures were created and these were INFINIT in 1999, the implementation
of public key infrastructure (PKI) based data transfer and structured Financial
Messaging System (SFMS) which facilitated the development of secured payment
system practice in India. INFINIT is the back bone for a safe, reliable and effective
communication network and messaging system. It has now incorporated low cost
15
yet reliable technologies in the form of Multi-pocket – label switch (MPLS)
technology in an effort to offer state – of – the art – network.15
A slew of innovations in newer delivery channels like internet banking,
mobile banking and prepaid cards issued by non-banking entities emerged. The
rapid shift towards electronic transactions in the form of automated teller
machine, debit cards, internet, banking etc. has made real time core banking
system a requirement to support for the up to the minute balance reporting
requirement, that the older system cannot support. According to RBI report, the
percentage of branches under core banking solutions increased by 79.4 percent as
at end March 2009 to 90 percent at the end of March 2010.16
Among the path breaking initiatives in the area of payment and settlement
systems of the country, electrification of payment system has become the hall
mark of the decade that has gone by. Electronic based payments are superior to
paper based system in terms of traceability, efficiency speed and safety. The
introduction of RTGS in 2004 has resulted in not only compliance with
international standards but also paved the way for risk free fund transfers settled
on a real time basis. The facility for inter-bank fund settlement through RTGS is
available across more than 88,000 branches of banks spanning more than 5000
centres of the country, a coverage that has perhaps, not witnessed anywhere else in
the world.17
15www.idrbt.ac.in
16RBI report on trend and progress of banking in India 2009-10, Page.55 http://rbi.org.in/scripts/publications.
17http://en.wikipedia.org.wiki.real-Time-Gross-settlement.
16
The facility for inter-bank fund settlement through RTGS is available across
more than 88,000 branches of banks spanning more than 5000 centres of the
country, a coverage that has perhaps, not witnessed anywhere else in the world.17
Thus, the introduction of various electronic delivery channels has had a
beneficial impact on both banks and customers. For banks, electronic channels
have emerged as a strategic resource for achieving higher efficiency, control of
operation, productivity and profitability. For customers, it is the realization of their
anywhere anytime and any way banking dream.
1.5 IMPACT OF E-BANKING
Electronic banking has turned the world of personal finance upside down by
completely changing what consumers expect from a bank. Whereas, formerly
banks would distinguish themselves through the quality of their direct interaction
with consumers. Today, providing them with a convenient, safe and fail – proof
banking interface has instead turned in to the main focus.
The impact of e-banking is not limited to industrial and the most advanced
economies. Even for countries with underdeveloped banking system, E-banking
offers an opportunity to leapfrog. Because e-banking is much cheaper since its
lower processing cost for providers and search and switching costs for consumers.
Providers can market banking services involving smaller transactions to
lower income borrowers even in remote areas. According to industry experts, a
bank spends an average of Rs.40 for each transaction conducted at a branch. If a
customer uses the ATM facility, the cost drops to Rs.18 – 20 per transaction, but it
17
is still much higher than the cost involved in online banking. For net banking, the
cost is Rs.4 for transaction. As per the reason survey by IBM Global Services
Consulting Groups, Traditional Banks spend 60 percent of the revenue generated
to run a branch, whereas the cost of providing the same services via, internet
comes out to be only 15 percent. Thus there is a huge savings for banks and
consumers.18
The advent and proliferation of e-banking enable broader and inclusive e-
banking sector and in the process is a key driver for sustained and inclusive growth
of the economy. Branch customers are now bank customers as they can access
their account from anywhere. It has become well recognized that the use of e-
banking helps in increasing the transparency of the banking system. This has
become essentially important due to the latest international initiatives in relation to
anti-money laundering. The movement from paper based payment to electronic
means of payment that the funds being transferred are easily track able. This also
adds to the accountability of funds in an economy.
In a developing economy like India, e-banking has helped in modernizing
the financial systems, creating economic transparency and contributing to greater
predictability, liquidity and stability. One of main advantage and main reason for
migration to electronic banking from paper based banking is that of the improved
operational efficiency brought about by its use. Reduction in transaction time and
18http://articles.economictimes.indiatimes
18
transaction cost has helped companies and government and other end users of e-
banking products to improve their operational efficiency.
1.6 ISSUES AND CHALLENGES OF E-BANKING
Electronic channels have brought fundamental shift in the functioning
banks. It is not only helping them bring improvements in their internal functioning
but also enable them to provide better customer service. It provides the opportunity
of breaking all boundaries and encouraging cross border banking business.
There are several benefits associated with the introduction of e-banking.
Benefits may vary depending upon various perspectives. From the banks
perspective provision of e-banking delivery channel to consumers would enhance
the opportunity to maximize their profit. The chief goal of many businesses in
monetary terms is associated with profit maximization (Nathan 1999). Moreover,
from the banker’s point of view, proliferation of the e-banking is an essential
requisite not only in terms of cost saving by reducing the human interaction,
improving competitiveness by way of differentiation and retaining existing
customer base as well as attractive potential consumers.
Banks throughout the world, face an increasingly tough challenge of
boosting their revenues while controlling their cost (Durkin 2004).Therefore the
common trend followed by many banks globally is stream lining their branch
networks and redirecting their consumers to alternative service delivery channels
19
and encouraging consumers to adopt self- service technologies.19
Thus banks are
reducing the cost incurred in maintaining the branch staff (pyumetal 2002). Also,
banks often build better brand image by way of responding to the rapid market
changes and would therefore be perceived as leaders in adoption of innovative
technologies.
From consumers point of view automation of banking services by
introducing electronic delivery channels provides 24 hours accessibility, reduces
costs in accessing and using of banking products and services, proper cash
management, reduced time demands, increased comfort as well as quick and
continuous access to the information (Aladwani, 2001).
Existing studies report that consumers by way of utilizing electronic
channels can manage funds in a better manner. Majority of the consumers are
happy with the speed and convenience associated with the e-banking (Gurau,
2001).
Besides the various opportunities, there are certain concerns and challenges
exerted by the banks and well as consumers with regard to the uptake and use of e-
banking. Banks initially promoted their core capabilities through the internet. Due
to the relative newness of the technology associated with e-banking banks as well
as consumers often concerned about the security of internet access to client
account (stamoulis, 2000).20
19Sujance Adapa, “Global E-banking Trends: Evolution, Challenges and opportunities”, University of New
England Australia.
20Stamoulis. DS (2000) “How Banks Fit in an Internet Commerce Business Activities Model”, Journal of Internet
Banking and Commerce, June 5 available online at http://www.arraydev.com/commerce/J1BC/articles
20
Several studies indicated that the acceptance of e-banking by consumers’ is
affected by perceived security (Dourish&Redmiles, 2001).21
Several banks in
order to maintain their competitive advantages mimic new channel approaches
quickly, as product differentiation is very difficult for banks (Nemzow, 1999).22
Moreover, the threat of substitutes to banking in terms of competition from
non-banking, financial and micro credit sectors is increasing rapidly (Mia etal.,
2007). The competition is fierce in the banking and financial sector environment as
every entrant is participating to some extent of e-banking which raises the issues of
security, privacy and risk (Constantine 2000).23
In e-banking system, information is considered as an asset and so worthy of
protection. According to online Banking Association, member institutions rated
security as the most important issue of online banking. There is a dual requirement
to protect customers’ privacy and protection against fraud. As most banks urge
customers to shift to the virtual space, their ability to create fortresses against
cyber aggression has come in to the spotlight.24
From just a few stray cases of identity theft a few years ago, internet frauds
have not only risen in scale but also gone high-tech, so much so that it has become
difficult to identify the origin of crime and nail the culprits. Cyber heist is an issue
21Dourish. Pand D.Redmiles (2002), “An approach to usable security based on event monitoring and visualization”, in
proceedings of the 2002 workshop on New Security paradigms (New York, ACM press)pages. 5-81.
22Nemzaw.M (1999), “E-commerce stickiness for customer retention”, Journal or internet banking and commerce,
October 4 (1).
23ConstantineG (2000) “Banks Provide Internet on-ramp” Hoosier Banker, Indianapolis, March, USA.
24www.banknetindia.com
21
that not just Indian banks are faced with. Cyber-attacks ranked fourth among top
global risks, in terms of likelihood, according to the World Economic Forum
Report ‘Global Risks 2012’. Two Indian payment processors Electric Card, and
Enstage, were in the spot light recently for their alleged role in a $45 million credit
card fraud impacting Indian and International cards. The total amount involved in
frauds relating to credit card, debit card, internet banking rise 74 percent to Rs.38.4
crores in 2012.25
Experts suggest that simple rules such as not sharing login ID and
passwords with anyone, would keep customers safe.
1.7 GROWTH AND DEVELOPMENT OF E-BANKING
E-banking is one of the emerging trends in the Indian banking and is
playing a unique role in strengthening the banking sector and improving service
quality. It has enabled the banks to handle the payments electronically, inter- bank
settlement faster and in large volumes. Availability of ATMs, plastic cards, EFT,
electronic clearing services, internet banking and mobile banking to a large extent
avoid customers going to branch premises and has provided wider range of
services to customers. According to the ICICI bank statement more and more
people are shifting to alternative delivery channels, which accounted for nearly 30-
40 percent of customers at present. Over the next few years this is likely to go up
to 70-80 percent.26
25www.weforum.org/report/global-risks-2012-seventh edition.
26businesstoday.intoday.in/story/India.
22
ATM is the oldest of the alternative banking channels and enjoys the
highest level of acceptance among customers. The number of ATMs in India has
doubled in the past three years. By 2013, there are more than 1,00,000 ATMs
around 70 percent of them in urban locations. Global research firm Celent expects
that the number of ATMs to double by 2016, with more than 50 percent being set
up in small towns.
Banking has also been seeing a change due to the efforts of the RBI to
include a habit of paperless payments such as credit card, debit cards, electronic
transfer and mobile banking. During 2011-12, the volume of online fund transfer
through NEFT and RTGS grew by 71 percent and 11.7 percent respectively,
according to RBI report27
. According to a report by IAMAI, penetration of
cashless transaction stands at measly 0.43 percent. It has been said that only about
3.6 percent of households in India make cash less transactions. About 11 percent
households in urban area undertake cashless transactions while, in rural India only
0.43 percent of the households make cashless transaction.28
.
Today, consumer’s usage of internet banking is growing at a rapid pace
across geographies. Internet banking usage in India increased to seven percent
from one percent five years ago. The use of internet for banking has seen a
massive rise in the 2010-11, taking the overall number of bank consumers who use
the net to close seven percent of total bank account holders.29
It is a seven-fold
27www.rbi.org.in/database
28www.iamai.in/Press lease-details 29 www.infosys.com/industries/white paper.
23
jump since 2007, even as for the first time in the past 13 years. Branch banking has
come down by a full 15 percentage point during the same period. As of 2013, India
has the third largest number of Internet users. It is next to United States and China.
India is expected to have in excess of 125 million users by 2013 end.30
Mobile phones are seen as an enabler of electronic payments as the costs
are low. Mobile transactions have increased in the past few years, but the use of
mobile banking services is quite low. Most of the transactions carried out using
mobile phones are non-financial in nature. Notwithstanding this the growth in
mobile transactions has shown increasing trend. For example, in the month of June
2012, 3.43 million transactions amounting to Rs.3067.10 million were processed
as compared to 1.41 million transactions amounting toRs.984.66 million processed
in June 2011 an increase of about 143 percent in volume and approximately 211
percent in value terms.31
Modern electronic payment systems are still concentrated in metros and
large towns. A large chunk of the Indian population still does not have access to
formal banking channels. According to RBI, there were around 147,000 bank
outlets for more than 6,00,000 villages in India. Some banks though are using the
business correspondent model to expand their reach and bring more people under
formal banking using technologies such as hand held devices and micro ATMs32
.
30www.thehindu.com
31R.Srividya “India awaits boom in mobile banking, www.mydigitalfc.com/banking/India.
32 articles.economictimes.indiatimes.com
24
With mobility and customer convenience seen as keys to growth, banks are busy in
exploring new technologies. Experiments with near field communication
technology have failed to provide mass-scale payment solution, but the industry is
buzzing with terms cloud computing and mobile solutions.
1.8 REVIEW OF LITERATURE
A review has been primarily to identify appropriate methodology. It is a
subject of the articles/reports which has been received. A few available literatures
on e-banking products such as internet banking Mobile banking, ATMs debit cards
and credit cards in India and internationally reflect the current status of E-banking.
There are numerous research and papers that study the evolution and growth of
electronic banking in India and outside India. A review of some of them is given
below, the description has been organized under the heads: E-banking, Mobile
banking, Electronic payment and E-cheque, ATM and Credit Card, Technology
and Customer Service.
E-BANKING
The Research paper, “ Internet banking in India- consumer concern and bank
strategies” of P.K.Gupta and Jamai Millai Islamia33
presents the data drawn from a
survey of internet banking consumers and service providers (banks) that offer
internet banking and also on the products and services they offer. This research has
developed a functional model for maximizing value to the consumers, which the
33P.K.Gupta and Jamia Millia Islamia, ‘ Internet banking in India- Consumer concerns and Bank strategies.” Global
conference of business and finance proceedings, Vol.2, No.2, 2007
25
banks may choose to adopt internet banking strategically. An attempt has been
made to identify the weakness in the present conventional banking and to explore
the consumer awareness, use patterns, satisfaction and preferences for internet
banking vis-a-vis conventional form of banking. The factors that may affect the
strategy of the bank to adopt internet banking have been characterized. The paper
also addresses the regulatory and supervisory concerns of internet banking.
Richard Nayangosi, J.S.Arora and Sumanjeet34
Singh have conducted a
research on e-banking. The title of their research paper is “The evolution of e-
banking: a study of India and Kenyan technology awareness”. In this study they
collected customers’ opinions regarding the importance of e-banking and the
adoption level of various e-banking technologies in India and Kenya. This study
collected the trends of e-banking indicators in India and Kenya. Further the
researchers segregated the data collected in to an Indian and a Kenyan customer
basis to identify differences in their attitudes towards the emergence of e-banking.
The overall result of this study indicates that customers in both countries have
developed positive attitudes and they give much importance to the emergence of e-
banking.
34Richard Nayangosi, J.S.Arora and Sumanjeet “The evolution of e-banking: a study of India and Kenyan technology
awareness”, International Journal of El; electronic finance 2009, volume.3 No.2pages.149-165.
26
An article has been published by R.K.Mishra and J.Kiranmani35
on the topic
“E. banking: A case of India” This article presents an overview of e-banking, its
evolution and comparison of the internet banking facilities in Indian banks. The
case study approach has been used to compare various banks rendering different
internet banking services to its customers. It also explains that the shift towards the
involvement of the customers in the financial service with the help of technology,
especially internet, has helped in reducing cost of financial institutions as well as
clients/ customers who use the service at any time and from virtually anywhere
with access to an internet connection.
Pooja Malhotra and Balwinder singh36
have undertaken a research on
“Determinants of internet banking adoption by banks in India”. In this exploratory
study they have attempted to discover the factors affecting a bank’s decision to
adopt internet banking in India. The data for this study consists of panel data of 88
banks in India covering financial year 1997-98 to 2004-05.
The results show that the larger banks, banks with younger age, private
ownership, higher expenses for fixed assets, higher deposits and lower branch
intensity evidence a higher probability of adoption of this new technology. Banks
with lower market share also see the internet banking technology as a means to
increase the market share by attracting more and more customers through this new
channel of delivery. Further, adoption of internet banking by other banks es
35R.K.Mishra and J.Kiranmani, “ e-banking: a case of India”. The ICFAI University Journal of Public administration,
Vol. Year 2009 Issue month, January Pages 55-65
36Pooja Malhotra and Balwinder Singh, “ Determinants of Internet banking adoption by banks in India.” Journal of
Internet Research, Vol.17, Issue.3, 2007, Pages 323-339, emerald group publishing ltd.
27
of delivery. Further, adoption of internet banking by other banks increases the
probability that a decision to adopt will be made.
The Research paper “Technologies for ecommerce:: India Initiatives” of
Saxena. A and Dani.A.R37
, discusses various payment instruments and present one
of them namely e-cheque protocol and development activities along with its usage
and advantages over other. It also discusses about the integrated product suite for
conducting end-to-end commerce transaction using credit card and e-cheque with
PK1 technology for payment purpose, and to address the perimeter security
firewall and intruder detection system which was developed by the research
activities of IDRBT.
N.Krishna Veni38
in her article “Introduction to e-commerce, e-business and
e-banking” explains the meaning of e-banking, different forms of e-banking, its
common and support services, components and risk issues related to certain e-
banking services. This article gives various valid suggestions for bankers. It is
stated that the banks should have a clear and widely disseminated strategy that is
driven from the top and should take into account the effects of e-banking, together
with an effective process for measuring performance against it. It should take into
account the effect that e-provision will have upon their business risk exposure and
manage these accordingly.
37Saxena A.andDani.A.R. “Technologies for E-commerce: India Initiatives”, TENCON2003, conference on convergent
Technologies for Asia-pacific Region, vol.4, Oct 2003, pages 1434-1438.
38N.Krishnaveni, “Introduction to E-Commerce, E-business and E-banking http:/www.Indian,mba.com, March 2007.
28
A research paper has been published by Sarkar Partha De, Yadav
Surendra.S.Banwet D.K.39
on the topic “Emergence of flexible distribution
channels for financial products: Electronic banking a competitive strategy for
banks in India”. In this paper, the four major categories of players, in the Indian
banking sector, i.e, public sector banks, private sector banks, financial institutions
like ICICI and IDBI and foreign banks have been studied to identify competitive
strategies followed by each to get in to the non-branch delivery business.
Developmental banks, rural banks, co-operative banks have been left out of the
scope of this study, since this is not their area of focus. In this paper, it is
emphasized that all players in this market should gear up their supply chain
management processes for better customer acquisition and retention.
N.Kamakodi and Basheer Ahmed Khan40
have conducted a research on “e-
banking channel acceptance by Indian Customers”. In this research, survey result
has been obtained from 292 respondents about their view on electronic banking
channels. The result has indicated that the majority of the customers are very
comfortable and willing to use e-banking channels. At the same time, over 80%
feel that human contact is necessary. It has also revealed that the technology alone
can’t give a sustainable competitive advantage for the banks. When all banks
39Sarkar Partha De, Yadav Surender.S. and Banwet .D.K “Emergence of flexible distribution channels for financial
products: Electronic banking as competitive strategy for banks in India,’ Global Journal of flexible systems
management, vol.2 issue 3, 2001.
40N.Kamakodi and Basheer Ahmed Khan, “Looking beyond technology: A study of e-banking channel acceptance by
Indian Customers”, International Journal of Electronic Banking, Vol.1, No.1, 2008, pages 73-94.
29
introduce IT in their technology, IT would lose its position as a differentiator. The
conclusion derived from the research is that, beyond point IT along with ‘personal
touch’ will be necessary for the banks to retain the existing clients and attract new
clients.
The research article “Deploying Internet banking and e-commerce-case
study of a private sector bank in India” of G.Kannabiran and P.C. Narayan41
discusses the experience of a private sector bank in deploying internet banking and
e-commerce in India. Strategic alignment of business and IT strategies, planning
and implementation of e-banking initiatives and management of benefits are
captured along with key contributions to development.
Avinandan Mukherjee and Prithviraj Nath42
in their study on “A model of
trust in online relationship banking” tested five hypotheses with a sample of 510
internet users of various profiles in India. It is observed from the study that shared
value is most critical to develop trust as well as relationship commitment.
Communication has a moderate influence on trust. While opportunistic behaviour
has significant negative effect. It is found that higher perceived trust would
significantly enhance customer’s commitment in online banking transaction. It is
added that future commitment of the customer to online banking depends on
perceived trust.
41G.Kannabiran and P.C.Narayan, “ Deploying Internet banking and E-commerce- case study of a Private Sector Bank
in India”, Journal : Information Technology for Development, Vol.11, Issue 4, Sept 2005, pages: 363-379, published on
line on 23rd Sept 2005.
42Avinandan Mukherjee and Prithwiraj Natha, “ A model of Trust in online relationship banking, “ International journal
of bank marketing Vol.21 issue.1, 2003, pages 5-15
30
Serkan Akinci, Safak Aksey and Eda Atilgan43
conducted a research on the
topic” Adoption of internet banking among sophisticated consumer segments in an
advanced developing country”. This descriptive study was conducted to develop
an understanding of consumers’ attitudes and adoption of internet banking among
sophisticated consumers. Based on a random sample of academicians,
demographic, attitudinal, and behavioural characteristics of internet banking users
and non-users were examined. The analyses revealed significant differences
between the demographic profiles and attitudes of users and non-users. IB users
were further investigated and there-sub-segment were defined according to a set of
bank selection criteria. Finally, based on the similarities between various web-
based bank services, four homogeneous categories of services were defined.
Sylvie Laforet and Xiaoyan Li44
in their study on “Consumers attitude
towards online and mobile banking in China” investigated the market status for
online/mobile banking in china. The demographic, attitudinal and behavioural
characteristics of online and mobile banking users were examined. Respondents
from six major Chinese cities participated in the consumer survey. The results
showed that Chinese online and mobile bank users were predominantly males, not
necessarily young and highly educated, in contrast with electronic bank users in
west. The issue of security was found to be the most important factor that
motivated Chinese consumer adoption of online banking. Main Barriers to online
43Serkan Akinci, Safak Aksoy, and Eda Atilgan, “ Adoption of Internet banking among Sophisticated consumer
segments in an advance developing country,” international journal of Bank marketing, vol.22, issue –3, 2004, pages
212-232.
44Sylive Laforet and Xiaoyon Li, “consumers’ attitude towards online and mobile banking in China”. International
journal of bank marketing, 2005, Vol.23, issue.5 pages 362-380.
31
banking were the perception of risks, computer and technological skills and
Chinese traditional cash-carrying banking culture. The barriers to mobile banking
adoption were lack of awareness and understanding of the benefits provided by
mobile banking. Distinct differences and common trends between Chinese and
other countries were observed with clear indication of marketing strategy to be
deployed by the service providers.
Petrus Guriting and Nelson oly Ndubis45
, in their research work on “Borneo
online banking: evaluating customer perceptions and behavioural intention”
examined the factors that determined intention to use online banking in Malaysia
Borneo. The results indicated that perceived usefulness and perceived ease of use
were strong determinants of behavioural intention to adopt online banking. There
was also an indirect effect of computer self-efficacy and prior general computing
experience on behavioural intention through perceived usefulness and perceived
ease of use.
Shumaila Y.Yousaf zai, John G.Pallister and Gordon R.Foxal46
in their
study on “strategies for building and communicating trust in electronic banking”
have examined the effectiveness of potential trust-building strategies for e-banking
and their impact on on-line customer perceptions of trust worthiness of the bank,
by specially focusing on the information clues presented on the banks website.
45Petrus Guriting and Nelson only Ndubisi, “ Borneo online banking: evaluating customer perceptions and
Behavioural intention”. Management Research News, 2006, Vol.29, issue1/2, pages 6-15
46Shumaila Y.Yousafzai, John.G.Pallister, and Gordon.R.Foxall, Cardiff University strategies for building and
communicating trust in electronic banking: A field experiment’, journal: information technology for development,
2005, wiley periodicals inc.
32
Structural assurance and situational normality mechanism both had an impact on
customers’ trustworthiness perceptions, suggesting that banks need to use a
portfolio of strategies to build the customer’s trust. The results further suggest that
the communication of meaningful and timely information has the potential to
influence customer’s trusting intentions.
A study has been undertaken by Hsin-Ginn Hwang, Rai-Fuchen and Jai-min
Lee47
on “measuring customer satisfaction with internet banking”. A web survey
was used with the subject being internet banking user of Taiwanese banks. A total
of 226 valid questionnaires were obtained with an 85% response rate. For the
development of a standardized instrument, an exploratory factor analysis was used.
The study demonstrates that all the items in the Doll and Torkzadich instrument
for end-user computing satisfaction measures are still valid in the context of
internet banking, and that IBCS (Internet banking customer satisfaction) depends
heavily on security and trust considerations on the internet.
Internet banking adoption among mature customers: early majority or
laggards?” is the title of the research paper published by Minna Mattila, Heikki
Karjaluoto, and Taipo Pento48
.Using the data of a large survey, they analyzed
mature customers’ Internet banking behaviour. House hold income and education
were found to have a significant effect on the adoption of the internet as a banking
47Hsin-Ginn Hwang, Rai-Fu Chan, and Jai-Min Lee, “Measuring customer satisfaction with internet banking: an
exploratory study.” International Journal of electronic Finance, 2007, vol.1 No.3 Pages 321-335
48
Minna Mattila, Heikki Karjaluoto and Taipo Pento, “Internet banking adoption among mature customers: early
majority or laggards?”, journal of service marketing, 2003, vol.17 issue.5, pages 514-528.
33
channel, so that over 30 percent of wealthy and well-educated mature males make
e-banking their primary mode of making payments. Perceived difficulty in using
computers combined with the lack of personal service in e-banking was found to
be the main barriers of internet banking adoption among mature customers.
Internet banking was also found to be more unsecure among mature customers
then bank customers in general.
Jason Dong and Michael Bliemel49
in their study on “Strategies for
increased integration of online and in-branch services of banks in Canada” have
examined the benefits of online banking and how Canadian banks accommodate
various financial activities through different service channels, including online,
telephone and in-branch. A frame work has been introduced for categorizing the
most common activities by their need for physical interaction and assistance and to
align activities with their ideal service channel. This research has been concluded
with the presentation of strategies for integrating these different customer
channels.
“E-banking and customer preferences in Malaysia: an empirical
investigation” by M.Sadiq Sohail, Balachandran, and Shanmugam50
. This
empirical research has been carried out in Malaysia to study the customers’
preference for electronic banking and the factors, which they have considered
49Jason Dong and Michael Bliemel, “ Strategies for increased integration of online and in-branch service of banks in
China’ “ Journal of internet banking and commerce, Dec 2008, vol.13, No.3
50M.Sadiq Sohail, Balachandran, and Shanmugam, “e-banking and customer preference in Malaysia: an empirical
investigation”, international Journal of information science- informatics and computer science, April 2003, vol.15, issue
3-4, pages 207-217
34
influenced the adoption of electronic banking. Results based on the analysis of
data relating to 300 respondents have indicated that while there is no significant
differences between the age and educational qualifications of the electronic and
conventional banking users, some differences exists on other demographic
variables. Analysis has further revealed that accessibility of internet, awareness of
e-banking, and customers’ reluctance to change are the factors that has
significantly affected the usage of e-banking in Malaysia.
The study of Kamini singh51
on “Effect of card and internet banking on
users” analysed the use pattern of the various banking services. The use pattern is
in terms of usage rate and usage period of banking services. The impact of various
features of card banking and internet banking through factor analysis has been
analyased. This study also analysed the satisfaction level of the account holder
while using the banking services on the basis of goodness. The study has revealed
the difference between the private and public banks.
The study of Marvin E.Gonzalez, Gioconda Quesada, Federico Picado, and
carl A.Eckelman52
on “customer satisfaction using QFD: an e-banking case” has
considered both external and internal service management issues and subsequent
service innovations based on the framework of quality function deployment
(QFD). The application of the customer window quadrant and the action plan
51Kamini singh “Effect of card and internet banking on users”, International Journal of Technology Marketing 2012,
Vol.7,No.1, pages20-31.
52Marvin.E.Gonzalez, Gioconda Quesada, Federico, Picadio and Carl A.Eckelman, “ Customer Satisfaction using QFD:
an e-banking case”, Journal: Managing service quality, 2004, vol.14, issue 4, pages 317-330, Emerald Group publishing
ltd.
35
matrix in the analysis of customer and service elements has constituted a different
approach for QFD. Some benefits and disadvantages of QFD process are discussed
as compared to extant service quality and customer paradigms. Finally,
suggestions and directions are offered for future applications, with particular
interest in the e-banking service management issues.
Terpo Pikkarainen, Kari Pikkarainen, Heikki Karjaluoto, and seppo
Pahnila53
in their study on “consumer acceptance of online banking: an extension
of technology acceptance model” have investigated online banking acceptance in
the light of the traditional technology acceptance model (TAM) which has been
leveraged in to the online environment. On the basis of a focus group interview
with banking professional, TAM literature and e-banking studies, they have
developed a model indicating online banking acceptance among private banking
customers in Finland. The model has been tested with a survey sample (n=268).
The findings of the study indicate that perceived usefulness and information on
online banking on the website were the main factors influencing online banking
acceptance. The research paper “ on line banking: drivers, developments,
challenges and expectations” of Adel M.Aladwani54
reports the results of a
quantitative study of the perceptions of banks’ executive and IT managers and
potential customers with regard to the drivers, development challenges and
53Tero Pikkarainen, Kari Pikkarainen, Hekki Karjaluoto and Seppo Pahnila, “ Consumer Acceptance of online banking:
an extention of technology acceptance model” journal of internet research, 2004, vol.14, issue:3 pages 224-235
54Adel,M.Aladwani, “ online banking: a field study of drivers development challenges and expectations”, International
journal of information management, Vol.1 issue: 3, June 2001, pages 213-225.
36
expectations of online banking. This research paper also points out online banking
as a least understood delivery channel for retail banking services.
T.M.Bhasin55
in his research work on ‘E-commerce in Indian Banking’
found that out of various delivery channels, Internet banking is the most cost
effective and convenient delivery channels due to its inherent advantage. He has
explained the models for implementation of E-banking. He has pointed out that for
banks to sustain margin in the highly competitive consumer empowered market
they need to find a way to differentiate quality of customer service, pricing and
reliability through Internet channel. In addition to this banks need to be aware of
the potential draw back and should have requisite process in place to mitigate the
negative outcome of the Internet banking.
“Internet banking adoption in a development country-an empirical study” is
the title of the research paper published by G.Varaprased, R.Sridharan,
Anandakuttan and B.Unnithan.56
In their study they have identified the prominent
factors that influenced the public sector bank consumers in India to adopt internet
banking services. Factors such as perceived usefulness, perceived case of use,
perceived risk, relative advantage and trialability have been found to be the
determinants of internet banking in the previous studies. Along with the above
variables a new variable called conspicuousness has been analysed in this study. A
model has been proposed and tested using linear multiple regression analysis.
55T.M. Bhasin, ‘E-Commerce in Indian Banking’- IBA Bulletin, April –May 2001, Vol. XXIII, No. 4 & 5 Pages . 18-34 56 G.Varaprased, R.Sridharan, Anandakuttan and B.Unnithan “Internet banking adoption in a development country-an
empirical study”, International Journal of Services and Operations Management 2013, Vol.14, No.1 Pages.54-66.
37
“Exploring attitude of Indian customers towards internet banking” is the
title of the research work undertaken by Arpita Khare and Shveta singh.57
This
research is focused towards understanding the suitability of internet banking as a
delivery channel and consequently its acceptability in the minds of India
customers. It is stated that the customers’ concerns visible were related to
difficulty in using internet, navigating the bank website and focus associated with
committing mistakes that might result in financial loss and inconvenience.
Justin Paul and RuchiTrehan58
have undertaken a research work on
“Enhancing customer base and productivity through e-delivery channels – study of
banks in India”. In this study they analysed the impact of technology on bank
customers. This study takes in to account all the technological initiatives by banks
as part of their channel diversification. This study also describes the extent to
which these developments have taken place in the banking industry with special
reference to India. The results show that public sector banks have the least average
increase of customers as compared to other bank groups. This study has made an
effort to foresee the future of e-delivery channels in banks.
“Are online payment systems customer – centric? – A study on Indian
public sector banks” is the title of the research work undertaken by
SukanyaKundu, Saroj K,.Datta59
. In this research, the researcher has tried to
57Arpita Khare and Shveta singh “Exploring attitude of Indian customers towards internet banking” , International
Journal of Business Competition and Growth 2012, Vol.2, No.1, Pages 4-20.
58Justin Paul and RuchiTrehan “Enhancing customer base and productivity through e-delivery channels – study of
banks in India”, International Journal of Electronic Marketing and Retailing 2011, Vol.4, No.2/3, Pages.151-164.
59SukanyaKundu, Saroj K,.Datta, “Are online payment systems customer – centric? – A study on Indian public sector
banks”, International Journal of Technology Marketing 2010, Vol.5, No.4, Pages 345-362.
38
identify the features which are affecting the experience of customers of Indian
PSBs regarding payment systems of online banking. The recent growth rate of
payment systems of online banking has also been studied. Further, this research
points out that banking payment systems are making a shift towards paperless
systems from paper-based systems. It also suggest that reliable network
connection, improved privacy and security factures and standardized process of
online payment procedures are the crux to make it more customer – centric.
The research paper “Impact of customer – centric technologies on retail
banking” of Rajagopal and Ananya60
proposes criteria for successful internet
banking strategy and brings out benefits of e-banking from the point of view of
banks, technology and customer values. The authors suggested application of
technology in enhancing customer value in banking services.
The research “Factor analysis approach of decision making in Indian e-
banking: value adding consumer’s perspective” of SadiaSmar Ali, and R.K.
Bharadwaj61
investigates several factors affecting adoption of e-banking. The
prominent among these factors are ease of use of electronic banking followed by
some reluctance of customers to change relationship and trust in banker, cost of
computers, internet accessibility and security concerns. This study clearly reveals
the segment, which are in demand for attention of managers and researchers of
Electronic banking services.
60Rajagopal and Ananya, “Impact of customer – centric technologies on retail banking”, International Journal of
Business Competition and Growth 2010, Vol.1, No.2, Pages 147-161.
61SadiaSmar Ali, and R.K. Bharadwaj, “Factor analysis approach of decision making in Indian e-banking: value adding
consumer’s perspective”, International Journal of Business Innovation and Research 2010, Vol.4, No.4, Pages 298-320-
39
The research paper “Paradigm shift in productivity of e-age banking : some
evidence from the Indian banks” of R.K. Uppal62
examines productivity and
profitability in pre and post e-banking period and highlights the emerging issues
and new strategies to enhance the performance of bank groups in liberalized,
globalized and IT era. This paper concludes that there is a paradigm shift in
performance of all bank groups in post e-banking period but new private sector
banks and foreign banks have edge over public sector banks. The paper strives on
customer centric, proficient in managing assets, technology, skilled staff,
transparency, human resource management policies, customer relationship
management, merger and acquisition policies are vital factors to enhance the
performance of banks to face the emerging global competition.
The research paper “Measuring identity theft and identity fraud” of Susan
Sproule, and Norm Archer63
presents a process – oriented model of consumer
identity theft and fraud, and reports on 2008 survey of Canadian consumers.
Results are reported in standard categories of fraud: credit card, existing accounts,
new accounts, and other fraud. It is found from the research that 20 percent of
participants have stopped reduced online banking activities. It is stated that these
findings are of concern to business and Government since; if consumers stop doing
business online, the productivity benefits of online would not be realized.
62R.K. Uppal, “Paradigm shift in productivity of e-age banking : some evidence from the Indian banks”, International
Journal Education Economics and Development 2010, Vol.1, No.3, Pages 277-295.
63Susan Sproule, and Norm Archer, “Measuring identity theft and identity fraud”, International Journal of Business
Governance and ethics 2010, Vol.5, No.1/2, Pages.51-63.
40
“An empirical investigation of customer satisfaction with multi- channel
banking” is the title of the research work undertaken by Vimi Jham64
. An
exploratory study of the Indian customers in six banks was conducted to identify
the factors which led to adoption of multi-channel banking services with the help
of data reduction technique called factor analysis. It is concluded that banks in
India have succeeded in promoting new services to its customers. The likelihood
of current customers is tempted to do new business online.
An empirical research was conducted by Vimi Jham and Kaleem M.Khan65
on “Customer satisfaction with usage of banks distribution channels”. This
research examined the survey responses of 560 bank customers who provided
information regarding their satisfaction towards financial distribution channels
with respect to five banks. The study found that there were distinctive segments
within the financial market that had significantly different levels of usage of
financial distribution channels. Financial customers’ satisfaction with human
tellers, automated teller machines, money transfer at the point of sale, credit cards,
debit cards, internet banking and telephone banking was investigated and this
information was used to determine it relationship exists between customer
satisfaction and the usage of financial distribution channels.
64Vimi Jham, “An empirical investigation of customer satisfaction with multi- channel banking”, International Journal
of Electronic Customer Relationship Management 2009, Vol.3, No.2, Pages.121-131.
65Vimi Jham and Kaleem M.Khan,” Customer satisfaction with usage of banks distribution channels”, International
Journal of Financial Service Management 2008, Vol.3, No.3/4, Pages 283-294.
41
Kirti Dutta and UrvashiMakkar66
have conducted a research on “Attributes
offering the growth of online banking: a consumer perspective”. This research
delves into the trends in Internet banking and delineates the factors that affect the
use of Internet banking by customers. It was observed from the study that the
sought after benefits – encouragement, ease and accuracy, convenience and
control, life style and social factors, and bank reputation were the five most
important factors. On the other hand, factors such as the lack of knowledge and
trust, security and privacy issues and the lack of training and incentives were found
to cut as major inhibitors in Internet banking adoption.
The research work of Mohammad Sadique Khan, SibaSankarMohapatra
and Sreekumar67
on “service quality evaluation in internet banking” evaluated the
service quality of internet banking services in India from customers’ perspective.
Seven quality dimensions, viz., reliability, accessibility, user-friendless,
privacy/security, efficiency, responsiveness and fulfillment were identified based
on principal component factor analysis. The results of this research show that
customers are satisfied with quality of service on four dimensions such as
reliability, accessibility, privacy/security, responsiveness and fulfillment, but least
satisfied with the user friendliness dimension.
66Kirti Dutta and UrvashiMakkar, “Attributes offering the growth of online banking: a consumer perspective”
International Journal of Technology Marketing 2008, Vol.3, No.4, Pages.376-391.
67Mohammad Sadique Khan, SibaSankarMohapatra and Sreekumar, “service quality evaluation in internet banking”,
International Journal of Indian Culture and Business Management 2009, Vol.2, No.1, Pages.30-46.
42
The research paper “E-banking and E-commerce in India and USA” of
Shilpan D.Vyas68
explores the idea on the local conditions in India, the
Hofestede’s dimension of culture in India and USA and the diffusion of innovation
theory. It is found from the research that in USA the demand of e-banking service
is more whereas it is low in India because in USA every person has e-banking
services but in India only 24 percent people use e-banking services. It is concluded
that the future of banking industry depends on efforts of all concerned parties such
as service provided service facilitators, regulatory system and customers.
Zachary B.Omariba, Nelson B.Masese and Dr.G.Wanyembi69
have
conducted a research on “Security and Privacy of electronic Banking”. In this
study the researcher gives a brief discussion on the drivers of e-banking and also
the concerns about the e-banking from various perspectives. It is concluded that
the future of electronic will be a system where users are able to interact with their
banks “worry-free” and banks are operated under one common standard. Most
research studies have indicated that the common problem affecting information
security and privacy of customers is e-service provider’s lack of security control
which allows damaging privacy losses. A part from that another problem is the
subsequent misuse of consumer’s confidential information, as in identity theft.
These may affect customer’s confidence toward online business transaction in a
68Shilpan D.Vyas. “E-banking and E-commerce in India and USA” International Journal of Computer Science, May
2012. Vol.9, Issue.3, Page.530.
69Zachary B.Omariba, Nelson B.Masese and Dr.G.Wanyembi, “Security and Privacy of electronic Banking”, IJCSI
International Journal of Computer Science Issues, Vol.9, Issue .4, No.3, July 2012. Pages 432-446.
43
variety of privacy risk assessment by consumers. It is suggested that the
development team should be both proactive and reactive in handling security
threats, and the consumer should be vigilant when doing business online.
Naresh Sharma70
has published an article on the topic ‘Role of website in
marketing of financial services’. This paper has highlighted the various dimensions
of website and its utility in marketing products and services. It has been
emphasized that popular delivery channels like ATM, Mobile banking and Internet
banking must be used by the public sector banks to deliver their products and
services. It is suggested that Website should be developed as an effective vehicle
to enhance the image of the banks in the global financial market. It is concluded
that the website will be a very important media in future not only to market the
products but also to know what the customer desire and thus will be of immense
value in adopting suitable strategy to remain competitive.
K.K. Bajaj71
deputy Director General, National informatics center has
presented a paper about “E-Commerce related issues in the Emerging Hi-Tech
Banking Environment” at the 4th
bank Educationists Conference. It is stated that
the rationale for banks introducing ATMs, telephone banking and internet banking
is to deliver their products more cheaply than traditional branch networks which
are loaded with expensive staff. Further, technology is not an alternative way of
delivering service but usually an additional one. In this paper Internet banking has
70Naresh Sharma, ‘Role of Website in Marketing of financial Services’- IBA Bulletin, April 2003, Vol.
XXV, No.4, Pages 28-30
71K.K.Bajaj, ‘ E- Commerce related issues in the emerging HI-Tech Banking Environment,- The journal of
the Indian Institute of Bankers, Jan-March 2000. Vol. 71, No.1, Pages 14-43.
44
been described as a part of virtual banking. It is suggested that all the customers
should plug into the Internet and visit various websites instead of visiting various
physical branches to assess the cost of availing financial services.
‘What keeps the E-banking customers loyal? A multi group analysis of the
moderating role of consumer characteristics on E-loyalty in the financial service
industry’ by Arne Floh and Horst Treiblanaier72
They investigated the importance
of antecedents of online loyalty such as trust, quality of website, quality of the
services and overall satisfaction. A survey among more than 2000 customers of an
Austrian on line bank was conducted and a structural equation modeling approach
was used to gain important insight into how customer retention in the online
banking business can be ensured. Satisfaction and trust were identified as
important antecedents of loyalty.
Electronic Banking group of the Basel Committee73
has prepared a report
on ‘Management and Supervision of Cross-border Electronic Banking Activity’.
The purpose of this report is to express supervisory expectations and guidance to
banks carrying out cross-border electronic banking activities as well as to their
homes and host supervisors. It focused the need for effective home country
supervision of cross-border e-banking activities as well as continued international
co-operation between banking supervisors regarding such activities.
72Arne Floh – Department of marketing, Horst Treiblemaier- Department of information systems Vienna
university- Arne Floh @ wv- wien-ac. At Horst. Treiblemaier @ wu- wien-ac.at.
73Basel Committee ‘ Management & Supervision of Cross-border electronic banking activity, Executive
Summary July 2003
45
Elizabeth Daniel74
in her research work ‘provision of Electronic Banking in
UK and the republic of Ireland” quantified the current provision of electronic
services by major retail banking organization in the UK and the Republic of
Ireland. By use of mailed questionnaire it was found that 25 per cent of the banks
in the UK and the Republic of Ireland are already offering online transactional
service to consumers in their homes. It is also found that the organization’s vision
for future, their prediction of customers’ acceptance, which tends to be very low,
and their organizational culture of innovation are the most important of the
suggested factor in their adoption of electronic delivery.
Michel Benaroch, Robert J.Kauffam75
in their research report on ‘Justifying
Electronic Banking Network Expansion using Real option Analysis’ Illustrated the
value of applying real option analysis in the context of a case study involving the
deployment of point of sale (POJ) debit services by the Yankee 24 shared
electronic banking network of New England. It is found in the absence of formal
evaluation of the timing option; traditional approach for evaluating information
technology investment would have produced the wrong recommendation.
74Elizabeth Daniel - ‘Provision of Electronic banking in the UK and the Republic of Ireland’, international
Journal of Bank marketing, Apr 1999. Volume 17, issue 2, Pages 72-83, Publisher MCB up Ltd.
75Michel Benaroch, Robert J. Kauffman, Justifying electronic banking network Expansion using real option
analysis, mis quarterly, Vol.24 NO. 2 June 2000. Pages 197-225.
46
A research work “on on-line banking and customer retention” has been
undertaken by Deutsche bank76
. From this research work it is found that customer
satisfaction is the pre-requisite for customer retention. It is also concluded that
banks should convince more of their customers to go online and a well-known
office brand and relatively cheaper fees should be considered as an important thing
for the retention of customer.
Basel committee on banking supervision77
has placed a report on “Risk
management for electronic banking and electronic money activities”. This report
dealt with Risk management of E-banking from banking supervisor perceptive
only, and it is stated that electronic banking may allow banks to expand their
market for traditional deposit-taking and credit extension activities. In addition to
this electronic banking could reduce operational cost for banks.
Federal Trade commission78
(FTC), Bureau of consumer protection office
of consumer and business education has given a definition for e-banking. It has
further explained that e-banking is also known as electronic fund transfer (EFT)
and it can be treated as substitute for cheque and other paper transaction.
76Deutsche bank research ‘ online banking and customer retention – E. banking snapshot July 2005
77Basel Committee ‘ Risk Management for electronic banking and electronic money activity, Basle March
1998.
78Federal trade commission, 1-877- FTC- Help for the consumer, WWW. FTC.gov, Jan 2003.
47
Dr. Lisa Haris and Dr. Laura J.Spence79
in their research work on ‘Ethics
of e-banking’ explored the ethics of business to business e-commerce with a focus
on the banking sector. It is included that only with careful consideration of a broad
range of management issues of traditional companies, the challenges of e-
commerce can be addressed effectively. In addition to this the bankers to be dealt
with are far from being technical solution to do a business in cyber space.
Cunningham, Lawrence. F. Gerlach James and Harper, Michael .D80
in their
research work on ‘ Perceived risk and e –banking services’ stated that purchasing
e-banking service is perceived to be riskier than purchasing traditional banking
services. This exploratory study examined the dynamics of perceived risk
throughout the various stages of the consumer buying process. A survey of 159
respondents revealed a risk premium for e-banking services that follow a
systematic pattern throughout the consumer buying process. It is found that
financial risk drives the risk premium while psychological, physical and time risk
play ancillary role as risk driver at certain stages of the consumer buying process.
79Dr. Lisa Haris, Dr. Laura J.Spence, School of business and management, Brunel university, ‘Ethics of E-
banking’, Journal of e-commerce Research. Vol.3, No.2.2002.
80Cunning, Lawrence F. Gerlach, james and Harper, Michael D, Journal of Financial Services marketing” Wednesday,
November 16, 2005, Vol.10 issue.2, Pages-165-178
48
MOBILE BANKING
An Asia Pacific Survey81
was conducted in five countries including India,
and commissioned by Sybase 365, a subsidiary of Sybase, along with BDM
intelligence – a custom market research firm in Asia. It surveyed 1818 mobile
users. The report titled “Mobile opportunities for financial Sector” states that 81%
of Indian respondents are aware; they can check balance on a mobile phone,
while 49% have used the services in the last three months. Almost 42% of Indian
Consumers are able to state their bank balance at any given time. The survey also
points out that consumer in India (71%) are much more aware when compared to
their counter parts in the other regions on the offerings, from their banks on mobile
phones. Meanwhile, 50% of Indian respondents checked their bank balance on
their mobile phone and 54% via the internet- although the majority still obtains
account balance information through brick and mortar facilities. The survey
reveals a growing culture of financial awareness as customer is becoming
increasingly vigilant when it comes to their money.
“Efficient and secure credit card payment protocol for mobile devices” is
the research paper of Somayeh Naderi Vesal and Mohammad Fathian.82
It is stated
in this proper that many security schemes have been proposed for e-payments,
however most of them are too heavy regarding mobile devices since they use
public key cryptography for security objectives. In this paper the
81Asia Pacific Survey, “ Indians most mobile banking Savvy: Survey”, BS Reporter, Mumbai, August 22,
2007. 82Somayeh Naderi Vesal and Mohammad Fathian, “Efficient and secure credit card payment protocol for mobile
devices”, International Journal of Information and Computer Security 2012, Vol.5, No.2, Pages. 105-114.
49
researchers proposed a mobile payment protocol for credit-debit card payment
systems where in customer needs to use public key encryption and decryption
slightly.
A research paper has been published by AininSulaiman, Noor Ismawati,
Jaafar, Suhana Mohezar83
on the topic “An overview of Mobile banking adoption
among the urban community”. The main focus of this paper is on the adoption of
mobile banking services by consumers. Rogers’ diffusion of innovation model was
adopted to study the consumers’ behavior and motivation towards this innovation.
The personal characteristics of mobile banking users were found to be important
determinants of their adoption decisions. It is concluded from the study that with
the better understanding of customer perceptions of mobile banking services
financial services industry can plan their marketing strategies and promotion
approaches for mobile banking services in the future.
The payment committee of Internet and mobile association of India
(IAMAI)84
has presented a discussion paper with regard to draft operating
guidelines on Mobile Banking Transactions which has been issued by the
Department of payment and Settlement of RBI on Sept 19,2008. This paper
includes comments, issues and suggestions. In this paper it is emphasized that the
guidelines for mobile payment in India should be further divided into ‘customer
present’ and ‘customer not present’ transactions. The mobile payment guidelines
83AininSulaiman, Noor Ismawati, Jaafar, SuhanaMohezar, “An overview of Mobile banking adoption among the urban
community”, International Journal of Mobile Communication 2007, Vol.5, No.2, Pages 157-168.
.
84IAMAI, Discussion paper, “Mobile Banking Transactions in India, Operative Guidelines for banks”, Sept 2008, Pages
1-5
50
should not be applicable in case of ‘ customer present’ scenarios where the cards
are swiped (i.e., the payer and the payee are in front of each other) even if the
transactions are processed through a mobile phone. In addition to this, RBI has to
appreciate and take into account the roles played by telecom operators and other
payment service providers as they are important players in the eco-system. The
concluding comment of the IAMAI is that the RBI should appreciate the need for
‘financial Inclusion’ to increase the reach of banking and financial services to
common man as large population of the country still is unbanked, under-banked or
under-served.
A research paper has been published by Abhay Jain and B.S.Hundal85
on the
topic “Barriers in Mobile banking adoption in India”. In their research they have
examined the forces that can act as barriers in mobile banking service adoption.
The quantitative survey sheds more light on this research issue. Data were
collected from a survey in the northern region of India and includes 330
respondents. It is emphasized that the service providers should be more interested
to enhance their understanding of consumer behaviour patterns in order to rise up
to the challenges.
The study of Pin Luarn and Hsin-Hui Lin86
“Towards an understanding of
the behavioural intention to use mobile banking”, has extended the applicability of
the technology acceptance model (TAM) in a mobile banking context, by adding
85Abhay Jain and B.S.Hundal, “Barriers in Mobile banking adoption in India,” The ICFAI Journal of Bank
management, Vol.66, No.3, August 2006, Pages 64-73
86Pin Luarn and Hsin-Huilin, “Towards an understanding of the behavioural intention to use mobile banking’, published
online on 30 April 2004.
51
one trust- based construct (“Perceived credibility”) and two resources- based
constructs [“ perceived self- efficacy and “perceived financial cost’] to the model,
while paying careful attention to the placing of these constructs in the TAM’s
existing Homological structure. Data collected from 180users in Taiwan were
tested against the extended TAM, using the structural equation modeling approach.
The result strongly supports the extended TAM in predicting user’s intentions to
adopt mobile banking. Several implications for IT/IS acceptance research and
mobile banking management practices were discussed.
The research article “mobile banking and economic development: Linking
adoption, impact and use” of Jonathan Donner87
emphasizes the need for research
focusing on the context of mobile banking/ mobile payments use. Presenting
illustrative data from exploratory work with small enterprises in Urban India, it
argues that contextual research is a critical input to effective “adoption” or
“impact” research. Further, it suggests that the challenges of linking studies of use
to those of adoption and impact reflect established dynamics within the
information and communication technologies and development research
community.
Citi bank88
has conducted a research on mobile banking technology in
Australia. From this research it is found that 25 percent of mobile phone users in
87Jonathan Donner, “ Mobile Banking and Economic Development: linking adoption, impact, and use,” Asian Journal
Communication, 2008, Vol.18, issue.4, pages 318-322, http:/www. Informa world.com.
88Citi Bank,’ Millions of Australians ready to embrace mobile banking technology, media release Sydney 2 may 2005
52
Australia is likely to pay bill via mobile and 24 percent are also likely to transfer
fund using their mobile. It is concluded that millions of Australians are ready to
embrace mobile banking technology.
ELECTRONIC PAYMENT AND E- CHEQUE
“An online, Transferable E-cash payment System” is the research paper of
R.Sai Anand and C.K.Venimadhavan89
. In this paper, they proposed a payment
system where coins can be transferred over multiple hands, spread over various
transactions, similar to physical cash. In this system the verification is distributed
across multiple entities as opposed to the case of a coin-issuing entity or a central
bank alone being responsible for verification. A resolution mechanism for
handling disputes is also presented.
N.R.Sunitha and B.B.Amberker90
have conducted a research on e-cheque
particularly in relation to e-receipt. The title of the research paper is “New
signature Derivation using Existing signature”. In their initial work on new
signature derivation, they have come up with a method in which customers
themselves can generate such signed receipts based on the signature available on
already completed transactions without the intervention of the bank which in turn
reduces the work load on the bank. In all the signature derivations they made, care
has been taken that a new signature derived is similar to the one that the signer
89R.Sai Anand and C.E.Veni Madhavan, “ An online Transferable E-cash Payment systems.’ INDOCRYPT 2000,
LNCS 1977, Pages 93-103, Springer-verlag Berlin Heidelberg 2000.
90N.R.Sunitha and B.B.Amberker, “ New Signature Derivation using existing signatures,” International Journal of
Recent trends in Engineering, Vol.1, No.1, May 2009 Pages 47-51 Academy Publisher 2009.
53
would have generated if he had signed himself and also all signature either existing
or derived are verified using the same verification equation.
The study of G. Premkumar, K.Ramamurthy and Sree Nilkanta91
on
“Implementation of electronic data interchange: an innovation diffusion
perspective” examined the relationship between various innovation characteristics
(complexity, two forms of compatibility, cost, relative advantage, and
communicability) and various attributes of diffusion [adapt ion, internal diffusion,
external diffusion, and implementation success] of EDI in organizations. The data
for the study were collected from a large-scale field survey of 201 firms in the
United States that have implemented EDI. The results of the multivariate
regression analysis revealed that relative advantage, cost, and technical capability
were the major predictors of adaptation. While relative advantage and duration
were important predictors of internal diffusion, technical capability and duration
were found to be important predictors of external diffusion. Both forms of
compatibility and costs were found to be important predictors of implementation
success in EDI.
The article “state of the art in electronic payment systems” of Asokan.N and
A.Phillipe92
surveys the state of the art in payment technologies and sketches
emerging developments. This article provides an overview of electronic payment
91G.Premkumar, K.Ramamurthy and Sree Nilakanta, “Implementation of Electronic Data interchange: an innovation
diffusion perspective”, Journal of management information systems, Vol.11, Issue .2 Sept 1994, pages 157-186.
92Asokan,N and A. Phillipe, “ the state of the art in Electronic payment systems”, IEEE computers 1997, Klupm,
edu.sa.
54
systems, focusing on issues related to security. The concluding part of the article
states that properly designed electronic payment systems can actually provide
better security than traditional means of payments, in addition to flexibility of use.
Electronic money: understanding its use to increase the effectiveness of
policy” is an article of Supriya singh93
. This article presents a methodology for
exploring the user’s perspective, drawing on case studies on the actual use of
electronic money. In this article it is emphasized that policy on electronic money
and electronic commerce will be more effective if there is a better understanding
of the use of electronic money. It also discusses about the challenges which are
faced by the providers and policy makers.
Sunitha.N.R.Amberker B.B.,Koulgi.P. and Siddharth.P94
presented a
research paper regarding “secure e-cheque clearance between financial
institutions”. In this paper they have emphasized the use of zero knowledge
protocol to perform secure inter FI e-cheque clearance operations. They have also
suggested a method using which one can verify that two signatures received from a
signer indeed belongs to the same signer without the help of public key of the
signer.
93Supriya singh, Centre for international research on communication and information technologies at Royal Melbourne
institute of technology, Australia, Electronic Money: Understanding its use to increase the effectiveness of policy”,
Published online on 17th Dec 1999.
94Sunitha N.R. Amberker B.B.Koulgi.P.Siddharth.P “secure e-cheque clearance between financial Institutional”, E-
Commerce Technology and the 4th IEE international conference on enterprise computing, E-commerce and E-service,
2007 CEC/EEE 2007 July 2007, pages 99-106
55
K. Mohan Chandran95
in his research on “Electronic Cheque – the emerging
payment system” defined E- Cheque as a cheque in the electronic form which
contains the exact mirror image of a paper cheque and is generated, written and
signed in a secure system ensuring the minimum safety standards with the use of
digital signature and asymmetric crypto system. He stressed the need for using e-
cheque. He has suggested the use of e-cheque as a means for reducing the cost of
producing, issuing and maintaining the cheque. Further the usage of interest and e-
cheque would totally eliminate physical movement of cheque.
M.J.Subramanyam96
faculty member of syndicate bank has published an
article about “Real time Gross Settlement”. He has described Real time gross
settlement as a system of transferring funds from one bank to another on an
immediate basis. In this system, the transactions are settled individually without
netting debits against credits. In this article the salient features of RTGS has been
pinpointed further the researcher has explained that, under this system, the funds
received could be utilized immediately without any risk or fear of non-receipt of
payment in due and RBI has been satisfied with the result achieved by this system.
95K. Mohan Chandran, “ Electronic Cheque – The emerging payment system” – IBA Bulletin, July 2003,
Vol- XXV, No.7, Pages 6-18
96M.J.Subramaniyam,”Real time Gross settlement- Revolutionizing the payment and Settlement system”,
IBA Bulletin, Dec 2004, Vol.XXVI, No.12, Pages 15-27.
56
“Bank automation with special reference to remittance and payment
system” is an article of Shri.H.Dinesh Nayak97
, executive director of Indian Bank.
He pointed out electronic fund transfer as an important element for meeting
customer demand in Indian banking industry. He further pointed out various ways
to avoid frauds in EFT such as ensuring automation of transmission of data with
built in security mechanism. The prerequisite for establishing EFT have also been
given in this article.
Dr.Ashutosh Saxena98
in his study on “Digital certificate” stated that digital
certificate will help banks in the issuance of Internet payment or banking software
to the customer to prove that the software in genuine one and if a bank issues a
customer with one digital certificate for all his credit and debit, it will know a lot
about that customer and it will be able to carry out effective one to one marketing.
He concluded that banks in future can team up with utilities or retailers to provide
digital certificate service.
Dr. Firdos T. Shroff99
in this research article on “implementation of Real
time gross settlement’ stated that payment and settlement system serve an
important role in the economy as the main arteries of the financial sector. It has
been the endeavor of the RBI to improve the efficiency of the financial system
97Shri.H. Dinesh Nayak, ‘Bank Automation –Remittances & payments’ – IBA Bulletin, Jan 1995, Vol
XVII, No.1, Pages 70-72.
98Dr.Ashutosh Saxena, faculty, IDRBT, Hyderabad, ‘Digital Certificates Opportunities for Banks, - IBA
Bulletin. May 2005, Vol XXVII, No.5, Pages 12 –14.
99
Dr. Firdos T.Shroff, ‘ Implementation of RTGS- Preparedness and roll –out strategy for banks’ – Bank
quest, Jan- March 2005, Vo. 76, No.1, pages 18-25.
57
by ensuring safe, secure and effective payment and settlement systems that is
through RTGS. He has noted that the network technology has enabled the banks
to cross physical barrier and makes bank as a unit and customer becomes a bank
customer from a mere branch customer. He suggested that banks should initiate
necessary steps for all round participation in RTGS mechanism and sort out and
settle issues from time to time.
ATM AND CREDIT CARD
Preventive measures for ATM frauds” is the research article of Praveen
Dalal100
. In this article he has discussed the nature of the problem associated with
ATM and preventive solutions in details. Separate solutions are given for banks
and customers. The solutions for banks are categorized as designated time,
microchip technology, biometric tokens, enhanced security, ATM monitoring,
customized software, customer motivation, Alerts and insurance solution. The
solution for customers availing ATM services are grouped as precautionary
solutions and insurance solutions. It is concluded that the big threat of ATM fraud
requires a coordinated and co-operative action on the part of the bank, customer
and the law enforcement machinery.
100Praveen Dalal, “Preventive measures for ATM Frauds,” http:/ www. blogger.com, computer crime Research center,
June 29, 2006.
58
The research paper “ATM reliability and risk assessment issues based on
fraud, security and safety” of R.K.Saket, Bharath Bhushan Sagar and Gurmit
Singh101
presents reliability and risk assessment issues of the ATM system based
on fraud, security and safety. These have been identified described and
recommended for reliability of the ATM system. To fully understand the scope of
the international problem and the potential solutions, the actual electronic process
of an actual ATM machine has been described. The types of frauds that have been
perpetrated in the International level have been detailed, and the potential for
money laundering have been explained. Finally, solutions for reliable practices
based on safety and security procedures have been introduced in this paper.
Antonella De Angeli, Uday Athavankar, Anirudha Joshi, Lynne Coventry
and Graham I.Johnson102
have undertaken a research on “ATMS in India” and
published it as a research paper. This research paper presents a method and results
of an ethnographic study aimed at building an understanding of ATM adoption in
Mumbai, India. This study combined field observation and semi-structured
interviews of early ATM adopters, bank customers who do not use ATMs and
people who used the ATM for the first time as part of the research. Data were
analyzed to identify specific cultural
101R.K.Saket, Bharath Bhushan Sagar and Gurmit Singh, “ATM reliability and risk assessment issues based on fraud,
security and safety” International Journal of Computer aided Engineering and Technology, 2012 Vol.4, No.3, Pages
.272-293.
102Antonella De Angeli, Uday Athavankar, Anirudha Joshi, Lynne Coventry and Graham I.Johnson, “Introducing
ATMs in India: A contextual inquiry”, published online on 24 Dec 2003.
59
traits that may affect the adoption of ATMs in Urban India. Results demonstrated
that unique role of the cultural context in affecting users’ expectations and
behavioural possibilities, thus determining people response to the machine. This
led to the conclusion that an understanding of cultural biases and metaphors can
facilitate technology diffusion and acceptance, informing design localization and
supporting the development of strategies to motivate and train users.
“Product innovation- KCC vs. ATM” is an article of P.Siva Rama103
An
important point emphasized in this article is that, the products must meet the needs
of the customer to survive in the competitive market irrespective of the cost
involved in its development. It is stated that if KCC (Kisan credit card) is upgraded
more farmers could be attracted to commercial banks fold, which is a good
business strategy. ATM KISAN CARD will enable the commercial banks to
enlarge the base of high value agriculture advances and it will boost the image of
the commercial bank. Upgrading kisan credit card as ATM KISAN CARD
involves no additional cost to the bank since the existing ATMs can be used for
ATM KISAN CARDS.
“The booming credit card business of Indian banker” is the title of the
research work, which has been undertaken by Tapas Ranjan Saha104
. In this study a
thorough analysis has been attempted on the credit card business in
103P.Siva Rama Prasad, ‘ Product innovation, KCC vs. ATM’ – Bank Quest- April – June 2004, Vol.75,
No.2, Pages. 29-31 104
Tapas Rajan Saha, “ The booming Credit card business of Indian Banker,” Management Accountant-
Calcutta, 2003, Vol.38, part 5, publication: Institute of cost & works accountant of India”, pages 371-379.
60
India both from the bankers’ point of view and from the users’ point of view. This
study has been carried out with the objective to derive which banker is providing
the maximum benefits to the consumers and making maximum profit through best
possible credit management of a credit card business in India. In this study the
researcher has also identified and explained the different types of credit cards
available in India, facilities of credit card, liabilities of credit card holder, customer
service network of various card issuing bank and finally the future of credit card
business in India. It is found from the study that credit cards in India are extremely
useful to the huge middle class people who use the increase the purchasing power
through that plastic card.
Leena Bhatia, Bindu Jain105
have conducted a research on “card base
payment mode-an accounting perspective: a comparison between credit card and
debit card payment system in India”. In this study, the researchers have conducted
a survey to know how an ordinary Indian customer feels about electronic payment
so that business houses can make changes in their accounting systems to
incorporate the customers’ choice. This study shows that followed by the
slowdown, Indians continue to spend online in the last quarter of 2008 to emerge
as the third largest spenders on the internet in the Asia pacific region. It has been
observed from the study that the credit card and debit card payment systems are
more common as compared to other modes of electronic payments.
105Leena Bhatia, Bindu Jain, “card base payment mode-an accounting perspective: a comparison between credit
card and debit card payment system in India”, International Journal of Management and Financial accounting
2013, Vol.5, No.1, Pages. 33-44.
61
B.J. Parimala Kalarani106
has undertaken a study on “ Bank Services with
special reference to the use of credit card in Trichirapalli. An indepth study has
been made on various credit cards schemes offered by banks and utilized by the
merchants, establishments and the cardholders of the fast developing corporation
of Tiruchirapalli. This study has revealed the existence of tremendous scope for
the growth and expansion of market for credit card business in Tiruchirapalli and
certain measures need to be implemented by the parties of credit card dealings to
make the credit card system effective.
Morten.L.Bech and Bart Hobijn107
faculty of Federal Reserve Bank of New
York have conducted a research work on “Technology diffusion with central
banking: The case of Real Time Gross Settlement”. In this study they have
examined the diffusion of real-time gross settlement technology across all 174
central banks. They have found that the RTGS diffusion process is consistent with
the standard S-curve prediction. Real GDP per capital, the relative price of capital,
and trade patterns, explain a significant part of the cross-country variation RTGS
adoption. These determinants are remarkably similar to those that seem to drive
the cross-country adoption patterns of other technologies.
106B.J.Parimala Kalarani, ‘A Study on Bank Services with reference to the use of credit card in Tiruchirapalli.
107Morten L.Bech and Bart Hobijn, “Technology diffusion within central banking: The case of real time Gross
settlement,” Federal Reserve Bank of New York, FRB of New York staff Report, No.260, Sept 2006.
62
Dr.R.N. Srinivasan108
conducted a research on the title ‘use of plastic cards in
passenger ticket reservation’ in March 1999 through the department of
management of studies, Bishop Heber College to assess the use of credit cards in
railways and found that the plastic card is yet to pick up momentum.
Vijay Dube109
in his study on credit card fraud stated that credit card fraud
is one of the most preventable forms of robbery – it only takes a small quantum of
initiative and common sense to prevent from falling prey to this activity and he
suggested various steps to be taken to prevent credit card frauds.
TECHNOLOGY
“Globalization and contemporary Banking: on the impact of new
technology” is the title of an article written by Costas lapavitsas and Paulo.L.Dos
Santos110
. This article depicts the fact that money –dealing transactions have
become cheaper but investment costs have increased and the cost of efficiency of
banks has not improved. In this article, it is stated that new technology and related
practices have facilitated the entry of foreign banks into developing countries,
where they can exploit ‘arm’s length’, technologically demanding niches in
domestic markets. This has not improved the efficiency of
108R.N.Srinivasan, Det of Management studies, Bishop Heber college, March 1999, “ use of Plastic Cards in passenger
ticket reservation”.
109Vijaya Dube, Training Manager, PNB, ZTC, Delhi, “Credit card frauds – prevention is better than cure” – IBA
Bulletin, May 2005, Vol XXVII, No.5 Pages 16-18.
110Costas Lapavitsas and Paulo L.Dos Santos, “ Globalization and Contemporary banking : on the impact of new
technology - contributions to political economy advance access published online on April 9, 2008, published by Oxford
University Press.
63
host banking system, nor increased the availability of credit to the productive
sector.
Arvind Mohan111
has published an article on “Core Banking System”. In
this article he remarked that high customer expectation and customer satisfaction
leading to customer loyalty is the key to any bank’s success. Further, the rapid
shift towards electronic transaction in the form of ATM, debit card, home and
wireless banking has made real-time core banking system a requirement to support
the up-to-the minute balance reporting requirements that the order system cannot
support. He suggested that the banks should ensure logical access control through
techniques like user ID, Password, smart cards etc. The concluding remarks given
in this article are that the banks should have a flexible and expandable system that
can handle functions in addition to traditional deposit management, banks internal
accounting and financial activities. Hence Re-engineering of business through
sophisticated technology based products will not only leads to business creation,
cut down operational expenses and enhance the efficiency of operations of banks.
P.P. Pathrose112
in his research work on “Product development and
marketing in banks”, stated that products must be customized to meet the various
needs of individual customers and diverse types of customers. He observed that
modern delivery channel like ATM, Telephone banking, internet banking, cluster
111Arvind Mohan,’ Core Banking Systems’ –IBM Bulletin, Feb 2003, Vol. XXV, No.2 Pages. 30-31
112 Pathrose P.P, ‘Product Development and Marketing in Banks’ – IBA Bulletin Feb 2003, Vol –XXV, No.2 Pages. 32
– 34
64
banking etc, are helping banks as a cheaper way for delivering products to
customers than the traditional one. He concluded that the banks having strength
and competence to convert the challenges into opportunities will be the winner.
N.Sreenivasan113
in his research on ‘core banking solution’ observed that
Internet banking and ATM, banking is cost effective as compared to transactions
made in branches. It is concluded that banks should plan for business process Re-
engineering to attract additional business. Further it should plan for providing
convenience banking through more delivery channels like ATM, Tele banking, Pos
etc and should strive for reducing transactional cost by way of Internet banking, E-
commerce and mobile banking. Only by this way banks can look for achieving
reasonable return on investment at the shortest possible time.
Dr.V.T. Godse114
has furnished a report on ‘Technology. In this report he
stated that IT facilities provided multiple delivery channels for extending banking
products and services and the delivery channels like Tele-banking, Internet
banking have changed the equation between the banks and customer. He further
explained that the end-use of technology.
113N. Sreenivasan, “ Core Banking solution” – IBA Bulletin September 2002 Vol- XXIV, No.9,Pages. 17-
19
114Dr.Vasant Godse, Senior Consultant, I-Flex Solution Ltd., Mumbai, ‘Technology. An Impact Analysis’
– Bank Quest – The journal of Indian Insitute of Banking & Finance, Jan-March 2005, Vol-76 No.1, Pages
14-17.
65
M.R. Das115
has undertaken a project work on the topic “opportunities and
challenges for Indian banking’. In this a limited sample survey of a few eminent
bankers, academicians, experts of industry associations and bureaucrats has been
carried out to test the conclusion. To assess the efficiency of the banks the Return
on Equity (ROE) Decomposition analysis has been used. This project work
revealed that internet banking has the potential for banks to lower transaction
costs, offer increasing number of products and services in a timeless manner and
thereby maximizing customer satisfaction, enhancing geographical reach and also
enabling entry into new market. Further as for as non-residents are concerned
Internet banking possesses a lot of potential. It is concluded that the banks have to
implement several practical but difficult policies to take on the new era, which can
remain safe and sound in a profitable way.
K.V.Kamath, S.S.Kohli, P.S.Shenoy, Ranjana Kumar, R.M.Nayak,
P.T.Kuppusamy and N.Ravichandran116
have published an article regarding
“Indian banking Sectors’ challenges and opportunities”. In this article, it is
emphasized that the new rules of competition must require recognition of the
importance of consumers and the necessity to address the needs through innovative
products supported by new technology. It is suggested that banks may have to go
for mobile banking services for a cluster of villages.
115M.R. Das, ‘Opportunities and challenges for Indian Banking’- IBA Bulletin, October 2003, Vol. XXV, No.10, Pages
15-20
116K.V.Kamath, S.S.Kohli, P.S.Shenoy, Ranjana Kumar, RM Nayak, PT.Kuppusamy and N.Ravichandran, “Indian
Banking Sector: Challenges and opportunies”, Vikalpa, Vol.28 No.3, July- Sept 2003, Pages 83-99.
66
Alternatively, technological institutions have to come out with low-costs, self-
service solutions/ ATMs. In addition to this, a wider dissemination of information
of technologies and products to the Indian banking industry by the research
institutions could benefit the banking institutions. It is concluded that the cross-
pollination of ideas would mutually enrich the banking and the technology
development processes.
Mrs.Ranjana Kumar117
has made an attempt to explore the strategies for
“restructuring of banks”. In her article she stressed the need for technology up
gradation and innovation. It is remarked that success lies in aligning technology
with the business strategy and redefining processes to get maximum advantage.
The concluding part of her article highlighted that banks should adapt themselves
to the changes, innovate and introduce new technologies to meet the needs of the
customers. Banks which have new and innovative business model in the place will
be geared to meet the challenges and compete effectively in the market.
Dr. K. Subramanian118
has published a research article on “information
technology- A transforming tool for the Indian banking Industry”. This paper
outlined the concept of cost effective rural operations of the Indian finance
industry by means of appropriate automation and communication channels to
117Mrs.Ranjana Kumar, “Restructuring of Banks an overview,” Bank Quest, the Journal of India Institute of
banking and Finance, Vol.74, No.4, Oct-Dec 2003 Pages 20-24
118Dr.K.Subramanian, ‘Information Technology – A Transforming tool for the Indian Banking Industry’ –
IBA Bulletin, Jan 1993, Vol -XV, No.1, Pages 109-113.
67
utilize the funds available at the rural sector for the overall development of Indian
Economy.
Ajaya KumarMohanty119
in his research work on ‘ Technology as
competitive edge’ stated that only those institutions who leverage advancement of
technology in innovation of new products, customer convenience, re-engineering
process and delivery modes etc. will be the ultimate winner. He has quoted the
directions of Dr.Rengarajan Committee. He further explained that the technology
will definitely be a cutting edge against the rivals if it is implemented by
wholehearted participation of personnel with customer focus aiming at customer
delight. It is suggested that shared network is to be widened and spread to all
cities, an integrated customer legislation should be passed and administered and
necessary directions should be given by RBS and MOF to frame new set of
customer delight guidelines.
M. Sitarama Murthy120
in his study on “Innovations in Banking
Technology” observed that the transmission of images and messages through
electronic media and avoiding physical movement of instruments can bring about
dramatic changes. He pointed out ATM as an excellent customer oriented,
‘Convenience’ product.
119Ajaya kumar Mohanty, “Technology as Competitive Edge,” -IBA Bulletin, March 2004, Vol. XXVI, No. 3 Pages.14
– 18.
120M.Sitarama Murthy, Former Managing Director, State Bank of Mysore, Secunderabad, “Innovations in Banking
Technology” – IBA bulletin, Nov 2004, Vol XXVI, No.11, Pages 40-43.
68
He has also found that networking of branches with a core banking solution will
through up a multiple of new products and services and make banking a pleasant
experience.
Deepak Jain121
has published an article on the topic “Risk management for
electronic banking”. In this article he remarked that the unprecedented
development of electronic banking has increased some of the traditional risks
associated with banking activities viz., operational reputational, legal, credit,
liquidity, interest rate, market, country risk etc. He has also given a wide
description of various types of risk associated with electronic banking. For
managing such risk he has outlined some necessary things to be considered by
every institution such as criticality of data, sensitivity of system and vulnerability
of network. He suggested that the banks must have a comprehensive risk
management process in place including the basic elements of assessing risk,
controlling risk and monitoring risk.
Dr.A.Vinayagamoorthy122
has published an article on the title ‘Information
technology and Electronic Commerce”. This article includes a significant
discussion over the various services of banks through electronic media such as
phone banking, ATM, Credit card, Electronic fund transfer, shared payment
network system, electronic clearing services, Point of sale,
121Deepak Jain, ‘ Risk Management for Electronic Banking’ – IBA Bulletin Dec 2002, Vol XXIV, No.12, Pages. 28-33.
122Dr. A. Vinayagamoorthy, ‘Information technology and electronic Commerce’ - INDIAN ECONOMIC
PANORAMA, Oct 2006, Vol.16, No.3, Pages 21-25
69
D-Mat account, electronic data interchange, E-cheque, corporate banking
Terminal. In this article it is stated that e-banking has given an opportunity for
banks to find solutions to manage problems like saving time and energy of
customers by reducing or minimizing paper work, waiting in queues, lack of
communication and lack of efficiency. As for as D-mat account is concerned, it
has the capability of reducing the paper work, bad deliveries and loss of shares and
less transaction cost. In addition SEBI should find a way to overcome the illegal
activities of depository participants with the help of D-mat. The various benefits of
E-banking have been discussed in this article.
“Core banking-change in form, not in substance” is an article written by
Durai Rajesekar123
. In this article a modest attempt has been made to broadly
define the scope and parameters within which a bank can look for selection of a
core banking solution for implementation. It has described core-banking system as
a backbone of retail bank, which facilitate central accounting, customer
information and transaction processing functions. It is stated that banks are
custodians of public fund and hence a core banking solution should be secure
enough to insure against financial loss caused by frauds, misappropriation and
embezzlement. It should have highest-level access controls to safeguard against
intrusions and should support well-defined and time tested audit and control
procedures.
123Durai Rajesekar, “Core banking- Changes in form, not in substance” –Bank quest- July- September 2003,
Vol.74, No.3 Pages. 8-13.
70
Xiaofeng Chen, Fangguo Zhang and Yumin Wang124
have published a
research paper on “A new approach to prevent blackmailing in e-cash”. In this
paper, some disadvantages D.Kuglers’s scheme are analysed and then a new online
electronic cash scheme to prevent blackmailing is presented by using group blind
signature technique. In this scheme, the blackmailed cash was marked by an entity,
called supervisors; therefore the bank can distinguish it from the valid cash. Also,
one can modify this scheme to be offline so that it can be used to decrease other
crimes, e.g. money laundering, bribery etc. in electronic cash system.
CUSTOMER SERVICE
A study has been undertaken by Hsin-Ginn Hwang, Rai-Fuchen and Jai-min
Lee125
on “measuring customer satisfaction with internet banking”. A web survey
was used with the subject being internet banking user of Taiwanese banks. A total
of 226 valid questionnaires were obtained with an 85% response rate. For the
development of a standardized instrument, an exploratory factor analysis was used.
The study demonstrates that all the items in the Doll and Torkzadich instrument
for end-user computing satisfaction measures are still valid in the context of
internet banking, and that IBCS (Internet banking customer satisfaction) depends
heavily on security and trust considerations on the internet.
124Xiaofeng chen, Fangguo, Zhang and Yumin Wang,” A new approach to prevent Blackmailing in E-cash,” National
Science foundation of china, Crazymount @ hotmail.com.
125Hsin-Ginn Hwang, Rai-Fu Chan, and Jai-Min Lee, “Measuring customer satisfaction with internet
banking: an exploratory study.” International Journal of electronic Finance, 2007, vol.1 No.3 Pages 321-335
71
“Customer satisfaction and retail banking: an assessment of some of the key
antecedents of customer satisfaction in retail banking” is the title of the research
paper published by Ahmad Jamal and Kamal Naser126
. This paper reports, findings
from a survey which looked into the impact of service quality dimensions and
customer expertise on satisfaction. A sample of 167 respondents took part in this
study. Findings indicate that both care and relational dimensions of service quality
appear to be linked to customer satisfaction. Findings also indicate that expertise is
negatively related to satisfaction. This paper discusses implications for bank
managers.
“Antecedents to perceived service quality: an exploratory study in the
banking industry” by Spiros P.Gounaris, Vlassis Stathakopoulous, & Antreas
D.Anthanassopoulos 127
. Using empirical data derived from the greek banking
sector, the authors attempted to model the influence of bank-specific (market
orientation) and customer-specific (comparison shopping, influence by word-of –
mouth communication and personal relations with bank’s employees] Parameters
on the customers’ perception of service quality. The findings suggest, that the
various dimensions of the quality of service offered by a bank are not influenced
by all the antecedents examined in this study. Moreover, the gravity of the
influence that each of the examined parameters exercises on
126Ahmed Jamal and Kamal Naser, “ Customer satisfaction and retail banking: an assessment of some of the key
antecedents of customer satisfaction in retail banking,” International journal of bank marketing, Vol.20, issue-4 2002,
pages: 146-160.
127Spiros P.Gounaris, Vlassis Stathakopoulos, Antreas D.Anthanassapoulos “Antecedents to perceived service quality,
an exploratory study in the banking industry,’ International journal of bank marketing, 2003, Vol.21, issue.4 pages 168-
190.
72
customer’s perception of the various dimensions of quality was also found to vary
considerably with certain dimension being more influenced by the same parameter
than others. Based on these findings, the authors suggested specific implications
for both the academia and practitioners in the banking industry.
The study of A Gauri Shankar128
on “Customer services in banks” depicted
that excelling and managing customer relationship is the future of any business or
every day’s business. Customer focusing is not be viewed as just as business
strategy but should become a corporate mission. It is observed that the speed with
which the banks offer their services would actually gain a competitive advantage
and allow them to offer higher satisfaction. It is added that a successful banker can
be judged by his ability to manage the expectations of his customer. The
concluding remarks given in this research article is that building value for
customers should be seen as equal to building shareholders value.
P.V. Anantha Bhaskar129
has made an attempt to explore the importance of
‘Customers service in Banks’. This research has stressed the need for customer
satisfaction. It has been emphasized that in order to achieve the highest level of
customer satisfaction, technology should be upgraded to speed up the services in
all sphere of banking. An important suggestion pointed
128A.Gauri Shankar, “Customer Service in Banks” IBA Bulletin, Aug 2004 Vol. XXVI, No.8, Pages 5-8
129P.V.Anantha Bhaskar “Customer services in Banks” – IBA Bulletin, Aug 2004, vol. XXVI, No.8, Pages 9 –13
73
out here is that the technology Implementation should be speeded up such
as computerization, electronic banking through channel migration process. The
conclusion derived from this research is that once good service is extended to a
customer, a loyal customer will work as an ambassador to the bank and facilitate in
the growth of business.
Dr. K. Santhi Swarup130
in her study on “Customer orientation in banks for
building long term relationship” found that for delivering quality service it is
imperative to have customer orientation as a culture in the bank. Customer
orientation builds long-term relationship resulting in customer satisfaction and
cash flow to the banks. The researcher suggested that the bankers should adopt
customer satisfaction as their basic objective, besides this customer satisfaction
audit should be carried out regularly to find out the area of discrepancies and try to
improve customer perception.
“Service quality, customer satisfaction, and customer loyalty in Indian
Commercial banks” is the title of the Research article published by Usha Lenka,
Damodar Suar and Pratap K.J.Mohapatra131.
In their study they have examined
whether service quality of Indian Commercial banks increases customer
satisfaction that fosters customer loyalty. Data were collected from 350 valued
customers of scheduled commercial bank branches in Orissa (India). It is
suggested that better human, technical and tangible aspects of
130Dr.K.Santi Swarup, ‘Customer orientation in Banks for building long Term Relationship’ – IBA Bulletin, Aug 2004,
Vol-XXVI, No.8, Pages 17-20
131Usha Lenka, Damodar Suar and Pratap, K.J. Mohapatra, “Service Quality, Customer satisfaction, and customer
loyalty in Indian commercial banks” Journal of enterpreneurship,vol.18, No.1,2009, pages 47-64
74
service quality of the bank branches, would increase customer satisfaction. Human
aspects of service quality were found to influence customer satisfaction more than
the technical and tangible aspects. Customer satisfaction furthers customer loyalty.
Increase in service quality of the banks can satisfy and retain customers. It is added
that in the Indian Banking sector, human aspects are more important than technical
and tangible aspects of service quality that influence customer satisfaction and
promote and enhance customer loyalty.
Dr. S. Hasanbanu132
in her research work on ‘Customer Service in Rural
bank’ analyzed the attitude level of different types of customers towards banking
services in rural branches. All kinds of customers like businessmen, agriculturists,
professionals, pensioners and housewives have been chosen for this study and it
was based on sampling method. This study revealed that 36 respondents with low
level of attitude, 182 respondents with the medium level of attitude and 32
respondents with the high level of attitude. It is suggested that computerization of
banks should be implemented in villages also that customers will be disposed off
quickly and they can also gain computer knowledge. In addition to this frequent
training should be given to officials with practical knowledge so that they can
impart it at the branches.
A research work has been undertaken by Dr.Ramesha, Dr.S.G.Hudekar,
Dr.B.D. Kumar133
on “Marketing strategies that brightens the future friendly
132Dr.S. Hasanbanu, ‘Customer Service in Rural Banks: An Analytical Study of Attitude of different types of
customers towards banking services’ –IBA Bulletin, Aug 2004, vol XXVI, No.8, Pages. 21-25.
133Dr. Ramesha, Dr.S.G. Hundekar, Dr.B.D. Kumbar, Karnataka University, Dharwad, ‘Marketing Strategic Brightens
the future customer friendly banking services’ –IBA Bulletin Aug 2004, Vol XXVI No.8, Pages 26-29
75
banking services”. A modest attempt has been made in this to explore the need for
strategic planning for marketing banking services and different types of marketing
strategies for making the banking services more relevant, qualitative customer
specific and market specific. It is noted that technology in particular Internet is a
driver of internal change. The valuable suggestions given in this research is that
the customers must make an application for core banking services and open new
account for exploiting the convenience of Internet banking. It is concluded that the
banks in the days to come have to provide their broad-based service package in the
midst of stiff competition and to ensure their competitive edge, in addition they
have to fight with rivals in terms of their customer services.
1.9 STATEMENT OF THE PROBLEM
The Indian banking industry has now entered a new phase where in
challenges both within the banking sector and from the economy have to be
catered. Rapid changes in the financial service environment increased competition
by new players. Globalization and liberalization have led to a market situation
where bottle for customers has become intense. In order to rise up to the
challenges, banks have forced to introduce new innovative customer centric
products and services with the help of modern electronic delivery channels.
Technology is enabling banks to provide the convenience of anytime, anywhere
banking to increasingly demanding customers. The earlier brick and mortar branch
is no longer sufficient. As technology gives consumers more delivery choices than
even before they are expecting more delivery alternatives, more personalized
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service and greater access. The world is witnessing and experiencing the dramatic
change from cash to card like credit card, debit card, smart card to online payment
and fund transfer which will in effort create a cashless society. In this context, the
fast growing electronic banking is significant for this study.
The bankers and financial experts consider innovation and technology as
key differentiators in the financial services businesses to some extent. Today,
electronic banking is used as a strategic tool by global banking sectors to attract
customers. The benefit of modern electronic payment systems are not spread
evenly among all sections of society and across different regions of the country.
Even though banks in competitive environment are introducing more and more
new innovative and value added services, it is not known whether the users of e-
banking products are fully aware of the services available within each product, or
they are satisfied with the services. Because of the above mentioned issues, it is
pertinent to conduct the study in the field of e-banking from the aspects of
customers. Many studies have been conducted with respect to e-banking in abroad,
but in India only limited study has been made so far. Due to lack of research work
from the dimension of customer perception and lack of popularity of e-banking in
Thajavur, it was felt necessary and important to conduct a study to know the
perception and satisfaction level of customers towards e-banking products
particularly ATM cum Debit card, credit cards, internet banking mobile banking,
RTGS, NEFT, ECS any branch banking. The purpose of this study is to find out
whether the e-banking customers are aware of various services available within
each e-banking product, how far they are utilizing these services, and bring out
77
their level of satisfaction that is to what extent they are satisfied and also the
problems perceived by e-banking customers with respect to each product
separately. The result will help the study banks to adopt right strategy to increase
their quality of service which in turn results in customer loyalty.
1.10 OBJECTIVES OF THE STUDY
The overall objective of the study is to assess customer’s satisfaction
towards e-banking products in selected banks. The following are the specific
objectives of the study.
� To understand the e-banking products and services in India.
� To assess the socio-economic profile of e-banking customers.
� To assess the e-banking customer’s awareness and utilization of
E-banking services of the study banks.
� To identify the problems perceived by e-banking customers in the study
area.
� To find out the level of satisfaction of e-banking customers of the study
banks.
� To offer valuable suggestions on the basis of findings for the improvement
of e-banking services in the study banks.
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1.11 HYPOTHESIS
On the basis of the respondents’ responses, the following null hypotheses
are tested in the appropriate places.
� There is no association between respondent’s socio-economic profile
and number of years of availing e-banking services.
� There is no association between respondent’s socio – economic profile
and frequency of usage.
� There is no association between respondent’s socio-economic profiles
and awareness towards e-banking services.
� There is no association between respondent’s socio-economic profiles
and utility of e-banking services.
� There is no significant difference between banks and level of problems
with respect to each e-banking product.
� There is no significant association between respondent’s socio-
economic profiles and level of problem related to each e-banking
product.
� There is no significant association between overall problem and level of
satisfaction.
� There is no significant difference between banks and level of
satisfaction with respect to e-banking products and services.
� There is no significant association between respondent’s socio-
economic profiles and satisfaction level.
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1.12 RESEARCH METHODOLOGY
A study on customer’s satisfaction towards e-banking was conducted
among the customers of SBI and ICICI banks who were selected on the basis of
simple random sampling in Thanjavur town.
The study is based on both primary data and secondary data. The empirical
part of the study is based on the primary data collected through the questionnaire
to a sample of e-banking customers of SBI and ICICI banks in this area.
Descriptive and inferential analytical methodology has been adopted in the study.
In order to evolve a suitable method for the collection of comprehensive data and
incorporation of as many essential questions as possible in the questionnaire, a
pilot study has been conducted with the sample of sixty respondents. The
reliability of questionnaire was tested using Cronbach Alpha co-efficient. The
researcher has verified the reliability of questions related problems and under nine
dimensions and also satisfaction. The following table shows the reliability of
different dimensional items.
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Table 1.1
RESULT OF CRONBAC’S ALPHA
Items No. of items Cronbac’s Alpha
Common problems with e-banking 13 0.910
Problem related to ATM 10 0.941
Problems resulted to credit card 39 0.970
Problems related to debit card 8 0.904
Problems related to Internet bank 8 0.914
Problems related to Mobile banking 3 0.713
Problems related to RTGs, NEFT and ECS 3 0.818
Problems related to any branch banking 4 0.835
Problems related to fraud 12 0.909
Satisfaction towards E-banking products and
quality of service
19 0.964
Source: Primary data
The above table shows that all items were highly reliable that is greater than
recommended level of 0.60 and achieved the internal consistency.
For sampling of respondents only Thanjavur Town is chosen. Since there is
a constrain of popularity of e-banking services in the interior parts of Thanjavur,
the scope for approaching respondent using different e-banking products with
different experience and character is high in Thanjavur town. Therefore, it is found
appropriate to select samples from Thanjavur town only. The samples were
selected on the basis of simple random sampling.
Based on the pilot study, 90 percent of the e-banking product users
especially net banking, credit card and debit card were identified belonging to
State Bank of India and ICICI Bank in Thanjavur town. Therefore data were
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collected from the e-banking customers of these two banks only and the products
that are commonly provided by these two banks were taken for this study.
As per the records of the study banks, the total number of e-banking users
in SBI is around 30,000 and the number of e-banking customers in ICICI is around
35,000 in the study area. One percent of total population is selected as sample
ie.650 for the study. The questionnaire was distributed to 650 respondents of study
banks in the study area. After the follow-up of the 650 distributed questionnaire
482 usable were received. Of the 482 usable questionnaires 262 belongs to ICICI
bank’s customers and 220 belongs to SBI bank’s customers. From the total of 482
respondents, all respondents are using ATM – cum – Debit Card, 184 respondents
are Credit Card users, 130 are Internet banking users, 46 are NEFT users, 40 are
RTGS users, 32 are ECS users and 48 respondents are Any branch banking users.
1.13 PERIOD OF THE STUDY
During the study period of 2007-2013, primary data was collected in the
financial year 2011-2012 in which four quarterly months of June, September,
December and March were taken for the purpose of collecting primary data from
the respondents in the year. Secondary data up to March 2013 were utilized for this
study.
1.14 SOURCES OF INFORMATION
Both primary data and secondary data were used for the study. The
secondary data was collected from different newspapers, National and
82
International Journals, Banking and other Magazines, Research Publications,
organization reports and websites.
Questionnaire with stamped envelopes and personal interviews have been
used to collect the primary data. The responses of the respondents in bank
premises, ATM centers, Government and private offices, colleges and Universities
were used to collect the primary sources of data in this area for the study.
1.15 FRAMEWORK OF ANALYSIS
According to the chosen methodological research approach the quantitative
data was analysed using statistical methods such as percentage, chi-square test,
student t-test one way ANOVA and Multiple Response Analysis.
1.16 LIMITATION OF THE STUDY
The present study is restricted to Thanjavur town due to constrain related to
popularity of the growing e-banking services in this area. The survey has been
conducted only among the customers of SBI and ICICI banks and the e-banking
products of these banks are only taken for the study. In future the e-banking users
can be selected throughout the entire Thanjavur District, taking other banks into
consideration and the results can be compared and generated for the e-banking
providers in India.
There are some limitations to overcome the validity, Reliability and threats,
which are clearly related. The instruments used in the study are developed
specifically for this research purpose. Every care has been taken to ensure the
83
validity and reliability of the instruments. However, the threats of reliability, which
has close relation with the time of data collection, cannot be ruled out. Researches,
who are interested to use this instrument for this purpose, can conduct a fresh
reliability analysis which may help in overcoming these problems.
1.17 CHAPTERISATION
The discussion of this study is presented in seven chapters they are:
Chapter I – Introduction
The first chapter outlines the framework of the study which reviews of
literature on the various research works done in the related area both in India and
abroad, with focus on the statement of problem, objectives of the study, hypothesis
framed, methodology adopted, sample taken up for the study, limitations and
chapterization of the thesis.
Chapter II – E – Banking Products and Services
An attempt is made in this chapter to provide theoretical framework in a
nutshell the historical developments of each e-banking product such as ATM,
Debit Card, Credit card, Internet banking, Mobile banking, RTGS, NEFT, ECS
and various services offered under each product, growth and development of e-
banking products, RBI initiatives for the development of e-banking products, fraud
related to e-banking and also steps taken by RBI to avoid frauds.
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Chapter III Socio – Economic Profiles of the E-banking Customers
This chapter analysis the e-banking customer’s socio – economic variables
such as age, sex, educational qualification, occupation, marital status, income and
other factors like preference and reason for preference of e-banking products,
motivational factors influencing to select e-banking products, number of years of
usage, number of times transactions done through electronic channels for the past
three months and their views on safety and security of e-banking transactions and
also their views on efficiency enhancement.
Chapter IV –Awareness and Utility of E-banking Services
This chapter deals with the analysis of the data pertaining to the awareness
and utilization of service offered to the respondents. Only the products that offer
multiple services like ATM, Debit Card, Credit Card, Internet banking, Mobile
banking and Any branch banking were taken for analysis. Services are classified
according to nature of service. In case of ATM the services are classified in to
convenience services and value added service. The credit card services are
classified as convenience service, value added service, benefit based service,
Insurance services. Based on the category of services the awareness and utilization
has been assessed. This chapter analyses both descriptive and inferential methods
of important statistical tools and techniques such as multiple response analysis and
chi-square test.
85
Chapter V – Problems perceived by E-banking customers
In this chapter E-banking customers perception on various problems has
been analysed. The problems related to each e-banking product has been analyzed
separately and views on problems resolution and incidence have been evaluated
The problems are classified in to difference categories, such as ATM related
problems, Debit card related problems, credit card related problems, Internet
banking related problems, mobile banking related problems, RTGS, NEFT, ECS,
and problems related to fraud. All the major classifications of problems have been
analysed by using a five point Likert Summated rating scale to evaluate the e-
banking customer’s perception.
Chapter VI – Customers’ Satisfaction towards E-banking Products and
Services
The six chapter deals with the analysis of data pertaining to the
satisfaction of e-banking services offered to the respondents. This chapter was also
finding out if there is any association between problems and satisfaction and also
between satisfaction and socio-economic profiles of respondents.
Chapter VII Summary of Findings, Suggestions and Conclusion
Finally, the seventh chapter is a summary, and conclusions are outlined
briefly based on the analysis and evaluation of the study. It includes the future
scope for the further research.
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CHAPTER II
ELECTRONIC BANKING PRODUCTS AND SERVICES
E-banking implies provision of banking products and services through
electronic delivery channels. Electronic banking has around for quite some time in
the form of automated teller machines. Then it has been transformed by the new
delivery channels like internet, mobile etc., that has facilitated banking
transactions for both customers and banks.
Delivery of banking products and services through various electronic
distribution channels is collectively referred to as e-banking. It has provided
opportunities for banks to expand their market and to offer new products and
services. Some of these products are discussed in this chapter.
2.1 AUTOMATED TELLER MACHINE
An automated teller machine is a computerized telecommunication device
that provides the clients of a financial institution with access to financial
transactions in a public space without the need for a cashier, human clerk or bank
teller.
An ATM is a machine in which a customer can use his/her bank card along
with PIN to get cash, information and other services. On most modern ATMs, the
customer is identified by inserting a plastic ATM card with magnetic stripe or a
plastic smart card with a chip that contains a unique card number and some
security information such as an expiration date and or verification value.
87
Authentication is provided by the customer entering a personal identification
number (PIN).
As ATM is an excellent customer oriented convenience product. It provides
round the clock service with ease and privacy of operation. It reduces pressure on
bank staff and avoids congestion in the bank premises.
2.1.1 HISTORY OF ATM
The idea of self service in retail banking developed through independent
and simultaneous efforts in Japan, Sweden, the United States and the United
Kingdom. The history of ATM can be traced back to the 1960s. When a
rudimentary cash dispenser was invented by Luther George Simijian and
established by the city bank of Newyork1. The machine is called Bankograph was
an automated envelope deposit machine (accepting coins, cash and cheque) and
did not have cash dispending feature. The concept of this machine was for
customers to pay utility bills and get a receipt without a teller. However, the
machine did not work much and had to be removed within six months of putting
up the machine. One June 27, 1967, a Barclays bank branch in Enfield Town in
North London, debuted the first cash dispenser. The instance of the invention has
been credited to John Shephard Borron. The machine was called De La Rue
Automatic cash system or DACS. It used paper voucher bought from tellers in
advance as plastic cards had not yet been invented.
1en.wikipedia.org/wiki/automaticteller-machine.
88
On September 2, 1969, Docutel installed its Docuteller machine at
Newyork’s chemical bank. This is the first card accepting machine and the first use
of magnetically encoded plastic card. Although the first card accepting ATM came
about in 1969, the first ATM card did not come about until 1972. In the year
between 1969 through 1972, one had to have a credit card to utilize an ATM. City
National bank of Cleveland issued the first ATM card.2
The idea of a PIN stored on the card was developed by a British Engineer
James Goodfellow in 1965. About the same time Diebold installed its first TABS
machine at a bank branch in the US and Fujitsu installed one in Japan. In 1974
online ATMs introduced. Notable historical models of ATMs include the 1BM
3624 and 473 x series, Diebold 10xx and TABS 9000 series and NCR 50xx series.
While there were many developments in the history of ATM, the service itself took
a stronghold only in the 1970s. ATMs first came in to use in December 1972 in
UK.3
2.1.2 ATM IN INDIA
ATMs were introduced to the Indian banking industry in the Mid 1980s
initiated by foreign banks. HSBC was the first bank to introduce ATM in India in
1987.4 Later new private sector banks have taken the lead in introducing ATMs in
a big way. Most foreign banks and some private sector players suffered from a
2Inventors.about.com/od/astartinventions/a/atm.htm.
3.www.atminventor.com/atm-history.html.
4www.gii.in/india/history-of-atm.
89
serious handicap at that time due to lack of a strong branch network. ATM
technology was used as a means to partially overcome this handicap by reaching
out to the customers at a lower initial and transaction costs and offering hassle free
services. Since then, innovations in ATM technology have come a long way and
customer receptiveness has also increased manifold. Public sector banks have also
entered the race for expansion of ATM networks. Today, all public sector banks
are taking the installation of ATMs seriously for Indian market. They are either
setting up their own ATM centre or entering into tie-ups with other banks.
ATMs saw a period of inaction before they were accepted by Indian
masses. For instance in 1988 India had just 500 ATMs. But how, ATMs have
gained prominence as a delivery channel for banking transactions. Banks have
been deploying ATMs to increase their reach. As at the end of March 2013, the
number of ATMs deployed in India was 1, 00,0005. More people are now moving
towards using the ATM for their banking needs. According to a survey by
BankNet India 95 percent people now prefer this modern channel to traditional
mode of banking. Almost 60 percent people use an ATM at least once a week.6
In the past, ATM devices captured customer’s transactions and sent them to
the core banking system as batch updates. In todays’ increasingly connected world,
customers expect their financial institution to provide single consistent view of
their finance. The online support for ATM helps to meet their customer’s
5www.rbi.org.in
6news.oneindia.in
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expectation. Modern ATM is designed to operate in a centralized multi-branch
data configuration in which each ATM device is connected to an ATM host. The
ATM host passes transactions to bank vision for authorization. All transactions
originating from an external network (ATM/POS) are passed through BASE24 for
routing or authorization. Increased ATM usage in helped by the fact that customers
have now the flexibility of using ATMs of other networks as most of the banks are
part of major interbank networks like National Financial Switch (NFS), Mitr,
BANCS, Cash tree, Cash net.
2.1.3 INTER BANK NETWORK
Interbank network or shard payment network has been introduced in India
in line with the recommendations of the Rangarajan committee. “Swadhan’ is the
India’s first shared payment network launched by Indian Bank’s Association. It
became operational as a pilot project in Mumbai in 1998.7
It was started with the intention of reducing the investment required to
deploy ATMs. The main drawback of the network however, was that it was not
hooked to a central switch and there was no core banking solution backing it. The
member banks were at different levels of technology and had very few cardholders
as a result of which the network became uneconomical as such Swadhan saw the
end of the day effective Dec 31, 2003.
7http://www.banknetindia.com/atm/network
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On 26th
July 2003, a quarterl was formed consisting of IDBI Bank, Citi
Bank, Standard Charted Bank and UTI bank under the umbrella, ‘cash net’. On the
same day another shared network known ‘as’ ‘cash tree’ was formed consisting of
Bank of India, Union Bank of India, United Bank of India, Syndicate Bank, Indian
Bank.
On August 27, 2003, Punjab National Bank announced a strategic alliance
with Oriental Bank of Commerce, Indian Bank, UTI bank, Global Trust Bank for
sharing their ATMs spread across the country under the banner Mitr. With the
closer of Swadhan effective Dec 31, 2003, the Chennai based switch company has
helped the creation of new network consortium BANCS consisting of 14 from
Swadhan and five public sector banks belonging to cash tree network.
National Financial Switch was conceptualized, developed and implemented
by IDRBT. The institute started off the switch by connecting the ATMs of three
banks. Thereafter, the institute continuously worked towards bringing all banks on
board and by Dec 2009, the network had grown to connect 49880 ATMs, of 37
banks. There by emerging as the largest network of Shared ATMs in the country.
The institute handed over the NFS to National Payment Corporation in 14 Dec
2009. As at Sept. 2013 the NFS network connects 133180 ATMs.8
Some banks have joined more than one Shared ATM network to give their
customers the choice to transact business at more locations across the country.
8http://www.dnb.co.in/BFSI Sector.india
92
Banks find it cheaper to pay membership fees to these networks as against starting
up additional units in expensive to deploy areas. It is also considered as an
effective marketing channel resource.
Earlier ATM was merely a cash dispending machine. But now ATMs are
seen to be more than mere cash dispensing machines. Customers use ATMs to
recharge their mobile phone, prepaid connections, pay their utility bills, even
mutual fund transactions, making them at par with flexibility given in internet
banking.
2.1.4 KINDS OF ATMs
There are different kinds of ATMs used by the banks for the customers. The
kinds of ATMs can be categorized according to the location, links, card insertion,
loading of cash and on the basis of functioning.
Kinds of ATM
Location Link Card insertion Loading
of cash Functioning
Onsite Offsite Stand
alone
Networked
Dip card Motorized
Front Back
Cash
dispenser Full
function
93
2.1.4.1Cash dispenser and full functioning: Cash dispenser allow customers to
only withdraw cash and receive a receipt of the account balance. Full functioning
ATM is a complex machine which accepts deposit, facilitate credit card payment,
utility bill payment etc. To access advanced feature of this machine, a customer
usually needs to be a member of the bank that operates the machine.
2.1.4.2Onsite and Offsite: ATMs which are situated at the premises of the banks
are known as onsite ATMs and the one that are located at some busy places are
known as offsite ATM like railway station, bus stops, shopping malls, petrol
pumps etc.,
2.1.4.3Standalone and Networked: ATMs which are not linked to the hub of the
bank to which it belongs are standalone ATMs. But these are not popular now
days. Net worked ATM on the other hand are those which are linked to the branch
and also linked to the branches across the country means a customer of a particular
bank can withdraw money from any branch of any bank at any city.
2.1.4.4 Dip and Motorized: Where the customer is required to dip the card and
take it back to do the transaction is known as dip card. The sensor of the machine
identifies the customer and greats him with the voice. On the other hand,
motorized ATMs are very prevalent among all. In this the customer inserts the card
in the machine and takes it back when the transaction is over. In some machines
immediately the card is taken back whereas in some machines, the card
automatically comes out when cash is withdrawn.
94
2.1.4.5 Front and Back: Cash has to be regularly loaded in the ATM machine. In
the front loading, the door of the ATM compartment is closed and cash is loaded
where as in back loading, it is done behind the ATM and a message is displayed
that “please wait for some time, some services are being carried on”.
2.1.5 ATM SERVICES:
The evolutionary trend from cash economy to cheque economy and
onwards to plastic economy is witnessed in the introduction of ATMs. The ATMs
were born as a result of the customers need for quick and better service and to have
access to money all the 24 hours. Although ATMs were originally developed just
as cash dispensers, they have evolved to include may other bank related functions.
2.1.5.1 Cash withdrawal and Balance Enquiry: In spite of a number of
innovative services being made available at many ATMs, cash withdrawal still
remains the most accessed service at ATMs. However, the migration of routine
bank transactions like cash withdrawals and balance enquires from teller counters
to ATM significantly raises the potential for savings in employee costs and greater
employee focus on value added revenue enhancing activities. The withdrawal
limits are set by card issuing banks. The limit is displayed at the respective ATM
locations.
2.1.5.2Bill Payments: Most utilities have inadequate infrastructure for receiving
bill payments resulting in long queues at collection centres. Hence bill payment at
ATMs has achieved noticeable acceptance by bank customer. Most banks provide
this service through bilateral arrangements with bill payment service providers.
95
Some bank’s ATM even accepts charitable contributions to temples and
some banks provide credit card bill payment facility. It is a revolutionary service
which enables the card holder to transfer money from his/her debit card to credit
card any time anywhere in India.
2.1.5.3Fund Transfer: Modern ATMs are equipped with the flexibility to allow
online transfer of funds between cardholders various accounts linked with his/her
ATM-cum-debit card.
2.1.5.4 Recharge Mobile via ATMs: ATMs are also used to recharge mobile
phones. Initiated in 2004 by ICICI bank, now most ATM/debit cardholders are
able to recharge their prepaid subscription of most mobile service providers from
anywhere in the country using their banks’ ATMs by sending a SMS9. The amount
of recharge would be debited from the subscribers’ bank account and the
subscription would be directly recharged accordingly.
2.1.5.5 Sale of Paper Based Products: ATMs are ideally suited to sell paper
based products and services such as tickets, recharge cards, financial products etc.
The screen interface allows browsing and customization, access to bank account
facilitate payment and printing capabilities produce the actual product or service.
A number of banks including ICICI bank SBI and PNB have ATMs at Mumbai
local railway stations to dispense season tickets to commuters. Own bank
9http://www.banknetindia.com
96
customers pay no extra charge while other bank customers pay a fee of Rs.50 for
this extremely useful service of anytime ticket purchase.
2.1.5.6Third party advertising: In India, ATM advertising for third party
products is currently not allowed by regulatory authorities. However, customer
wait-time at ATM while transactions get processed typically between 10-25
seconds has been profitably used by many banks for their own advertising.
2.1.5.7Cheque book requested and change of PIN: Cheque book request can
be made through multi-functioning ATMs. One can also easily change PIN a
security number provided at the time of opening card account. It is an important
feature while considering security threats.
2.1.5.8Generate Statement of Account: Now a days there are specially designed
ATMs for instance ICICI bank ATMs which can print detailed account statement
for a period as requested by the bank customer.
2.1.6 BENEFITS OF ATM FROM CUSTOMER’S PERSPECTIVE
� Easy access to cash day and right on week end/ holidays.
� Fast service – No need to wait in queues.
� ATMs can be accessed in any convenient location in the city.
� Privacy in transaction.
� Free from errors.
� Flexibility in withdrawal,
2.1.7 BENEFITS OF ATM FROM BANKER’S PERSPECTIVE
� Cost of setting ATM is much lower than setting a branch.
� Fewer burden on staff for cash withdrawal,
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� Wider choice with the bank to advertise their products through ATM.
� Less hassle in handling cash.
� Increase market penetration.
� Provide an alternative to extended hours.
2.1.8ATM FEE IN INDIA
In India, ATM annual fee is (Rs.100 in Government bank and Rs.500 in
private bank). In 2007, the RBI had issued a directive to all commercial banks
to freeze ATM charges and with effect from 1st April 2009, abolish ATM
service charges all together. Earlier, banks charged between INR 10 and INR
35 per reciprocal transaction is limited. Today a person holding card of other
banks can withdraw amount from other banks’ ATMs but the amount of
transaction is limited after 5 to 6 transactions.
However, banks can still surcharge for items such as credit card ATM cash
advances and at foreign ATMs. In addition, RBI imposes significant foreign
exchange restrictions on the use of Indian debit visa, master card abroad.
In the same directive, free mutual ATM usage was requested to five free
such transactions per monthly statement cycle beyond which a cap of INR 20
has been fixed for ATM cards issued to saving bank or term deposit account
customer.
2.1.9 GROWTH AND DEVELOPMENT OF ATM IN INDIA
The ATM market in India is not yet saturated. ATMs have become an
important channel for delivering banking services in India, particularly for cash
98
withdrawal and account balance enquiry. According to National Payment
Corporation of India – nearly 200 million transactions are processed every
month through NFS and 75 percent of this is simple cash withdrawal
transactions. The average ticket size of withdrawal stands at Rs.3300. The
balance 25 percent transactions are non – financial transactions.10
Table 2.1
ATMs of scheduled commercial banks
Year/
Category
Onsite
Growth
Rate
Off
site
Growth
Rate
Total
Growth
Rate
Offsite
as %
of
Total
ATM
Onsite
as % of
Total
ATM
2008-09 2464 - 19006 - 43651 - 43.5 56.40
2009-10 32679 32.59 27474 44.55 60153 37.80 45.67 54.33
2010-11 40729 65.26 33776 77.7 74505 70.68 45.33 54.67
2011-12 47545 92.92 48141 153.3 95686 119.21 50.311 49.89
2012-13 55760 126.25 58254 206.50 1,14,014 161.2 51.09 48.91
Source: Compiled from RBI report on trend and progress of banking various issues
The above table indicates the progress made by ATMs of scheduled
commercial banks for the period 2009-2013. The growth rate has remarkably
increased in 2013 in case of both onsite and offsite ATMs taking the year 2009
as base year. The percentage of onsite ATM is high in the year 2008-2009. But
it has declined from 54.67 percent in 2010-11 to 49.89 in 2011-12. Over the
years, the relative growth in offsite ATMs has been much more than that of
online ATMs. As a result by 2012-13, offsite ATMs accounted for more than
half of the total ATMs in the country.
10http://www.thehindu.com/business/industry
99
Table 2.2
Bank Group wise ATMs of Scheduled Commercial Banks as at end March
2013.
Source: RBI report on trend and progress of banking March 31, 2013
The above table indicates bank group wise ATMs of scheduled commercial
banks. The highest number of ATMs both onsite and offsite is in case of public
sector banks and which is 61.09 percent of total ATMs in the country. In percent
terms ATMs in case of Nationalized banks is 31.01 percent, in case of SBI group it
is 28.58 percent which is more than that of old private sector banks and foreign
banks. New private sector banks have major share ATMs (37.80%) as compared to
old private sector bank and foreign banks in 2013.
2.1.10 LOW PENETRATION OF ATM
For the ATM industry, India has huge market with vast potential. It is a country
of 1.2 billion people, 40 percent of them unbanked according to RBI and VISA
estimates that 91 percent of consumer purchases by banked and unbanked Indians
alike are made with cash.11
11http://www.atmmarketplace.com
Bank Group
Onsite
ATM
% of
Total
Offsite
ATMs
% of
Total
Total
Number
of
ATMs
% of
total
Onsite
ATMs as
% of
total
ATM
Offsite
ATMs
as %
of
total
ATM
Public Sector Bank 40241 72.17 29411 50.48 69652 61.09 57.77 42.23
Nationalized Bank 20658 37.05 14701 25.24 35359 31.01 58.42 41.57
SBI Group 18708 33.55 13883 23.83 32591 28.58 57.40 42.59
Private Sector Bank 15236 27.32 27865 47.83 43101 37.80 35.35 64.65
Old Sector Bank 4054 7.3 3512 6.03 7566 6.64 53.58 46.42
New Private sector Bank 11182 20.05 24356 41.80 35535 31.17 31.47 68.53
Foreign Bank 283 0.507 978 1.65 1261 1.10 22.44 77.56
All banks 55760 100 58254 100 114014 100 100 100
100
Penetration of ATMs in the country is still very low compared to other
emerging markets even as the number of automated teller machines is increasing
by nearly 25 percent every year. As of March 2012, the entire country had about,
90,000 ATMs to serve an enormous population. This averages out to a rate of one
ATM per 13,333 citizens. By contrast, the US has about 400000 ATMs or one
ATM for every 779 citizens more than 17 times highly than India’s ratio12
. Part of
India’s ATM to citizen ratio problem was that only banks were allowed to own
ATMs though they were able to outsource the management of their networks.
In order to speed up the penetration the RBI announced in April 2012 that it
would allow for the first time, the white labeling of ATMs in India. Under this, any
non-bank entity with a network of at least Rs.100 crores is eligible to setup, own
and operates ATMs. These networks will provide services to customers of Indian
banks, who can use their debit card to access cash. White label operators will
receive payment for use of the ATM from the bank and they will not be allowed to
charge customers for transactions.13
Of the ATMs in rural India, about 20 percent
are owned by private sector banks. The ratio is expected to change with the entry
of white label ATM operators.
To expand the ATM network at a brisk pace over the next few years, finance
ministry has introduced Brown label system in 2011. In this system third party
providers run and maintain an ATM using a bank board.14
12artiles://economictimes.indiatimes.com/collections
13archive.indian express.com/news
14www.rupeetimes.com
101
With banks outsourcing their ATM services to third party they can
concentrate on core banking. There is better efficiency in ATM maintenance
and certainly a speed deployment alongside low cost.
2.1.11 TECHNOLOGICAL DEVELOPMENT IN ATM
Strides in technology have blessed us with several innovations like next
generation multi-function ATMs which could help financial institutions reduce
their operating cost. It is designed to accept cheques without any envelope and
is scalable to offer bulk cheque deposits and is in sync with RBI’s current
initiative of getting banks technology ready to offer cheque truncation.15
NCR self-serve 32 is equipped with self-healing technology to
automatically recover from software failure and downtime without
intervention, cutting down recovery time previously ranging from 3-4 hours to
10-15 minutes.16
Many ATM vendor have devised specialized machines, embedded with
biometric devices for authentication, catering to the rural population, these
machines have enabled them to interact with the machine in their local
language and on a graphical user interface. The ATM with in-built biometric
capabilities had been used by Union Government to disburse wages under the
Mahathma Gandhi National Rural Employment Guarantee Programme. This
15http://www.chase.com
16www.hcr.com/products/banking
102
has the potential to further widen the scope of ATM usage in the interior parts
of the country.17
In an attempt to increase the convenience of customers using ATMs, banks
have launched mobile ATM service. This service is meant to serve the banks’
customers when numbers of stationary ATM outlets are less.18
Banks and many ATM vendors are very conscious of devising eco-friendly
ATMs. On Dec 19, 2009 InduSind Bank inaugurated Mumbai’s first solar
powered ATM as part of its green office project campaign. The new solar ATM
replaces the use of conventional energy for 8 hours a day with eco-friendly and
renewable solar energy. Energy saving is accompanied by simultaneous
reduction in CO2 emissions.19
Banks are in the process of upgrading their ATMs to cash collecting
machine which will help in channelizing a large part of cash lying with public
in the banking system. NCR has come up with intelligent deposit ATMs which
will give the bank’s customers the flexibility to execute every day cash deposit.
Another innovation is talking ATM. Talking ATM is a type of ATM that
provides audible instructions so that persons who can’t read on ATM scheme
can independently use the machine. All audible information is delivered
17www.thehindu.com
18www.mobilemoney.net
19www.alternative-energy-newsinfo/solar powered-atms
103
privately through a standard headphone on the face of the machine. India’s first
‘talking’ ATM for visually impaired was inaugurated on June 6, 2012 in
Ahmedabad by Union Bank of India.20
The future of ATM technology will see the use of machines without the
cards. More banks are set to adopt a technology that allows their customers and
third parties to withdraw cash from ATM without a card. This new generation
of ATMs works alongside a mobile banking application that can be
downloaded on to a mobile phone in order to ensure that security is not
compromised.21
2.1.12 OPPORTUNITIES AND CHALLENGES FOR ATM IN INDIA
The current scenario presents a huge opportunity for ATM deployment in
India. The future trend report 2012 of ATM Industry Association indicates that
by 2015 India would be second only to China. There is a great demand from
the unbanked population.22
The RBI is asking banks to open at least one quarter of their new branch
banks every year in unbanked areas with a population less than 10,000. ATM is
the key plat form to reach this segment across the country. Many banks are
already using human ATMs to reach its unbanked rural population. Unbanked
people in India will start seeing more and more options to perform transactions,
thereby bringing these people closer to financial institutions and technology.
20timesofindia.indiatimes.com
21www.hindustantimes.com/business
22www.atm market place.com
104
The focus has shifted from simply installing hardware to making these
machines smarter and towards managing and serving them. On the whole, with
an emphasis on financial inclusion, rural banking, and a liberalized RBI policy
where banks are encouraged to open new branches as well as attract new
customers and also with the concept of multi-functional machines the Indian
ATM Industry is set to get smarter.
ATM security is one of the biggest concerns for the Indian banking
industry. For the physical security of ATMs, measures such as guards and
caretakers, surveillance cameras, machine grouting etc. are already prevalent.
Banks are considering DVSS (Digital Video Surveillance System) solutions to
provide additional security plan additional measures to prefect ATMs from
skimming, network, virus and access brands attacks.
RBI has quoted a federal bank report dated May 30, 2012 to state that ATM
frauds containing 487 incidents were noticed across India involving an amount
of Rs.83.35 lakh. As per the report, few persons have defrauded the bank by
taking part of withdrawal amount and allowing the balance to be taken back by
the ATM. In order to combat the menace the RBI has given approval to NPCI
to disable cash retraction feature in ATMs.23
An increase in crime at ATM has prompted the RBI to request all banks to
install remote monitoring device that would automatically alert police about ATM
tampering. There is also need for a stringent policy for banks which is
23archieve.indianexpress.com
105
happening but slowly. Factors like bad weather, poor telecommunication and
network make it difficult to expand ATM network in many parts of the country.
While wireless or satellite solution exists, these data connections suffer from
congestion issues and fail to offer full coverage across the country. These are
some of the key challenges which have been addressed partially.
Thus, all the banks are making continuous effort to improve the ATM
services because this is the service due to which electronic banking services are
growing in India. Wide acceptance of ATM by consumers, introduction of
biometric ATMs and increasing scope of value added ATM service will
maintain growth in the industry.
2.2 DEBIT CARD
Debit card is an electronic card issued by a bank which allows bank clients
access to their account to withdraw cash or pay for goods and services. This
removes the need for bank clients to go to the bank to remove cash from their
account as they can just go to an ATM or pay at merchant locations. This type
of card, as a form of payment, also removes the need for cheques as the debit
card immediately transfers money from the clients account to the business
account.24
In other words, a debit card is a plastic card like a credit card by which
money may be withdrawn or the cost of purchases paid directly from the
holder’s account at no interest.
. 24www.investopedia.com
106
The major benefits of this type of card are convenience and security. Along
with the convenience of accessing account funds at any time it also removes
the hassles associated with writing cheques. It is also considered to be a safer
form of payment as PIN is required to access account. The debit cards are
performing the role of bank cashiers through ATM. Debit card is mainly used
for cash withdrawal from ATM, payment at POS, and also for online purchase,
paying bills etc. Banks provide debit card free of cost at the time of opening
account.
2.2.1HISTORY OF DEBIT CARD
The first debit card may have hit the market as early as 1966, according to a
report by the Kansas City Federal Reserve. The Bank of Delaware piloted the
card. And by the ‘70s, several other banks were trying out similar ideas. Robert
Manning, author of Credit Card Nation said debit card picked up in the ‘80s and
‘90s as more and more ATMs started cropping up across the country.25
Credit card paved the way for debit cards. Many people used credit cards to
pay for transactions. This also put in place the infrastructure that debit cards
needed to be practical as a method of payment. In US Seattle’s First National Bank
offered the first debit card to business executives in 1978.26
Initially they were like
a check signature or guarantee card, with which the bank would guarantee that the
fund would be paid. They also required a large saving account be kept at the bank
25www.brighthug.com/money/personal
26www.msnb.msn.com
107
to cover the funds. These cards were only issued to people who had a long and
good standing with the bank, because the funds were not directly debited from the
account. These types of cards generally come with the VISA or Master card
symbol on them.
In 1984 Landmark created the first nationwide debit system, using ATMs
and other networks that allowed debit cards to be used nationwide. As technology
improved, the debit card moved to a system that was able to directly debit the
money from an account. When this happened, the debit cards became available to
more and more consumers. In 1998 debit card transactions first outnumbered the
use of cheques around the world.27
In India, debit card was first introduced by Citi Bank in the year 1998 and
was first launched in Bangalore. Corporation bank was the first Indian Bank to
introduce debit card.28
Though foreign and private banks were the first ones off the
block in issuing debit cards, the real growth in the penetration of debit card has
resulted from the entry of public sector banks.
The debit card has seen a growth zoom when banks started converting its
ATM cards in to debit cards. Debit cards have had a staid and steady growth in
India. Indians mostly use debit cards as an ATM card. In 2012, $330 billion cash
was withdrawn from ATMs using debit cards.29
In India four types of debit cards
are issued by banks like VISA, VISA Electron, Master card and Maestro.
27www.marketplace.org.topics/businss
28en.wikipedia.org/wiki/debit-card
29www.livemint.com
108
2.2.2TYPES OF DEBIT CARD SYSTEM
There are currently three ways that debit card transactions are processed.
Online debit also known as PIN debit, offline debit also known as signature debit
and the Electronic purse card system.30
It should be noted that one physical card
can include the functions of an online debit card, an offline debit card and an
electronic purse card.
2.2.2.1Online Debit System: Online debit system requires electronic authorization
for every transaction and the debits are replaced in the user’s account immediately.
The transaction may be additionally secured with the personal identification
number (PIN) authentication system and some online cards require such
authentication for every transaction, essentially becoming enhanced automatic
teller machine cards. One important thing in using online debit cards is the
necessity of an electronic authentication device at the POS and sometimes also a
separate PIN pad to enter the PIN.
2.2.2.2 Offline Debit System: Offline debit cards are used at the POS like a credit
card with payer’s signature. This type of debit card may be subject to a daily limit,
and or a maximum limit equal to the current account balance from which it draws
funds. Transactions conducted with offline debit cards require two to three days to
be reflected on user’s account balance.
30asad.debitcards.blogspot.com
109
2.2.2.3 Electronic Purse Card System: Smart card based electronic purse
systems in which value is stored on the card chip, not in an externally recorded
account. So that machines accepting the card need no network connectivity are in
use throughout Europe since the mid-1990s, most notably in German (Gold Karte),
Austria (Quick), the Netherland (Chipknip), Belgium (Proton) and Switzerland
(CASH). In Austria and Germany, all current bank cards now include electronic
purse.
2.2.3 DEBIT CARD OPERATION CYCLE
To transact through debit card is easy and authentic way in which the card
is swiped through the terminal with magnetic code reader. It records customer’s
bank account number. Customer has to enter the PIN number in the terminal in
order to perform the transaction through which information is travelled to
electronic network linked to the merchant bank with the bank that issued debit card
to the customer. If the transaction is approved then the customer account is duly
debited and merchant account is credited with that amount. The whole process is
performed instantaneously in spite the involvement of large number of parties.
Debit cards are considered effective where customers value it as convenience and
merchants see it as lowering cost or enhancing sale.
2.2.4 BENEFITS OF DEBIT CARD
Debit cards offer the following benefits.
� They help people to be financially disciplined, since one can’t splurge with
the limited amount of funds deposited for the card.
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� A person with poor credit can obtain a debit card without too much trouble.
� Debit cards can be used to make online purchase and payments.
� They provide freedom from carrying cash and cheques while travelling
thereby offering more safety.
� Debit cards do not charge high interest rates or fees on card transactions.
2.2.5 DISADVANTAGES OF DEBIT CARD
� The threat posed by frauds is the major constrain.
� One can only use as many fund as he has in account. Therefore, in case of
an emergencies, where credit is urgently needed beyond account balance, a
debit card will not be enough to meet one’s need.
2.2.6TYPES OF DEBIT CARD
Debit cards are available to fit a variety of financial needs and life styles.
The debit card market is expanding and the companies are trying to fulfill the
growing demand. For the purpose, different types of debit cards with various
features are offered by the debit card companies.
2.2.6.1PIN – only card: PIN – only cards are linked to bank account. It is used
to get cash from ATM, make deposits, transfer funds between accounts, buy
goods and services from retailers, and pay bills online. When using a PIN
enabled debit card one should enter the PIN at the ATM or at retail location. It
verifies the cardholders’ identity and increase the security of the transaction.
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2.2.6.2Dual – use Card: Dual – use Debit cards are both signature and PIN
enabled and tied directly to card holder’s bank account. Card holder can choose
to authorize a purchase by entering PIN or by signing a receipt.
2.2.6.3 Prepaid Cards: Prepaid cards are not associated with any specific
account but instead access to funds deposited directly on the card. When a
purchase is made with a prepaid card, funds are taken directly from the actual
balance on the card. One can spend only the amount of money stored on the
card.
Examples of prepaid card include:
� Gift cards from a bookstore, department more or online retailer
� Family or personal spending cards
� Travel cards
� Flexible spending or health saving cards.
� Payroll cards from an employer.
2.2.6.4 EBT Card: Electronic Benefit Transfer (EBT) cards are provided by many
State or Government agencies to people who qualify for cash payment, food
stamps or other benefits. Depending on the type of government programme an
EBT card may be used to make purchase at participating retailers or to withdraw
cash from an ATM.
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2.2.7GROWTH OF DEBIT CARD
Indian debit card market registered significant growth. Changing lifestyle,
the need for more sophisticated products, the growth of online shopping and
increasing levels of per capita income supported the growth of this market. With
competitive pressured on both the prepaid and debit cards market, banks and
issuers are developing marketing and pricing strategies with the aim of attracting
larger customer base. Offers such as cash back, discounts for retail outlets, buy
one – get one free offer, reward paints, increasing daily limits for cash
withdrawals, and insurance coverage are some of the most commons strategies that
banks are providing to debit card customers.
113
Table 2.3
BANK GROUP – WISE OUTSTANDING NUMBER OF DEBIT CARDS ISSUED BY SCHEDULED
COMMERCIAL BANKS
(Number in Millions)
Bank
group/Year
2008-09 2009-10 2010-11 2011-12 2012-13
Number % of
total
Number % of
total
Number % of
total
Number % of
total
Number % of
total
Public Sector
Bank
91.7 66.72 129.69 71.26 170.34 74.76 214.6 76.86 260.6 78.68
Nationalized
Bank
40.71 29.62 58.82 32.32 80.27 35.23 97.7 35.14 118.6 35.81
SBI Group 50.99 37.10 70.87 38.94 90.90 39.53 112.0 40.23 136.4 41.18
Private Sector
Bank
41.34 30.08 47.85 26.29 53.58 23.52 60.0 21.6 67.3 20.32
Old Private
Sector Bank
7.09 5.16 9.81 5.39 12.44 5.46 13.9 5.00 15.4 4.65
New Private
Sector Bank
34.25 24.92 38.04 20.90 41.14 18.06 46.0 16.52 51.9 15.67
Foreign Bank 4.39 3.99 4.43 2.43 3.92 1.72 3.8 1.36 3.3 0.99
All 137.43 100 181.97 100 227.84 100 278.4 100 331.2 100
Source: compiled from RBI report on trend and progress of banking in India, various issues
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The above table shows bank group wise outstanding number of debit
cards issued by scheduled commercial banks as at March ending. Public sector
banks have been the front runners is issuing debit cards. In 2012-13, public
sector banks have highest number of debit cards issued (260.6) which is 78.68
percent of total debit cards issued by the Industry. Nationalized banks (35.81)
and SBI Group (41.18) have highest percentage of cards issued as compared to
private sector banks. The share of new private sector bank is higher as
compared to old private sector banks. Foreign banks have 0.99 percent of total
debit cards issued.
Table 2.4
Growth of outstanding debit cards in Indian banking
(Number in Millions)
Year Number Net increase Growth (%)
2007-08 102.44 - -
2008-09 137.43 34.99 34.16
2009-10 181.97 44.54 32.41
2010-11 227.84 45.87 25.21
2011-12 278.4 51.56 22.63
2012-13 331.2 52.8 19.00
Average Score 26.68
Source: compiled from RBI repot on trend and progress of banking in India, various issues
The above table reveals the growth of outstanding debit card in
India for the past five years and the average score at the rate of 26.68 percent.
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From the above table one can observe that the number of outstanding debit card
is growing year by year but the growth rate is not showing upward trend. The
highest growth rate is reported on 2008-09 but in FY 2011-12, the rate of
growth came down to 22.63 percent and in FY 2012-13, 19 percent which is
below the average growth score of 26.68 percent.
Comparing the credit card and debit card usage in India, it is clear
that Indians use a credit card for an average payment amount of about
Rs.55000 in a year which is nearly 30 times the money spent through Debit
Card. However, the number of debit cards in the country is more than 15 times
than that of credit card shows an analysis of data available with RBI. As on
Dec 2012, as many as 31.44 crore bank customers have been issued debit cards
and the number is growing at a compound annual rate of 18 percent, whereas
the annual growth of credit card is just six to seven percent. With focus on
more and more bank inclusion, the pace of growth is only expected to grow.
This would take the number of bank debit cards to well over 54 crore in the
next three financial years.31
Thus, debit card is taking the market share from
cash and cheques and also moving in to a dominant position in traditional
credit card market.
31www.assocham.org/prels
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2.2.8 RBI INITIATIVES
As a step towards enhancing the customer convenience in using the
debit card, RBI has decided to permit cash withdrawal at point of sale
terminals. To start with, this is available for all debit cards issued in India up to
Rs.1000 per day.32
The debit cards are largely being used for cash withdrawal and not
much at the merchant stores, given the conservative nature of this class of
customers. Cash withdrawal using debit card by cardholders were around
Rs.1,46,125 crores in Dec 2012 whereas the point of sale usage was limited to
just about Rs.6909 crores monthly sales. RBI found it was necessary to
encourage the use of debit cards. Especially by way of lower merchant discount
rates, which would encourage all categories and types of merchants to deploy
the card acceptance infrastructure and also facilitate acceptance of small value
transaction.
Under the recently announced policy, the Merchant Discount Rate
(MDR) for usage of debit card should not exceed 0.75 percent of the
transaction value for transaction up to Rs.2000 and not exceed one percent for
transactions above Rs.2000.33
32www.thehindubusinessline.com
33www.nextbigwhat.com/rbi/slashes
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An increase in the number of cases of fraud because of stolen card
data through card skimming and counter feiting had prompted RBI to form a
panel to look in to securing card based transactions through additional layers of
authentication, such as PINs and biometrics in March 2011. As per the
notification of RBI, all card present infrastructures have to be enabled for both
EMV chip and PIN and Aadhaar (Biometric Verification) acceptance.34
EMV
(Europay – Master Card Visa) chip and PIN authentication involves card
information stored in a chip that is accessible through a PIN and which replaces
a cardholders signature, as per the RBI guidelines issued in September 2011.
RBI had made it mandatory to implement PIN punching at point of
sale and merchant outlets. Under this system, first merchant will swipe the
cards at a PIN enable POS terminal and punch in the transaction amount. That
will be followed by customer’s entering their PINs to complete the
transaction.35
To increase the safety of transaction done online RBI made it
mandatory that all transactions to Indian Merchants require to be authorized via
VbV/3DSC. This means, to shop online on Indian Store, one need to get his
card registered on VbV/3DSC. One needs to register his visa and master card
debit card online in his bank’s portal and create a password for it. For visa this
34www.businessinsider.in
35businesstoday.indiatoday.in
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password is called verified by visa (VBV) for master card, this password is
called ‘3D secure code’.
In order to check frauds, the RBI has asked banks to impose
monetary limit for international transactions on credit and debit cards and
refrain from issuing cards with global access unless specifically sought by the
customer. The RBI said that a monetary limit of USD 500 be imposed by
issuing bank on all global cards which has not been used in the past. All the
active magnetic stripe international cards issued by banks should have
threshold limit for international usage. The threshold should be determined by
the banks based on the risk profile of the customer and accepted by the
customer.36
2.2.9 RUPAY DEBIT CARD
In order to support the RBI’s plan to move towards wider usage of
cards and electronification of pay the Rupay card is introduced by NPCI – the
card has been launched in March 2012.The Rupay card is meant to promote a
payment and settlement platform for card transactions at a low processing fee,
making it viable for smaller merchant establishments to accept card payment
for even low-value transactions.37
Rupay is pitched in direct competition with
plastic cards issued through visa and master card and it’s are 40 percent lower
compared with the latter’s.
36www.medianama.com
37 www.mpci.org.in/Rupay
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Rupay debit card will be accepted at more than 1, 00,000 ATMs
and 6 lakhs POS terminals in the country. At present around 22 banks use the
Rupay based system in the country – State Bank of India, Bank of India, Bank
of Baroda, Axis Bank, the rest 18 banks comprise of Regional Rural Banks and
Cooperative banks. The Rupay debit card is only for domestic transactions as
of now and it does not offer net banking services currently. Thus the Rupay
card has been launched to tap in to the tremendous growth opportunity of card
payment system and the use of the same as an alternative to move to the
consumers away from cash. Moreover, it helps in financial inclusion as many
co-operative banks and Regional Rural Banks are included in its network.
2.3 CREDIT CARD
Credit card is a small plastic card, which helps the owner of the card to
settle any payments without paying cash, draft or cheques. It is a card entitling
its holder to buy goods and services based on the holder’s promise to pay for
these goods and services. The issuer of the card grants a line of credit to the
consumer or the user from which the user can borrow money for payment to a
merchant or as a cash advance to the user.
2.3.1 HISTORY OF CREDIT CARD
The concept of using a card for purchases was described in 1887 by
Edward Bellamy in his utopian novel.38
The modern credit card was the
38 Edward Bellamy (1888) “Looking backward 2000-1887’ utopian novel, William
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successor of a variety of merchant credit schemes. It was first used in the
1920s, in the United States, specifically to sell fuel to growing number of
automobile owners. In 1938 several companies started to accept each other’s
cards. Western Union had begun issuing charge cards to its frequent customers,
in 1921. The charge-plate was an early predecessor to the credit card and used
during 1930s and late 1940s.39
The concept of customers paying different merchant using the same card
was invented in 1950 by Diners club to consolidate multiple cards. The Dinner
club produced the first general purpose charge card and required the entire bill
to be paid with each statement. That was followed by Carte Blanche and in
1958 by American Express which created a World Wide Credit card network.
In September 1958, Bank of America launched the Bank Americard in
California. Bank Americard became the first successful recognizable modern
credit card and with its overseas affiliates, eventually evolved in to the visa
system. In 1966, the ancestor of Master card established Master charge to
compete with Bank Americard.
In 1966 Barclaycard in the UK launched the first credit card outside the
U.S. Credit card became an effective way for those who were travelling around
the country to move their credit to places where they could not directly use
39 www.creditcards.com/credit card news
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their banking facilities. Although, having reached very high adoption levels in
the U.S, Canda and the U.K, many cultures were much more cash oriented in
the latter half of the twentieth century or had developed alternative for of cash-
less payments. In these places, the take-up of credit cards was initially much
slower. It took until the 1990 to reach anything like percentage market –
penetration levels achieved in US, Canada, or the UK.40
The value of the card to the issuer is often related to the customer’s
usage of the card, or to the customer’s financial worth. This had led to the rise
of co-brand and Affinity cards where the card design is related to the affinity
leading to higher card usage.
As of 2007, the United Kingdom was one of the world’s most credit-
card intensive countries, with 2.4 credit cards per consumer. As of 2006, the
United States probably had one of the worlds if not the top ratio of credit cards
per capita, with 984 million bank-issued visa and master card credit card and
debit card accounts alone for an adult population of around 220 million
people.41
Credit cards are relatively new to India. Andhra Bank and Central Bank
of India introduced credit cards in 1981. As of now there are about more than
dozen major banks in Indian and foreign which have entered this line of
40 www.mastercards.com
41 www.livemint.com
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business, besides some non-banking institutions. Since the plastic money has
become as good as legal tender more people are using them in their day-to-day
activities. The attitude of people towards credit cards has changed.
2.3.2CREDIT CARD TYPES
Before we apply for a credit card it is always better to know what type
of credit card is best suited to our profile. Catering to different types of
consumer needs, credit card companies issue several types of credit cards.
2.3.2.1General Purpose Credit Card: It can be used to pay for just about
anything, anywhere from clothes at department stores to meals at restaurants as
well as to get cash advances. American Express, Visa, Master card and
Discover cards are examples. An advantage of using this type of card is that it
combines many different types of expenses in a single bill, making payment
easier.
2.3.2.2 Single Or Limited Purpose Credit Cards: It can be used only in a
specific store or group of stores or for a specific purpose. Some people prefer
to have separate credit account such as a gasonline credit card a credit card at a
chain, or specialty stores, plus other cards.
2.3.2.3 Premium Cards: Such as Platinum or Gold cards are credit cards that
offer additional benefits such as travel upgrades, special insurance exclusive
seating’s for concerts. Generally premium cards require a substantial income
and an excellent credit history offer a higher credit limit and may charge higher
fees.
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2.3.2.4 Affinity Credit Cards: These are associated with specific
organizations and offered to people affiliated with these organizations.
Generally and affinity credit card is co-sponsored by the organization it is
associated with, and the organization receives a percentage of the sales or
profits generated by the card. Rates, fees and benefits of affinity cards vary
widely.
2.3.2.5 Co-Branded Credit Cards: These are sponsored by two companies
and have benefits and rewards designed specifically for their joint customers.
2.3.2.6 Secured Cards: These are credit cards guaranteed by a bank account or
deposit made by the applicant. The credit limit is based on the amount of
deposit and may be the same amount or larger. Secured credit cards are useful
to establish or improve a credit record particularly, if someone has never had
credit or have poor credit history.
2.3.3FEATURES OF CARD
The features of modern credit cards such as owner identification, credit limit
for its card holder and floor limit for its merchant establishment, convenience
and safety to add value of cards, wider usage or popularity all over the world
and dependence on technology to keep operation cost to the minimum, have
been a runway success for credit cards.42
42. Report of the committee on the technology issues relating to payment system, cheque, clearing and
security settlement in the banking industry, RBI, Mumbai, 1994, page.75
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Along with convenient, accessible credit, credit cards offer consumers
an easy way to track expenses, which is necessary for both monitoring personal
expenditure and the tracking of work-related expenses for taxation and
reimbursement. Credit cards are accepted worldwide, and are available with a
large variety of credit limits, repayment arrangement, and other perks such as
reward schemes in which points earned by purchasing goods with the card can
be redeemed for further goods and services or credit card cash back. Some
countries, such as the United States, the United Kingdom and France, limit the
amount for which a consumer can be held liable due to fraudulent transactions
as a result of the consumers’ credit card being lost or stolen. A credit card is
part of a system of payment named after the small plastic card issued to the
users of the system. The credit card is different from a charge card, which
requires the balance to be paid in full each month. In contrast, credit cards
allow the consumers to ‘revolve’ their balance, at the cost of having interest
charged. Most credit cards are issued by local banks or credit unions and
having the same shape & size, as specified by the ISO 7810 standard.43
2.3.4CREDIT CARD TRANSACTION
The flow of information and money between parties in the credit cards
always through the card association is known as interchange, and it consists of
the following steps.
43 http://en.wikipedia.org/wiks/creditcard
125
2.3.4.1 Authorization: The cardholder pays for the purchase and the merchant
submits the transaction to the acquirer. The acquirer verifies the credit card
number, the transaction type and the amount with the card issuing bank and
reserve that amount of the cardholder’s credit limit for the merchant. An
authorization will generate an approval code, which the merchant stores with
the transaction.
2.3.4.2 Batching: Authorized transactions are stored in batches, which are sent
to the acquirer. Batches are typically submitted once per day at the end of the
business day. If a transaction is not submitted in the batch, the authorization
will stay valid for a period determined by the issuer, after which the held
amount will be returned back to the cardholder’s available credit.
2.3.4.3 Cleaning and Settlement: The acquirer sends the batch transactions
through the credit card association, which debit the issuers for payment and
credits the acquirer. Essentially, the issuer pays the acquirer for the transaction.
2.3.4.4 Funding: Once the acquirer has been paid, the acquirer pays the
merchant. The merchant receives the amount totaling the funds in the batch
minus the “discount rate”, which is the fee the merchant pays the acquirer for
processing the transactions
2.3.4.5 Charge Backs: A charge back is an event in which money in a
merchant account is held due to a dispute relating to the transaction. Charge
backs are typically initiated by the cardholder. In the event of a charge back,
the issuer returns the transaction to the acquirer for resolution. The acquirer
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then forward the charge back to the merchant, who must either accept the
charge back or contest it.
2.3.5 CREDIT CARD SERVICES IN INDIA
Indian credit card market is growing upwards due to the global business
environment. This is not only new but also benefit to the existing and new
cardholders by giving the important innovative services offered under the
following heads.
2.3.5.1 Merchant Establishment Services:
Wider acceptance of credit cards, discount facility offered to the
customers and quick processing of transactions for the credit card holder is the
important services made by the merchant establishment at their POS. The
benefits range from lifetime free card, Global emergency assistance service,
discount, utility payments, travel discount & lot more.
Bank gold cards are welcomed at all merchant establishments displaying
the VISA logo over 1,10,000 and master logo over 77,000 establishments
across India.
2.3.5.2 Insurance Services:
Once own a credit card, there are some insurance benefits available to us
who come along with the newly – issued credit card, we will find an insurance
company that is offering various kinds of services. The best part is that the
insurance company pays for these covers by purchasing group insurance
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schemes. The insurance benefits include the following (i) Credit Insurance, (ii)
Personal accident insurance (iii) Lost baggage insurance (iv) Purchase
protection (v) Health Insurance (vi) Protection plus (vii) Credit Shield.
2.3.5.3 Convenience Services:
The following are the important convenience services offered to the card
holders.
2.3.5.3.1 Auto Debit Facility: With this facility cardholder can pay that credit
card dues directly from his account but need to authorize the bank to claim the
amount directly from their bank account every month and bank will credit his
card account on the payment due date.
2.3.5.3.2 Payment option:
The cardholder of the respective banks may deposit cash towards their
credit card payment at any of their bank even pay over the phone by calling at
any of their 24 hour customer care numbers. Presently, payment through ATM
is accessible for some banks. Cardholders can make online payment from his
saving account to credit card account using bill pay facility.
2.3.5.3.3 E-Mail Statement: Statement online is a very simple, powerful and
convenient way to access credit card statement details instantly without any
postal delays.
2.3.5.3.4 Mobile Alters: Mobile alters from bank provide us with information
about bank credit card even when the cardholders are on the move.
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2.3.5.3.5 Transact Online: Cardholders can access information on credit card
transactions, such as payment status, request for a duplicate PIN, change of
address, dial a draft, auto debit, request for ‘Add on card, access and redeem
online from the Reward point, subscribe to statement by email & Subscribe to
mobile alert more conveniently.
2.3.5.4 Value Added Services:
The following are the important facilities give more value for the card
and its cardholders such as.
2.3.5.4.1 Utility Bill Payment / Bill Pay Service: Utility bill payment/bill pay
service is simple convenient and secure way to pay utility bill such as
electricity, telephone, insurance and other payments by using credit cards. The
bill pay service is a simple service through which we can setup a standing
instruction on Bank Credit card for payment of their utility bills.
2.3.5.4.2 Balance Transfer Facility: Bank’s Balance Transfer facility
gives cardholders the option of transferring outstanding balances from one
bank’s card to any other bank’s credit card.
2.3.5.4.3 Cash Advance Facility: Cash advances are convenient and easiest
facility to draw cash for the cardholder’s urgency. Banks in India charge a
transaction fee as well as service fee/interest charge on cash advances. The
limit of cash advance is 30 percent to 40 percent of total credit limit.
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2.3.5.4.4 Dial – A Draft Facility: Cardholder can order a draft from home or
office conveniently by calling their bank 24 hours customer care. The draft will
be delivered to the credit cardholders mailing address. The amount of the draft
will be billed in the bank’s credit card statement.
2.3.5.4.5 Cash – In – Personal Loan: Cash-in is a personal loan on credit
card. The loan can be against the credit/cash limit or over and above the credit
limit.
2.3.5.4.6 Express Reward Programme: Under the new express reward
programme, credit cardholders spend more on this card greater are the rewards,
for example ICICI bank credit cards rewards programme is an exclusive
initiative aim at rewarding customer relationship with ICICI Bank.
2.3.5.6 Benefit Services:
The following credit card gives more benefit to the cardholders based on
the variety of service offered by the issuers to the cardholders such as:
2.3.5.6.1 Add – On Card: Credit card holders can freely present a maximum
of two add-on cards to their wife, sisters, brothers, parents or children above 18
years of age. The unique feature of an add-on card is the preset limit, which
allows the customer to empower their family with the flexibility and
convenience of a card that allows cardholders to control spending.
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2.3.5.6.2 Monthly Self – Set/ Pre-Set Spending Limit: The cardholder can
limit their monthly spending. Any transactions over the specified ‘Special
Limit’ will be declined.
2.3.5.6.3 Temporary Credit Limit Enhancement: There will be times when
cardholders feel the need for an increase in his credit limit. This enables
customers to make increased purchases on their card.
2.3.5.6.4 Permanent Credit Limit Enhancement: There will be times when
card holder often feels the need for an increase in their credit limit. This facility
enables them to make increased purchases on card.
2.3.5.6.5 Limited Lost Card Liability: Customers are covered from any
unauthorized transactions on the card after the customer’s report of loss. But
customers will have to bear the charges of the transactions made before the
report of the loss.
2.3.5.6.6 Revolving Credit Facility: Revolving credit is a type of credit that
does not have a fixed amount of payments. Credit card allows the consumers to
revolve their balances at the cost of having interest charged. Cardholders
receiving the bill need not pay the entire amount. They may pay only the
minimum amount and the balance is carried to the subsequent statement.
2.3.5.6.7 Interest Free Credit Period: The payment due date on the credit
card is 18 days from the statement date. There is an interest free credit period
ranges between 18 and 48 days. The interest free credit periods varies from one
bank card to another bank card.
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2.3.5.7 General Services: The following are the important general services
which gain the more advantages to cardholder convenience for safety. They are
separate card for the house wife, Automatic renewal of credit cards, No fee for
the registration, renewal and annual, online marketing services, photo card
options and signature digitally imprinted.
Table 2.5
2.3.6. GROWTH OF CREDIT CARDS IN INDIAN MARKET
Growth of Outstanding Credit Card at the end of March (in millions)
Year Number Net
Increase/Decrease
Growth
2007-08 27.55 - -
2008-09 24.70 -2.85 -10.3
2009-10 18.33 -6.37 -25.79
2010-11 18.04 -0.29 -1.58
2011-12 17.7 -0.34 -1.9
2012-13 19.5 1.8 10.17
Source: compiled from RBI report on trend and progress banking in India, various issues.
The above table shows the outstanding number of credit cards issued by
banks. The number of credit cards issued has declined from 27.55 million in
2007-06 to 24.70 in 2008-09. The credit cards showed a Negative growth up to
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2011-12. But in the year 2012-13 the outstanding number of credit cards has
increased to 10.17 percent over the previous year.
The negative impact of the economic slowdown has clearly shown on
the credit cards segment. The study of Master card’s India cards council
pointed out that insufficient inputs were used to check the credit worthiness of
applications and absence of annual fees encouraged customers to hold cards
from multiple banks, resulting in a high level of inactive cards. Hence, none of
the issuers have been aggressively marketing cards during 2008-2009. Credit
card norms have been tightened. Issuers have raised the minimum income
requirements across the board and also the cut-off scores for issuance on these
cards.
2.3.7 AVERAGE CREDIT CARD SPENDING
The average monthly spend per card has jumped 42 percent to Rs.6322
in 2013 from 4,462 two years ago. Banks attribute the rise primarily to a
payment innovation termed EMI at POS. Total spending on credit cards
increased 57 percent to Rs.12380 crore in May 2013 from Rs.7880 crore in
May 2011. Part of this is due to the card industry returning to growth after four
years and the number of credit cards rising to 1.95 crores from 1.76 crore.44
It
is consumerism that is driving the size of transactions with the introduction of
EMI at POS.
44 times of India.indiatimes.com/business
133
In recent years, several new entities have started accepting card
payments. These include insurance companies and Government utilities. But
the biggest driver for increase in size of transactions has been the zero-interest
EMI option. Another driver is that banks are getting innovative with their
reward programs.
Card companies are today in a much better position to extend credit than
they were five years ago. First, there has been a dramatic fall in willful defaults
as customers realize that a bad credit record with a credit information bureau is
worse than saving a few thousand rupees by refusing to pay. Secondly, banks
have learned their lessons after 2007 when defaults in personal loans peaked;
instead, they now issue cards largely to their own customer base.
2.3.8 CREDIT CARD SECURITY
Credit card security relies on the physical security of the plastic card as
well as the privacy of the credit card number. Credit card fraud is a major white
collar crime that has been around practice for many decades. Most internet
fraud is done through the use of stolen credit card information which is
obtained in many ways, the simplest being copying information from retailers,
either online or offline.
There has been a rise in case of credit cards being used fraudulently on
the internet. According to the cyber-crime statistics, a total of 20 cases of credit
card fraud have been reported during March to August 2011. Statistics from the
Internet
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crime compliant centre show that there has been a significant upward trend in
fraud reporting between the Agency’s inception in 2000 and its most recent
figures in 2010.45
The Central Bank has done its best to ensure that transactions in India
are completely secure. It had earlier told banks to have an additional PIN based
authentication for credit card numbers. It has also told acquiring banks to
ensure that all acceptance devices can read EMV cards. Bankers say that there
has been a sharp drop in fraudulent usage of cards in India. However, the
problem is in international transactions. The RBI in its recent report indicated
that it would like to bring in a system under which a credit card holder is not
liable for transactions done fraudulently using his card46
2.4 INTERNET BANKING
Internet baking that is also known as online banking is an outgrowth of
PC banking. It is one of the emerging services. Internet banking can be defined
as a facility provided by banking and financial institutions that enables the user
to execute bank related transactions through internet.
Net Banker defines a true internet bank as one that provide account
balances and some transactional capabilities to retail customers over the World
Wide Web. Internet banks are also known as virtual, cyber, net, interactive or
web banks.
45www.businessweek.com/credit card-data-security
46www.thehindubusinessline.com
135
Internet banking refers to the deployment over the Internet of retail and
wholesale banking services. It involves individual and corporate clients and
includes bank transfers, payments and settlements, documentary collections
and credits, corporate and household lending, card business and some others
(UNCTAD, 2002)47
Online banking allows people access all of their account through a
secure bank – created website. In internet banking system the bank has a
centralized database that is web enabled. All the services that the bank has
permitted on the internet are displayed in menu. Any service can be selected
and further interaction is dictated by the nature of service.
2.4.1 EVOLUTION OF INTERNET BANKING
The precursor for the modern home online banking services were the
distance banking services over electronic media from the early 1980s. The term
online became popular in the late ‘80s. The concept of internet banking has
been simultaneously evolving with the development of the World Wide Web.
Programmers working on banking database came up with ideas for
online banking transactions. The creative process of development of these
services was probably sparked off after many companies started the concept of
online shopping. Online services started in New York in 1981, when four of the
city’s major banks offered home banking services using the videotext system.
47United Nations Conference on Trade and Development (UNCTAD) (2002) E-commerce and
development report 2002 (Newyork & Geneva, United Nation)
136
Because of the commercial failure of videotext these banking services never
become popular. In 1983, the Nottingham Building Society launched the first
Internet Banking services in United Kingdom. This service formed the basis for
most of the Internet banking facilities that followed. This facility was not very
well-developed and restricted the number of transactions and functions that
account holders could execute. The facility introduced by Nottingham Building
Society is said to have been derived from a system known as Prestel that is
deployed by the postal service department of United Kingdom.48
The first online banking service in United States was introduced in
October 1994. The service was offered by Stemford Federal Credit Union,
which is a financial institution. Deutsch Bank launched the very first internet
banking project in Latin America in 1996.Internet banking is not limited to a
physical site. Some internet banks exist without physical branches for example
Tele bank (Arlington, Virginia) and Bank net (UK). Security First Net Bank
(SFNB) which was formed in 1996 in the US claims to be first Internet-only
bank in the world. In some cases, web banks are not restricted to conducting
transactions within national borders and have the ability to make transactions
involving large amount of assets instantaneously.49
In India, ICICI bank was the first bank to initiate Internet Banking
Revolution as early as 1997 under the brand name ‘Infinity’. Other private
sector banks like Citi Bank, InduSind bank and HDFC bank started offering
48 http://www.buzzle.com/articles/history-of-internet-banking.
49 en.wikipedia/org/wiki/online-banking
137
internet services in 1999. The period between 1996 and 1998 is marked as the
adoption phase. The usage of internet banking services increased only in 1999,
owing to lower ISP online charges, increased PC penetration and a tech-
friendly atmosphere.50
State Bank of India launched its services in July 2001.
Other Public Sector banks like Bank of Baroda, Allahabad Bank, Syndicate
Bank and Bank of India also rolled its services during the same time.
Internet banking services are offered in three levels, the first level is of a
bank’s informational website, wherein only queries are handled; the second
level includes simple transactional websites under which no fund based
transactions are allowed to be conducted. Internet banking in India has reached
level three, offering Fully Transactional websites, which allows for fund
transfers and various value added services.
Internet Banking poses high risks. This has restrained the development
of internet banking in India. The guidelines governing internet banking
operations in India covers a number of technical, security and legal issues to be
addressed relating to Net banking. According to the earlier guidelines, all
internet banking services had to be denominated in local currency, but now,
even foreign exchange services, for the permitted transactions can be offered
through internet banking.
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Internet banking can be offered only by banks licensed and supervised
in India, having physical presence in India. Overseas branches of Indian banks
are allowed to undertake internet banking only after satisfying the host
supervisor in addition to the home supervisor.
Internet banking is gaining popularity and transactions through net
banking have been steadily increasing. Internet penetration is the main driving
force. The number of internet users has reached 205 million in October 2013 as
many as, 7 percent of account holders in the country are using the internet for
banking transactions.51
The primary drivers of internet banking in India include.
� Improve customer access.
� Facilitate the offering of more services.
� Increase customer loyalty.
� Attract new customers.
� Provide services offered by competitors
� Reduce customer attrition.
2.4.2 INTERNET BANKING SYSTEM
The Reserve Bank of India constituted a working group on internet
banking. The group divided the internet banking services in India in to three
types based on the levels of access granted. They are:
51 http://www.businessstandard.com / article/finance/account -holders-in-India.
139
2.4.2.1 Information only system: General purpose information like interest
rate, branch location, bank products and their features, loan and deposit
calculations are provided in the bank’s website. There exist facilities for
downloading various types of application forms. The communication is
normally done through e-mail. There is no interaction between the customer
and bank’s application system. No identification of the customer is done. In
this system, there is no possibility of any unauthorized person getting in to
production systems of the bank through internet.
2.4.2.2Electronic Information Transfer System: The system provides
customer specific information in the form of account balance, transaction
details and statement of accounts. The information is still largely of the ‘read
only’ format. Identification and authentication of the customer is through
password. The information is fetched from the bank’s application system either
in batch mode or off-line. The application systems cannot be directly accessed
through the internet.
2.4.2.3Fully Electronic Transactional System: This system allows bi-
directional capabilities. Transactions can be submitted by the customer for
online update. This system requires high degree of security and control. In this
environment, web server and application systems are linked over secure
infrastructure. It comprises technology covering computerization, networking
and security, inter-bank payment gateway and legal infrastructure.
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2.4.3 SERVICES OFFERED THROUGH INTERNET BANKING
The customers would conduct a variety of transactions through internet
banking facility which includes, account information, fund transfer, bill
payment, cheque book request, credit card payment etc.
2.4.3.1Fund Transfer: One can transfer any amount from his account to
another of the same or any other bank. Once the customer login to his/her
account, he need to mention the payees’ account number, bank and branch. The
transfer will take place in a day or so. ICICI bank says that online bill payment
service and fund transfer facility have been their most popular online services.
2.4.3.2 Bill Payment Service: It facilitates payment of electricity and
telephone bills, mobile phone, credit card and insurance premium bills as each
bank has tie-ups with various utility companies, Service providers and
insurance companies, across the country. To pay bills, the customer needs to
complete a simple one time registration for each biller. The customer can also
set up standing instructions online to pay recurring bills automatically.
2.4.3.3. Credit Card Customer Service: With internet banking, customers can
not only pay their credit card bills online but also get a loan on their card. He
can report lost card online.
2.4.3.4 Railway Pass: Indian Railways has tied-up with banks and the net
banking customer can make railway pass for local trains online. The pass will
be delivered to customers at his door step.
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2.4.3.5 Investing through Internet Banking: Net banking customers can
open fixed deposit online through fund transfer. Investors with inter linked
Demat account and bank account can easily trade in the stock market and
the account will be automatically debited from their respective banks
accounts and the shares will be credited in their Demat account. Moreover,
some banks even give the facility to purchase funds directly from the online
banking system.
2.4.3.6 Recharge Prepaid Phone: One can top-up his/her prepaid mobile
cards by logging in to internet banking. By just selecting the operator’s
name, mobile number and the amount of recharge, the phone is again back
in action within few minutes.
2.4.3.7 Shopping: With a range of all kinds of products, net banking
customers can shop online and make payment conveniently. He can also
buy railway and air tickets through internet banking.
2.4.4 BENEFITS OF NET BANKING
The most important factors encouraging consumers to use online
banking are lower fees followed by reducing paper work and human error,
which subsequently minimize disputes.
Internet banking offers many benefits to banks and their customers. The
main benefits to banks are cost saving, reaching new segments of
population, efficiency, enhancement of banks reputation and better
customer service and enhancement. The internet increases the power of the
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customer to make price comparison, as a consequence this pushes prices
and margins downward. The customer can visit the websites and can
compare the services offered by a bank with that of another. The benefits of
Internet have caused the financial institution to view internet as more than a
marketing communications tool and to begin successfully employ the
internet as a new channel for their services.
2.4.4.1BENEFITS TO BANK
2.4.4.1.1 Cost efficiency: Banks can deliver banking services on the net at
transaction cost far than traditional brick and mortar branches.
2.4.4.1.2 Geographical Reach: Internet banking allows expanded customer
contact through increased reach. In fact some banks are using the internet as
an alternative delivery channel to reach existing customer and attract new
customer.
2.4.4.1.3 Relationship building and Branding: Internet banking
technology and products provide a means for banks to develop and maintain
an ongoing relationship with their customer by offering easy to access to a
broad array of products and services. This helps to build customer loyalty,
cross-sell and enhance business.
2.4.4.1.4 Improve customer service: Internet banking increases
competition within the banking system and also from the non-bank financial
institution. The competitive pressure help banks to introduce new array of
service and improve customer service.
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2.4.4.2 BENEFITS TO CUSTOMERS
Benefits of internet banking to customers may be summarized as:
2.4.4.2.1 Convenience: Unlike corner bank, online banking sites never close,
they are available 24 hours, a day, seven days a week and they are only a
mouse click away.
2.4.4.2.2Cost: According to industry exports, a bank spends an average of
Rs.40 for each transaction conducted at a branch. If a customer uses the ATM
facility, the cost drops to Rs.18.20 per transaction, but it is still much higher
than the cost involved in online banking. In order to promote net banking the
financial institutions offer certain services for free or charge a nominal amount.
2.4.4.2.3 Transaction speed: Online bank sites generally execute and confirm
transactions at or quicker than ATM processing speeds
2.4.4.2.4 Efficiency: One can access and manage all of his bank accounts even
securities from one secure site.
2.4.4.2.5 Effectiveness: Many online banking sites now offer sophisticated
tools, including account aggregation, stock quotes, rate alerts and portfolio
managing programs to help customers to manage all of his assets more
effectively.
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2.4.5 RISK ASSOCIATED WITH INTERNET BANKING52
A major driving force behind the rapid spread of Internet banking all
over the world is its acceptance as an extremely cost effective delivery channel
of banking services, as compared to other existing channels. However, internet
is not an unmixed blessing to the banking sector. Along with reduction in cost
of transactions, it has also brought about new orientation to risks and even new
forms of risks to which banks conducting internet banking expose themselves.
2.4.5.1Operational Risk: Operational risk, also referred to as transactional
risk is the most common form of risk associated with internet banking. It takes
the form of inaccurate processing of transactions, non-enforceability of
contracts, compromises in data integrity, data privacy and confidentiality,
unauthorized access or intrusion to banks systems and transactions etc. Such
risk can arise out of weakness in design, implementation and monitoring of
banks information system.
2.4.5.2Security Risk: Security risk arises on account of unauthorized access to
a bank’s critical information stores like accounting system, risk management
system, portfolio management system etc. A breach of security could result in
direct financial loss to the bank. For example, hackers operating via internet
could access, retrieve and use confidential customer information and also can
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implant virus. This may result in loss of data, theft of or tampering with
customer information, disabling of a significant portion of banks internal
computer system thus defying service etc., Other related risks are loss of
reputation, infringing customer’s privacy and its legal implications etc.
2.4.5.3 System architecture and design risk: Appropriate system architecture
and control is an important factor in managing various kinds of operational and
security risks. Banks face the risk of wrong choice of technology, improper
system design and inadequate control processes. Choice of appropriate
technology is a potential risk banks face. Technology which is out dated not
scalable or not proven could lead the bank in investment loss, a vulnerable
system and inefficient service with attendant operational and security risks and
also risk of loss of business.
2.4.5.4Reputational Risk: Reputational risk is the risk of getting significant
negative public opinion, which may result in critical loss of funding or
customers. It may be due to banks’ own action or due to third party action. The
main reason for this risk may be system or product not working to the
expectations of the customers, significant system deficiencies, significant
security breach, inadequate information to customers about product use and
problem resolution procedures, significant problem with communication
network that impair customers’ access to their funds and accounts.
2.4.5.5 Legal Risk: Legal risk arises from violation of or non-conformance
with laws, rules, regulations, or prescribed practices, or when the legal rights
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and obligations of parties to a transaction are not well established. Other
reasons for legal risks are uncertainty about the validity of some agreements
formed via electronic media and law regarding customer disclosures and
privacy protection.
2.4.5.6 Money laundering risk: As Internet banking transactions are
conducted remotely banks may find it difficult to apply traditional method of
detecting and preventing undesirable criminal activities. Thus banks expose
themselves to the money laundering risk. This may result in legal sanctions for
non-compliance with know – your customer laws.
2.4.5.7 Cross Border Risk: Internet banking is based on technology that, by its
very nature, is designed to extend the geographic reach of banks and
consumers. Such market expansion can extend beyond national borders. This
causes various risks. It includes legal and regulatory risks, as there may be
uncertainty about legal requirements in some countries and jurisdiction
ambiguities with respect to the responsibilities of different national authorities.
2.4.5.8 Strategic Risk: This risk it associated with the introduction of new
product or service. Degree of risk depend upon how well the institution has
addressed the various issues related to development of a business plan,
availability of sufficient resources to support this plan, credibility of vendor
and level of the technology used in comparison to the available technology etc.
2.4.5.9 Credit Risk: It is the risk that a counter party will not settle an
obligation for full value, either when due or at any time thereafter. Banks may
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not able properly evaluate the credit worthiness of the customer while
extending credit through remote banking procedure which could enhance the
credit risk.
2.4.5.10 Liquidity Risk: It arises out of a bank’s inability to meet its
obligations when they become due without incurring unacceptable losses, even
though bank may ultimately be able to meet its obligations. It is important for a
bank engaged in electronic money transfer activities that it ensures that funds
are adequate to cover redemption and settlement demands at any particular
time. Failure to do so will expose the bank to liquidity risk.
2.4.6 STATUS OF INTERNET USAGE AND INTERNET BANKING IN
INDIA
Internet banking in India began taking roots only from the early 2000s.
Experts believe it took eight to 10 years for online banking to take off and
mature. Slowly but steadily, the Indian customers are moving towards internet
banking. In a survey conducted by IAMAI in 2006, the estimated number of
internet users as of September, 2006 was 37 million and the number of active
users was pegged at around 25 million. The survey also estimates around
2.4million e-commerce users, which included internet banking users. As
estimated, 4.6 million Indian internet users availing internet banking services as
of 2007.53
53www.iamai.in/research.aspx
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In 2009, 63 million Indian are using the internet, representing a mere 5.2
percent of the country’s population. The survey of IAMAI for 2009-10 shows
some interesting results. It appears that a growing number of Internet users live
in India’s small and medium sized urban centres and not in metros as
commonly perceived. Of the total users in 2009, for instance, 34 percent lived
in the top 8 metros, 18 percent in large towns, 12 percent in towns and a
surprising 36 percent, the largest group in towns with below 5 lakh population.
According to a report by global management consultancy MCKinnsey&
Company (2011), as many as 7 percent of account holders in India, are using
the internet for banking transactions, while branch banking has fallen by a full
15 percentage points. Use of the internet for banking has seen a massive rise in
the year 2010-11, a seven fold jump since 2007 even as for the first time in the
past 13 years. It has suggested that banks could also implement technologies
like adaptive authentication etc., for fraud detection. In 2007, the number of
times Indian respondents visited the bank branch for doing transaction was 0.58
while the same in 2011 was 0.49. Branch usage has dropped by 27 percent on
an average across Asia, between 2007 and 201154.
According this survey of
IAMAI India leads growth in Asia in mobile and internet usage for banking.
India’s Internet subscriber base was 198.30 million at the end of June
2013, growing 20 percent over the previous quarter according to a report by the
54 internet impact in India, www.mckinsey.com/insights /automating
149
Telecom Regulatory Authority of India (TRAI). At the same growth rate,
India’s Internet population will be bigger than that of the US in the next few
quarters, which was about 260 million users.55
A recent research report by the Internet and Mobile Association of India
(IAMAI) estimates the number of Internet users at 205 million in October and
estimates it to swell to 213 million by the end of 2013. The number of Internet
users in rural India too is growing. India had 68 million rural users and the
number is expected to grow to 72 million by the year end. According to the
report, only 9 percent of the active internet users transact online.
Even though India is tipped to outgrow the US in total subscriber base,
penetration is still low at only 12.6 according to the World Bank’s World
Development Indicator. China’s internet user base is almost thrice than that of
India. As the standard of living in India improves, the Internet penetration too
is on the rise. It is predicted that the growth of internet users will be in excess
of 15 percent per year and continue to grow in the subsequent years.
Clearly, the desire to be connected and use technology is widespread.
The delivery of government services via internet, e-commerce, and ease of
access to information, popularity of social networking among youth, a higher
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presence of e-kiosks, mobile phone penetration and affordable plans from the
ISPs are all contributing factors to this phenomenon. However, with a very
low awareness level, online transaction is still in its infancy and there is a
pressing need to educate and inform the user of the benefits of the internet
services to drive the growth of internet usage for transactions.
2.4.7 SAFETY AND SECURITY OF INTERNET BANNKING
Internet banking systems have security features such as separate
transaction passwords, two factor authentication, multi-channel process for
registering payees, upper limit on transaction value and SMS alerts to
customers.
The benefits of net banking, not withstanding, a lot of people balk at
availing of this option because of the concerns about the security of online
transactions, especially in an age where phishing and online frauds is on the
rise.
Online banking threats claimed around 2900 victims from India in the
second quarter of 2013 as the world reeled under attack from inexpensive and
sophisticated malware tool kits used by cyber criminals, according to PC
security firm Trend Micro. Total online banking infections in Q2 were 1,
45,000 of which 2 percent were from India which comes to know about 1,900
online banking infections from India. Malware or malicious Software is used
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by attackers to disrupt computer operation, gather key data, or gain access to
private systems.56
RBI has announced measures to prevent online frauds. It has asked
banks to introduce additional factor of dynamic authentication. It has
recommended the one time password method for authentication and asked
banks to capture Internet Protocol (IP) address as an additional validation
check. For people who are scared of using net banking for online shopping due
to fear of fraud, state bank of India has introduced a virtual card that addresses
all such concerns. This electronic card can be created by the account holder
using SBI’s net banking facility for e-commerce transactions and he is not
required to share details of the principal account on the merchant website thus
insulating the account from any possible fraud. The new product is a
convenient and secure gate way to online payment for all internet banking
users.
2.5 MOBILE BANKING
Mobile banking also known as M.- Banking is a term used for
performing balance checks, account transactions, payments etc., via a mobile
device such as mobile phone or Personal Digital Assistant (PDA). Mobile
banking is most often performed via SMS or the mobile internet but can also
use special programs, called clients, downloaded to the mobile device.
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Mobile banking refers to provisions and availability of banking and
financial services with the help of mobile telecommunication devices. The
scope of offered services may include facilities to conduct bank and stock
market transactions, to administer accounts and to access customized
information.
2.5.1EVOLUTION OF MOBILE BANKING
The first mobile banking and payment initiatives were announced during
1999. The first major deployment was made by a company called pay box
financially supported by Deutsche bank. This company successfully deployed
the solution in Germany, Austria, Sweden, Spain and the U.K. At about 2003
more than a million people were registered on pay box and the company was
rated by Garther as the leader in the field. Another early starter and also
identified as a leader in the field was a Spanish initiative, called Mobi Pago.
The name was later changed to Mobi pay and all banks and mobile operators in
Spain were invited to join. The product was launched in 2003 and many
retailers were acquiring to accept the special VSSD payment confirmation.
Because of the complex shareholding and the constant political challenges of
the different owners, the product never fulfilled the promise that it had. With
no marketing support and no compelling reason for adoption, this initiative is
flounder at the moment. Many other large players announced initiatives and ran
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pilots with big fanfare, but never showed traction and all initiatives were
ultimately discontinued. Initiatives in Norway, Sweden and France never got
traction.57
France telecom launched an ambitious product based on a special
mobile phone with an integrated card reader. The solution worked well, but
never became popular because of the unattractive, special phone that
participants needed in order to perform these payments. Since 2004, mobile
banking and payment industry has come of age. Successful deployments with
positive business cases and big strategic impact have been seen.
The earliest mobile banking services were offered over SMS, a service
known as SMS banking. With the introduction of the first primitive smart
phones with WAP support enabled the use of the mobile web in 1999.
European banks were the first one to offer mobile banking on this platform to
their customers. Apple’s initial success with i phone and the rapid growth of
phones based on Google’s Android operating system have led to increasing use
of special client programs called apps, downloaded to the mobile device. With
the advancements in web technologies such as HTMLs, CSS 3 and Java Script
have seen more banks launching mobile web based services to complement
native applications.58
57
m-banking.blogaspot.com/2007/perspective-on-history 58 en.wikipedia.org/wiki/mobile-banking.
154
In different countries, mobile banking has already gained its popularity.
For example in the South Korean market LG Telecom teamed up with
Kookmin Bank to provide their mobile banking service in 2004 and since then
have seen a nice and steady growth
Mobile banking services in India started with SMS banking way back in
2002. Reliance Infocom has started providing mobile banking services to ICICI
bank and HDFC bank through their R. world environment. With an increasing
mobile subscriber base in India, mobile banking has picked up steam in recent
years. Recognizing the potential of mobile banking, Reserve Bank of India
issued the first set of guidelines in October 2008. The guidelines defined
mobile banking as undertaking banking transactions using mobile phones by
bank customers that involve credit or debit to their accounts. This definition in
a sense provided larger canvas to mobile payments which in a narrow sense
involved only payment made for a product or service using the mobile phone
either remotely or at the point of sale. The RBI has consciously adopted the
bank – led mobile banking model. The bank led model has also been endorsed
by the Inter – Ministerial Group of the Government of India constituted in
November 2009.59
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With the advent of smart phones and ever growing usage of internet on
mobile handsets, application based banking has emerged as a new concept
within this space. Other than SMS banking, banks are now offering banking
services on mobile handsets through WAP – based internet web links and
application based mobile banking services.
Today more than half the population in India has a mobile phone. As at
end March 2013, 55 banks with a customer base of around 23 million were
providing mobile banking service in India. Huge growth in Mobile
phones, affordability of hardest, and well-designed rates and tariffs by
telecommunication companies have made mobile phone available for
everybody. Indeed the same has become life blood for mobile banking in
India.60
2.5.2MOBILE BANKING SERVICES
Mobile banking is one of the three major pillars of revolutionary
improvement in the quality of service delivery of banks. Mobile banking is
simply performing banking transactions with the help of mobile phone. Using
mobile phone is a very common practice. Commercial banks are exploring this
opportunity to make their services more convenient for their customers.
Growing number of mobile subscribers in the country is the most valuable
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support behind the success of mobile banking. Mobile banking can be done
either through SMS, through browsing the internet on the cell phone or through
apps.
2.5.2.1SMS Format: In the SMS format, the bank gives a particular code,
which needs to be sent to a designated number and a response, is received from
the bank. These can be balance enquiry, stop cheque, account statement and
other such services.
2.5.2.2Browsing Method: In the browsing method, a particular bank’s website
can be accessed with the help of customer identification and net banking
password which is the same used for internet banking. However, the site for
mobile banking at times is different from what is seen on the computer and
users may take time to adjust. According to Internet and Mobile Association of
India, the number of mobile internet users increased to 87.1 million by
December 2012 and is expected to hit 92.9 million by March 2013.
2.5.2.3 Unstructured Supplementary Service Data (USSD) – based mobile
banking:
The USSD platform offers a common gateway to customers of all banks
to easily access and use mobile banking services. In this method customer dial
a two digit number prefixed with a star sign and followed by a hash tag. In
simple term, USSD services enable an operator to communicate with users, as
is the case with Airtels’ *121# service. Users can perform basic banking
operations through this. The department of telecommunication has asked all
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telecom companies to reserve *99# for USSD-based financial services. The
major advantage of USSD is that the IMPS could become accessible even
through low – end hand – sets. With this platform banking service is now
available on non-java mobiles without GPRS connections. It is currently
available with Aircel, Idea, MTNL, Vodafone and Tata Docomo connections.
The service is session based and requires a response from the user
within a reasonable time. The daily transaction limit is Rs.1000 per customer
with an overall calendar monthly limit of Rs.5000. Functionalities like fund
transfer within the bank, Enquiry services (Balance enquiry/mini statement)
and mobile top-up are available in USSD based services. TRAI has mandated a
tariff ceiling of Rs.1.50 per USSD mobile banking transaction that the telecom
firm would collect from subscribes.61
2.5.2.4Mobile Banking Services over Application/Wireless Application
Protocol (WAP):
This service is available on Java enabled mobile phones over SMS or
GPRS where the user is required to download the application on to the mobile
handset. The service can also be availed via WAP on both java and non-java
phones with GPRS connection. The mobile banking service will be available to
all the customers having current / savings bank account. The customer will
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have to register for the service. Daily transaction limits for fund transfer or bill
or merchant payment is Rs.50,000 per customer with an overall calendar month
limit of Rs2, 50,000. This service is a carrier-agnostic that is all customers can
avail the mobile banking service with the bank irrespective of the service
provider for their mobiles. The service is free of charge. However, the cost of
SMS or GPRS connectivity will have to be borne by the customer.
The functionalities available in the application based services/WAP are:
� Fund transfer within and outside the bank using NEFT.
� Enquiry services (Balance enquiry, Mini Statement) and cheque book
request.
� Demat enquiry service.
� Bill payment (utility bills, credit cards, and Insurance Premium
payments), Donations and subscriptions.
� M-Commerce (Mobile Top ups, Top up of direct to home, merchant
payment).
2.5.2.5Mobile Wallets: The mobile wallet is a prepaid instrument issued in
electronic form which resides on the mobile phone. Seeing the potential of
mobile wallets, RBI has laid down an enabling regulatory framework for
such instrument. Simply put, the mobile wallets being issued in India are e-
money products and can be used for purchase of goods and services. Mobile
wallets can also be used for fund transfers where the holder has been
subjected to a fully compliant KYC. The only difference in mobile wallets
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issued by non-banks in India and other countries is that cash-out is not
permitted in India, as it is akin to acceptance of demand deposit.
Ten entities have been authorized to issue mobile wallets, of them; one is a
subsidiary a leading telecom player. Several others are in the pipeline with
three to four of them being leading telecom players. As on September 2012, the
only telecom operator which offers something close to a mobile wallet in India
is Airtel. The operator has partnered with Axis bank to offer Airtel money
through which one can send money to other Airtel money customers, recharge
mobile phone, digital television and pay utility bills. India’s largest bank, the
State Bank of India has also launched similar services called SBI Mobi cash.
2.5.2.6 Inter – Bank Mobile Payment System (IMPS): The IMPS is a mobile
based remittance system which is inter-bank in nature and is owned and
operated by the National Payment Corporation of India (NPCI). The IMPS
facilitates access to banks accounts and transfer of funds through mobile
phones. The system launched in November 2010, provides real time transfer of
funds between the customers of different banks on 24x7 basis. In other words,
funds can be transferred any time to the beneficiary who receives the funds
instantaneously and both the sender and receiver get the confirmation of debit
and credit. Fifty (50) banks have started providing IMPS service to their
customers and as at the end of March 2012; banks have issued 36.32 million
Mobile Money Identifiers (MMID) to their customers.62
62 www.npci.org.in
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2.5.2.7Mobile Linked Kisan Credit Card (M-KCC):
Mobile linked Kisan credit card was launched by NABARD on a pilot
basis on October 2012, in Villupuram District of Tamilnadu for the farmers
having KCC accounts with the Pallavan Grama Bank. The M-KCC using
mobile technology enables farmers to carryout purchase of agricultural input in
a cashless manner. All transactions are carried out through mobile phones of
farmers and vendors registered with the bank and technical service provider.
The transaction is performed through a combination of a secured SIM card and
a PIN using an interactive voice recording /SMS system. This enables the
farmers to buy agriculture inputs by putting through the transactions through a
mobile phone enabled system linked to the bank Core Banking Selections
(CBS).63
2.5.3ADVANTAGES OF MOBILE BANKING
Mobile banking has lot of advantages for both, service providers and
those who avail services. It has really become multi-beneficial.
2.5.3.1Advantages to Banks:
Banks do not require much investment and they need not to modify their
existing infrastructure.
� Mobile banking also helps banks to make good relations with their
customers. In mobile banking the banks get valuable database of the
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customer which helps them in effective customer relationship
management practice. It facilitates in quick feedback and help in
customer retention and customer loyalty.
� Mobile phone provides a way to reach out people in isolated areas.
� When banks have database of their customers they can use SMS
advertising to give information about their services to their existing
customers. This also solves the purpose of promotion and may also help
in communicating new services.
2.5.3.2Advantages to Customers:
� Customers enjoy any time anywhere banking with the help of their
mobiles.
� They need not stand is queues and need not worried if the branch is not
at convenient location.
� As mobile banking is cost effective for bankers it is cost effective for
customers also.
� The information can also be stored automatically in mobile as a proof in
the form of SMS whether sent or received.
2.5.4 STATUS OF MOBILE BANKING IN INDIA
Mobile banking is enjoying a rapid growth in India. It has successfully
crossed the introduction stage. The service is being channelized from
metropolitan cities to urban areas and semi urban areas and then to the rural
areas. Transactions in mobile banking have been showing an uptrend.
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During February 2012, more than 2.8 million transactions for close to
1961.23 million were transacted, a 300 percent increase in volume and more
than 200 percent in value terms as compared to 0.7 million transactions for
close to Rs.616.19 million during February 2011. As at end March 2013, 55
banks with a customer base of around 23 million were providing mobile
banking service in India compared to 49 banks and a 13 million customer base
at the end of March 2012. During 2012-13, 53 million transactions valued
around 60 billion were transacted, thus registering a growth of 108 percent and
229 percent, respectively, over the previous year. The removal of transaction
limits on mobile banking and the raising of limits for transactions that can be
sent without end-to-end encryption have contributed to this increase.64
The Reserve Bank of India has reported that the number of mobile
banking transactions in India has increased by 6.01 percent to 7.1 million
transactions for the month of September 2013 up from 6.76 million transactions
reported in August 2013.The total amount transacted for the month has also
increased by 10.85 percent to Rs.1565 crore from Rs.1412.7 crore in August
2013.65
It is worth noting, that May 2013 registered a significant month on
growth in both number of transactions and the amount transacted. The number
64 blogs.fortester.com
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163
of transactions increased to 6.87 million transactions from 6.33 million in April
2013, while the amount transacted increased to Rs.1.19 crore from Rs.0.99
crore in April 2013.
As a result, the average amount, transacted increased to Rs.1,738.87 on
May 2013 from Rs.1558.71 in April 2013 and has been showing a growth ever
since, except for June 2013 when the amount declined to Rs.1730.52 due to a
dip in the number of transactions and a minor dip in the amount transacted.
Though mobile banking is synonymous with the word convenience
banking, its usage is not anywhere close to its potential. According to National
Payment Corporation of India, almost 90 percent of the mobile transactions are
done for bill payments and mobile top ups. A small fraction of the remaining
10 percent is for inter-bank fund transfer and rest for intra-bank fund transfer.
Among other services, ticket booking is also prevalent among them who
avail mobile banking facility. A bulk of the mobile banking is used for
enquiries such as balance status or service products such as new cheque book
issuance. Among the financial services, mobile top-ups are on the top. Next
could be movie ticket or air ticket booking.
According to the survey conducted by ACI World Wide, Mobile
banking has really caught up in India. India cores in Second in terms of making
payments on mobile. Mobile banking is increasingly being seen as a tool for
differentiation in customer servicing by banks. To provide customers a “mobile
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Wallet” is being seen as one of the top priorities for banking institutions in the
near future.66
Experts are hopeful about the future of mobile banking. According to a
2012 report by Boston Consulting Group, the total mobile banking transaction
in India is expected to reach $350 billion by 2015. With more and more people
joining the bandwagon, it should soon become a norm to use mobiles for
banking services on the go.
2.5.5 STEPS TAKEN BY RBI IN MOBILE BANKING
The reserve bank recognized the potential of the mobile phone as a
channel to conduct financial services and first set of guidelines were issued
way back in October, 2008. A per transaction limit of Rs.2500 has been
imposed on all mobile banking transactions and an overall cap of Rs.5000 then
revised as Rs.50, 000 per day per customer has been imposed by the RBI.
The mobile banking guidelines have been modified in December 2011
to permit banks to facilitate funds transfer both for personal remittances and
purchase of goods and services without any ceiling. In respect of small value
transactions fund transfers up to Rs.5000 can be effected through mobile phone
without the need for end-to-end encryption.
In order to provide domestic money transfer facility especially to
migrant population who do not have access to formal banking channels,
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165
domestic money transfer guidelines have been issued in October 2011.
Remittance from a bank account for cash pay out to the beneficiary not having
a bank account at an ATM/BC (Business Correspondent) outlet has also been
facilitated up to Rs.10,000 per transaction subjective to a monthly cap of
Rs.25000 per beneficiary with the remitting bank obtaining only the full name
and address of the beneficiary.
Similarly cash pay in facility has been permitted up to Rs.5000, per
transaction to a monthly cap of Rs.25, 000 per remitter for transfer of funds to a
bank account. Bank need not take any document or proof of address.
The Inter-bank Mobile Payment Services (IMPS) operated by the
National Payment Corporation of India (NPCI) with the approval of RBI has
enhanced the efficiency of mobile banking by enabling real time transfer for
funds between bank accounts and providing a centralized inter-operable
interbank settlement service for mobile banking transactions with confirmation
features.
2.5.6 OPPORTUNITIES AND CHALLENGES FOR MOBILE BANKING
Any technology that is well-accepted and widely available at affordable
costs and suitable for banking and payment services, provides an immense
opportunity to extent these services to all areas and all sections of the society,
both banked and unbanked. Mobile banking technology scores on all these
parameters and can act as a catalyst to usher in the universal goal of financial
inclusion shared by all the stake holders.
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In a large country like India where a majority of population still lives in
rural areas that do not have presence of formal banking, providing banking
facility has been a major challenge. Of the 0.6 million villages in India, the
total number of villages with the banking services through brick and mortar
branches and alternate banking channels stand at approximately 0.14 million
villages as at end March 2012.
India has the highest number of households (approximately 145 million)
who are excluded from banking. However with the growing reach of the
mobile in hinterland, it has now become possible to provide the banking
facilities to people who are not able to enjoy this facility so far. At the end of
January 2012, the total wireless subscriber base was 936 million out of which,
313 million subscribers were from rural areas. Use of mobile banking services
among this huge base of subscriber is however very low67
. Even among the
existing bank customers less than one present of them are covered under the
mobile banking. Notwithstanding the existing low base of customers, the
growth of mobile banking transactions has shown increasing trend.
With large mobile handset penetration, it is the obvious choice to cross
the extremely low credit or debit card penetration barriers. Currently, mobile
banking is in the partnership with almost all telecom operators joining hands
with leading banks. Also, all operators have started rolling out 3G networks
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across the country. Mobile banking will be one of their key value-added service
offerings to cash in on 3G services.
Another potential factor that has attracted all the stakeholders including
policy makers to this innovative technology is the lower cost associated with
this model in providing banking services both amongst the existing customers
and in taking banking to the hinterland as well.
According to industry experts, mobile banking is the cheapest way to
reach rural customers. While it cost $ 523 to $837 to setup a micro-banking
outlet, replacing this facility with mobile banking technologies cost only $209.
The RBI reports that while the government typically incurring a transaction
cost of 12-13 percent, mobile banking brings this cost down to two percent.68
Security concerns of end users act as an impediment to the uptake of mobile
banking services. These concerns relate to being subjected to fraud in this
mode of payment as well as with respect to data privacy. The lack of awareness
about services and security protocols are also impeding the growth of these
services. The low penetration of smart phones is another impeding factor,
which may prevent the large scale adoption of sophisticated mobile banking
applications. Another impeding factor is the language barrier and low comfort
level of users due to poor literacy level.
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Though reforms in the form of the RBI instituting regulatory protocols
for mobile banking have been introduced, the regulator still has some way to go
in terms of facilitating the mobile eco system for growth with an integrated
frame work.
2.6 ELECTRONIC FUND TRANSFER SYSTEMS
An electronic funds transfer also known as EFT is a system for
transferring money from one bank to another without using paper money. The
history of electronic funds transfer originated from the common funds transfer
of the past. Since the 19th
century, with the help of telegraphs, fund transfers
were a usual thing in commercial transactions. Finally, it migrated itself to
computers and became the electronic money transfers of today. One kind of
EFT is a cash card. With this type of card one can spend a prepaid amount of
money until the balance is zero. The transaction done at bank ATM using credit
or debit card is also a kind of EFT. Point of sale (POS) are also part of this
group. Those POS terminals in which we pass our card are doing an electronic
fund transfer from our account to the retail account.
The initiatives taken by RBI in the mid-eighties and early – nineties
focused on technology based solutions for the improvement of the payment and
settlement infrastructure, coupled with the introduction of new payment
products by taking advantage of the technical advancements in banks. The
continued increase in the volume of cheques added pressure on the existing set-
up thus necessitated a cost effective alternative system.
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2.6.1 ELECTRONIC FUND TRANSFER
The EFT system was operationalized in 1995 covering 15 centers. EFT
system hosted and operated by the RBI, permits transfer of funds, upto Rs.5
lakhs from any account at any branch of any member bank in any city to any
other account at any branch of any member bank in any other city. This system
utilizes the service branches of the member bank and the nodal offices of RBI.
RBINET is the conduit for the flow of funds. RBI NET is a communication
system operating over the BANK NET. BANK NET is a payment network
established by RBI during 1991. The Reserve Bank of India acts as the service
provider as well as regulator. Using this method, funds are credited in to the
receiver’s account either on the same day or within a maximum period of 4
days, depending upon the time at which the EFT instructions are given and the
city in which the beneficiary account is located. Usually the transactions done
in first half of the day will get first priority of transfer than the transaction done
in second half. This system is no longer available for use by the general public,
for whose benefit a feature –rich & more efficient system is now in place which
is National Electronic Fund Transfer.69
Special EFT (SEFT) was introduced in April 2003 covering about 3000
branches in 500 cities. This has facilitated same day transfer of funds across
accounts of constituents at all these branches. Then, it was made mandatory by
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170
the RBI for all the banks on the SEFT system to migrate to NEFT by mid
December 2005. As such, SEFT was discontinued as of January 2004. The RBI
welcomed banks that were full members of the RTGS to Join the NEFT
system.
2.6.2 NATIONAL ELECTRONIC FUND TRANSFER
A new variant of the EFT called the National Electronic Fund Transfer
(NEFT) is a nationwide electronic fund transfer system introduced in
November 2005 by Reserve Bank of India. It was implemented to broad base
the facilities of EFT. It is a retail electronic funds transfer mechanism between
the networked branches of banks.
The objective of the NEFT system is to establish an electronic funds
transfer system to facilitate an efficient, secure, economical, reliable and
expeditious system of funds transfer and clearing in the banking sector
throughout India and to relieve the stress on the existing paper based funds
transfer and clearing system.
In this system, payment instructions between banks are processed and
settled on net settlement (Deferred net settlement) basis at fixed times during
the day. The transfer takes place either on the same day or on the next day,
depending on time of instructions given. There is no minimum or maximum
limit of transaction value for using this facility.
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NEFT provided for integration with the Structured Financial Messaging
Solution (SFMS) of the Indian Financial Network (INFINET). The NEFT uses
SFMS for EFT message creation and transmission from the branch to the banks
gateway and to the NEFT Centre, thereby considerably enhancing the security
in the transfer of funds.70
With the SFMS facility, branches can participate in both the RTGS and
the NEFT system. It is envisioned that all the RTGS enabled bank branches
would be NEFT enabled too, so that the customer would have a choice between
RTGS and NEFT, based on time urgency, value of transaction and different
charges applicable on the two systems.
As the NEFT system stabilized overtime, the number of settlements in
NEFT was increased from the initial two to eleven. NEFT now provides eleven
settlements from 9 am to 7 pm on weekdays and five settlements from 9 am to
1 pm on Saturdays and enables funds transfer to the beneficiaries account on
net basis, bringing it closer to real time settlement. Using the NEFT
infrastructure, a one-way remittance facility from India to Nepal has also been
implemented by the RBI since 15th
May 2008.
In order to increase the coverage of NEFT to a wider section of bank
customers in semi-urban and rural areas, an enhancement of the NEFT called
the NEFT-X [National EFT (extended)] is also proposed for phase wise
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172
implementation. This would facilitate non-networked branches of banks to
transfer funds electronically by accessing NEFT – enabled branches for transfer
of funds. NEFT (extended) would work on a T+1 basis and would ensure wide
rural coverage of the electronic funds transfer system.
2.6.2.1CUSTOMER CHARGES APPLICABLE ON NEFT
The rationalized customer charges levied by the banks for NEFT transactions
are as under:
Table 2.6
CHARGES APPLICABLE ON NEFT
Value Maximum charges (Exclusive
of service tax)
Amounts up to Rs.10,000 Rs.2.50
Amounts from Rs.10,001 to 1 lakh Rs.5
Amounts above Rs.1 lakh up to Rs.2 lakh Rs.15
Amount above Rs.2 lakh Rs.25
Source: www.sbi.co.in
2.6.2.2PERFORMANCE OF NEFT
All the refinements to the national electronic fund transfer scheme have
been paved way for the growth of this product in terms of acceptability, reach
and volumes handled. As at March end 2012, around 84,000 branches of 109
banks participated in the NEFT system with the addition of 13,980 branches
during 2013, the number of bank branches participating in NEFT has grown to
100,429. There are around 650 sub-member banks participating in NEFT.
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The NEFT handled a record volume of 47 million transactions valued at
around 3602 billion in the month of March 2013.
Table 2.7
Value and volume of NEFT Transactions
Year Volume (Million) Value (Billion)
2008-09 32.2 2519.5
2009-10 66.3
(105.9)
4095.0
(62.53)
2010-11 132.3
(99.55
9391.5
(129.34)
2011-12 226.1
(70.9)
17903.5
(90.64)
2012-13 394.1
(74.3)
29022.4
(62.10)
• Figures in parenthesis represent percentage of charge over previous year.
Source: compiled from RBI repot on trend and progress of banking in India various issues
The value and volume of NEFT is increasing year by year. During 2009-
10 the volume of transaction increased 105.9 percent and the value increased
62.53 percent as compared to 2008-09. The volume of transaction increased
from 226.1 million in 2011-12 to 394.1 billion in 2012-13. The aggregate value
of transactions increased from 17903.5 billion to 29022.4 billion during 2012-
13. The percentage of growth is higher with respect to volume in the year
2012-13, whereas, the percentage of growth is low with respect to value of
transactions done through NEFT when comparing with the previous year.
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2.6.2.3 EFFICIENCY ENHANCEMENT IN NEFT
Two efficiency enhancement features were introduced in the NEFT
system. An additional batch at 8 a.m. was introduced, taking the total number
of batches to 12 on weekdays and 6 on Saturdays. Further, the continuous
release of credit messages was introduced which increases the time available at
destination banks to process inward NEFT transactions and facilitate more
efficient handling of the growing volumes. To facilitate the migration of small
value transactions from cash or cheque to NEFT, customer charge for
transactions up to Rs.10000 were reduced to Rs.2.50.
2.7 REAL TIME GROSS SETTLEMENT
Payment and settlement systems serve an important role in the economy
as the main arteries of the financial sector. India has a myriad of payment
systems, while settlement systems in the country have generally tended to fall
in the category of deferred net settlement system which entails some elements
of risk. With the view to provide less risky system which could also comply
with the requirements of the core principles for Systematically Important
Payment Systems of the Bank for International Settlement (BIS) the RBI
implemented the RTGS.
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Real Time Gross Settlement is a system of transferring funds from one
bank to another on an immediate basis71
. In this system, the transactions are
settled individually without netting debit against credit.
The Real Time Gross Settlement has been launched by the RBI on 26th
March 2004 in the financial market. RTGS is a fund transfer mechanism where
transfer of money takes place from one bank to another on a ‘real time’ and on
‘gross’ basis. This is the fastest possible money transfer system through the
banking channel in India. Settlement in real time means payment transaction is
not subjected to any waiting period. The transactions are settled as soon as they
are processed. Gross settlement means the transaction is settled on one to one
basis without bunching with any other transaction.
2.7.1Unique Features of RTGS
� The payments are settled transaction by transaction.
� The settlement of funds is final and irrevocable.
� The settlement is done in real time and the funds settled can be used
immediately.
� It is a fully secure system, which uses digital signature and public key
infrastructure based encryption for safe and secure messaging
transmission.
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� It is primarily for large value transactions with the minimum threshold
limit of Rs.2 lakhs.
� It provides for intra-day collateralized liquidity support for the member
banks to smoothen the temporary mismatches of fund flows and thereby
ensuring smooth settlements.
� Under the RTGS system, inter-bank transactions, customer based inter-
bank transactions and net clearing transactions can be settled.
Thus, it provides less risk based fund transfers for both banks and for
their customers apart from providing for more efficient fund management at the
treasures of banks.
2.7.2COMMON INTERFACE FOR RTGS SYSTEM
The participating banks can access RTGS system through the means
provided by the Central Bank. The common interfaces provided for RTGS
system are straight through processing (STP) Web Interface (WI) and
participant Interface (PI).
2.7.2.1Straight Through Processing (STP): If the participating bank has
core banking system then it can be interfaced with the RTGS through
connecting mechanism called Straight Through Processing (STP). STP is
defined as that the payment transactions are keyed in only once and processed
until settlement. The transaction request message will be automatically routed
to RTGS system and the response received from RTGS will be processed and
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sent to the appropriate system that raised the transaction request. STP is very
useful when there are many RTGS transactions to be submitted and manual
entry of each transaction is difficult.
2.7.2.2Web Interface (WI): With the advent of technology the latest RTGS
implementations are normally provided with the web interface. The WI is user
friendly and there is no need to install any separate software. Web browsers
like Internet Explorer and Firefox can be used to submit transactions to the
RTGS system. All error messages and notifications including the settlement
notification will be received by WI.
2.7.2.3 Participant Interface (PI): The participant interface is thin application
that is installed in the commercial banks. The user can enter transactions in PI
which submits it to the RTGS system in Central Bank through communication
network. All error messages and notifications including the settlement
notification will be received by PI.
2.7.3 Time of Settlement and Charges per Transaction
RTGS charges depends on the amount transferred as well as the timings
of the day when it’s done. A RTGS transfer early will cost a little less charge.
Service tax is also applicable to the charges.
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Table 2.8
Time of Settlement at the Charges per Transaction
RTGs Reserve Bank of India Charges per transaction for
outward transactions
From To
1
9:00
Hours
12:00 Hours
Rs.2 lakhs to
Rs,25
Rs,5 lakhs
Above Rs.5 lakhs
Rs.50
2
After
12:00
Hours
15:30
[13:00 Hrs.
On Saturday]
Rs.2 lakhs to
Rs.26
Rs 5 lakhs
Above Rs.5
Rs.51
lakhs
3
After
15:30
Hours
16:30 Hrs.
[on week days]
Rs.2 lakhs to
Rs.30
Rs.5 lakhs
Above Rs.5 lakhs
Rs.55
Source: www.sbi.co.in
2.7.4 PERFORMANCE OF RTGS SYSTEM
The reach and utilization of the RTGS has witnessed a sustained
increase since its introduction in 2004. The bank branch network coverage of
the RTGS system increased to 58720 branches at more than 10,000 centres
facilitating the increased usage of this mode of fund transfer. The RTGS
processed transactions to a settlement value of around Rs.8 trillion on March
28, 2013, which is the highest value settled through RTGS on a business day.
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Table2.9
Growth of Real Time Gross Settlement Transactions
Year Volume (in millions) Value (in billions)
2008-09 13.3 322.8
2009-10 33.2
(149.6)
394.5
(22.2)
2010-11 49.3
(48.49)
484.9
(22.9)
2011-12 55.0
(11.56)
539.3
(11.2)
2012-13 68.5
(24.5)
676.8
(25.5)
Figure in parenthesis represents parentages of change over previous year.
Source: compiled from RBI repot on trend and progress of banking in India various issues
The value and volume of RTGS is increasing year by year. During
2009-10 the volume of transaction increased 149.6 percent and the value
increased 22.2 percent as compared to 2008-09. The volume of transaction is
increased from 55 million in 2011-12 to 68.5 million in 2012-13. The aggregate
value of transactions increased from 539.3 billion to 676.8 during 2012-13.
2.7.5 RBI INITIATIVE
Under the overall guidance of the Board of Payment and Settlement,
RBI over the last few years has been taking a number of steps to popularize the
electronic payment system in the country. In this connection the following are
the recent steps taken by RBI.
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2.7.5.1 Next Generation Real Time Gross Settlement (NG – RTGS):
RTGS system facilitates online transfer of high-value funds between
bank customers of different banks on real time basis and currently handles
about three lakhs transactions per day. Ever since RBI started RTGS system in
March 2004, it has been highly successful and a preferred mode of inter-bank
transfer of large value funds by the customers of various banks, as funds get
transferred almost instantaneously
Keeping in view of the ever increasing usage of the system, RBI has
decided to replace the existing RTGS system with a next generation Real
time Gross settlement system.
The new system would be implemented for the entire banking and
financial sector of the country. Currently, RTGS system, under which funds
worth Rs.2 lakh or more can be transferred is handling an average of 3 lakhs
transactions per day, up from only 4000 transactions when it was launched in
2004.RBI expects 7 lakh transaction per day through RTGS very soon, 25 lakhs
transactions per day in five years and then about 50 lakh transactions per day in
the next 10 years.
The new system would have initial capability of handling 7-12 lakh
transactions a day and an up gradation potential of 25-50 lakh transactions
every day. Besides, the new system would also incorporate various new
functions for the benefit of bank customers. The NG-RTGS system would have
advanced liquidity management features and queue management techniques
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and would allow the bank customers to initiate fund transfers for future dates
and get information about the status of their transaction through SMS alerts.72
2.7.5.2 Liberalized access criteria for centralized and decentralized
payment system
In 2012, RBI announced liberalized revised access criteria for
centralized and decentralized payment systems. The centralized payment
systems, viz., RTGS and NEFT, currently provide for only direct membership.
As an exception, Regional Rural Banks have been given access to the NEFT
system through their sponsor banks. Now it has been decided to expand the
sub-membership route to all licensed banks to participate in NEFT & RTGS
systems. This would be an alternate mechanism to all licensed banks which
have the technological capabilities but are not participating in centralized
payment systems on account of either not meeting the access criteria or
because of cost considerations. The sub-members would participate in the
centralized payment systems through their sponsor bank in which is a direct
member of the centralized payment system.73
2.8 ELECTRONIC CLEARING SERVICE
The Electric Clearing Service (ECS) introduced by the RBI in 1995, is
akin to the Automated Clearing House System that is operational in certain
other countries like the U.S. ECS is an electronic mode of payment/receipt for
transactions that are repetitive and periodic in nature.
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182
ECS is used by institutions for making bulk payment of amounts
towards distribution of dividend, interest, salary, pension etc., or for bulk
collection of amount towards telephone, electricity, water dues cess or tax
collections, loan installment repayments, periodic investments in mutual funds,
insurance premium etc., Essentially, ECS facilitates bulk transfer of monies
from one bank account to many bank accounts or vice versa.
2.8.1 VARIANTS OF ECS
Primarily, there are two variants of ECS. They are ECS credit and ECS
debit.
2.8.1.1 ECS CREDIT
ECS credit is used by an institution for affording credit to a large
number of beneficiaries having accounts with bank branches at various
locations within the jurisdiction of an ECS Centre by raising a single debit to
the bank account of the user institution. ECS credit enable payment of account
towards distribution of dividend, interest, salary, pension, etc., of the user
institution.
The user intended to effect payment through ECS credit has to submit
details of the beneficiaries like name, bank or branch, account number of the
beneficiary, MICR code of the destination bank branch etc., date on which
credit is to be afforded to the beneficiaries etc., in a specified format through its
sponsor bank to one of the ECS centers where it is registered as a user.
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The bank managing the ECS Centre then debit the account of the
sponsor bank on the scheduled settlement day and credits the account of the
destination banks, forward credit to the accounts of the ultimate beneficiaries
with the destination bank branches.
2.8.1.1.1 Advantages of ECS credit Scheme to the beneficiary
� The beneficiary need not visit his/her bank for depositing the paper
instruments.
� The beneficiary need not be apprehensive of loss or theft of physical
instruments or the likelihood of fraudulent encashment thereof.
� Cost effective.
� The beneficiary receives the funds right on the due date.
2.8.1.1.2Advantages to the user institutions:
� Savings on administrative machinery and cost of printing, dispatch
and reconciliation of paper instruments.
� Avoid chances of loss or theft of instruments in transit, likelihood of
fraudulent encashment paper instruments etc., and subsequent
correspondence or litigation.
� Efficient payment made ensuring that the beneficiaries get credit on
designated date.
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2.8.1.1.3Advantages to the Banking System
� Freedom from paper handling and the resultant disadvantages of
handling, presenting and monitoring paper instruments presented in
clearing. Ease of processing and return for the designation bank
branches.
� Smooth process of reconciliation for the sponsor banks.
� Cost effective.
2.8.1.2 ECS DEBIT
ECS debit is used by an institution for raising debits to a large number
of accounts maintained with bank branches at various locations within the
jurisdiction of an ECS Centre for single credit to the bank account of the user
institution. ECS debit is useful for payment of telephone, electricity, water bill,
cess or tax collections, loan installment repayments, periodic investments in
mutual funds, insurance premium etc., that are periodic or repetitive in nature
and payable to the user institution by large number of customers etc.
The ECS debit user intending to collect receivables through ECS debit
has to submit details of the customers like name, bank or branch, account
number of the customer, MICR code of the destination bank branches etc., date
on which the customer’s account is to be debited etc., in a specified format
through its sponsor bank to the ECS Centre.
The bank managing the ECS Centre then passes on the debit to the
destination banks for onward debit to the customer’s account with the
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destination bank branch and credits the sponsor bank’s account for onward
credit to the user institution. Destination bank branches will treat the electronic
instructions received from the ECS Centre on with the physical cheques and
accordingly debit the customers’ accounts maintained with them. All the
unsuccessful debits are returned to the sponsor bank through the ECS Centre
within the specified time frame.
2.8.1.2.1Advantages of ECS Debit scheme to the customers:
� ECS debit mandates will take care of automatic debit to customer
accounts on the due dates without customers having to visit bank
branches or collection centres of utility service providers etc.,
� Customers need not keep track of due date for payments.
� The debit to customer accounts would be monitored by the ECS
users, and the customers alerted accordingly.
� Cost effective.
2.8.1.2.2Advantages to the user institutions:
� Savings on administrative machinery and cost of collecting the
cheques from customers, presenting in clearing, monitoring their
realization and reconciliation.
� Better cash management because of realization or recovery of
dues on due dates promptly and efficiently.
186
� Avoids chances of loss or theft of instruments in transit,
likelihood of fraudulent access to the paper instruments and
encashment thereof.
� Realization of payment on a uniform date instead of fragmented
receipts spread over many days.
2.8.1.2.3Advantages to the Bank System:
� Freedom from paper handling and the resultant disadvantages of
handling, receiving and monitoring paper instruments presented
in clearing.
� Ease of processing and return for the destination bank branches.
Destination bank branches can debit the customer’s account after
matching the account number of the customer in their database
and due verification of existence of valid mandate and its
particulars. With core banking system in place and straight –
through processing, this process can be completed with minimal
manual intervention.
� Smooth process of reconciliation for the sponsor banks.
� Cost effective.
2.8.2CATEGORIES OF ECS SCHEME
Based on the geographical location of branches covered, there are three
broad categories of ECS schemes – Local ECS, National ECS and Regional
ECS.
187
2.8.2.1Local ECS: This is operating at 81 centres across the country. At each
of these ECS centres, the branch coverage is restricted to the geographical
coverage of the clearing house, generally covering one city or satellite towns
and suburbs adjoining the city.
2.8.2.2National ECS (NECS): This is the centralized version of ECS credit
which was launched in October 2008. The scheme is operated at Mumbai and
facilitate the coverage of all core – banking enabled branches located anywhere
in the country. This system takes advantages of the core banking system in
banks. Accordingly, even though the inter-bank settlement lakes place centrally
at one location at Mumbai, the actual customers under the scheme may have
their accounts at various bank branches across the length & breadth of the
country. Banks are free to add any of their core-banking – enabled branches in
NECS irrespective of their location.
As of March 31, 2009 as many as 114 banks with 26,275 branches
participate in NECS. With the addition of 18,257 branches during the year
2013, the coverage of the NECS has been increased 75,659 locations as at the
end of July 2013.
2.8.2.3Regional ECS (RECS): Next to NECS, RECS has been launched
during the year 2009.The RECS is a miniature of the NECS. This is operating
at 9 centres or locations at various parts of the country. RECS facilitates the
coverage of all core – banking enabled branches in a state or group of states
and can be used by institutions desirous of reaching beneficiaries within the
188
state or group of states. The system takes advantage of the core banking system
in banks. Accordingly, even though the inter-bank settlement takes place
centrally at one location in the state, the actual customers under the scheme
may have their accounts at various bank branches across the length and breadth
of the state or group of states.
2.8.3 PROCESSING AND SERVICE CHARGES LEVIED UNDER ECS
The Reserve Bank of India has deregulated the charges to be levied by
sponsor banks from user institutions. The sponsor banks are, however, required
to disclose the charges in a transparent manner. With effect from1st July 2011,
originating banks are required to pay a nominal charge of 25 paise and 50 paise
per transaction to the clearing house and destination bank respectively. Bank
branches do not generally levy processing or service charges for debiting the
accounts of customers maintained with them.
189
2.8.4 GROWTH OF ECS TRANSACTION
Table 2.10
Growth of Value and Volume of ECS Transactions as at March end
Year ECS Credit ECS Debit
Value
(Billion)
Volume
(in Millions)
Value
(Billion)
Volume
(in Millions)
2007-08
7.8 78.3 0.5 127.1
2008-09 0.9
(-88.5)
88.3
(12.8)
0.6
(20)
160.0
(25.9)
2009-10 1.2
(33.3)
98.1
(11.1)
0.7
(16.7)
149.3
(-6.7)
2010-11 1.8
(50.0)
117.3
(19.6)
0.7
(Nil)
156.7
(4.9)
2011-12 1.8
(Nil)
121.5
(3.6)
0.8
(14.3)
164.7
(5.1)
2012-13 1.8
(Nil)
122.2
(0.58)
1.1
(37.5)
176.5
(7.2) *Figures in parenthesis represent percentage change over previous year
Source: compiled from RBI repot on trend and progress of banking in India various issues
The above table shows the value and volume of ECS transactions of
scheduled commercial banks. The value of ECS credit has declined 88.5
percent during 2008-09, whereas the volume of ECS debit declined 6.7 percent
during 2009-10. Comparing value and volume of ECS credit during 2011-12
with 2012-13 the percent of growth is not much impressive, whereas ECS debit
(2012-13) showed a reasonable growth over the previous year (2011-12) both
in terms of value and volume.
190
2.9 ANY BRANCH BANKING
Any Branch Banking is the new system of banking adopted and made
popular by a few foreign banks. It is now adopted by many banks in India. This
facility is a technology based customer friendly service. Under this system, a
customer having account with any select branch can operate it from other
designated branches of the bank throughout the country. The networking of
branches under Core Banking Solution helps to offer this facility through
centralized data management. This facility includes cash withdrawal, cash
deposit, transfer of funds, and collection of local cheques, intra-city and
intercity transactions. Now distance is no hindrance and banking has become
more convenient for customers.
Any branch banking customers are in fact, turning more and more
insistent on this services from their banks, which enables to transact anywhere
in the country. The any branch banking middle ware/switch will be connected
to the branch system on – line through the leased lines to be provided by the
bank. This facility is will allow branch - to - branch transactions to be debited
on-line to customers’ accounts at the branches of the bank which are in the
network.
Facilities available to any branch banking customers:
� Balance Enquiry
� Get statement of account for any given period.
� View last five transactions in the account.
191
� Withdraw from the account (Maximum Rs.50,000 per day)
� Remit in to the account (maximum 25,000 per day)
� Deposit of cheques at non-home branch.
� Deposit of clearing instrument at non-home branch.
� Transfer of funds from home branch to third party accounts at
another CBI branch.
� Passbook updating at non-home branch.
2.10 DEMAT ACCOUNT
Demat refers to a dematerialized account. Demat account is just like a
bank account where actual money is replaced by shares. A demat account holds
portfolio of shares in electronic form and obviates the need to hold shares in
physical form. The account offers a secure and convenient way to keep track of
shares and investments without the hassle of handling physical documents that
get mutilated or lost in transit. The securities and exchange board of India
mandates a demat account for share trading involving more than 500 shares.
Demat account eliminates risk associated with physical certificates such
as bad delivery, fake securities, delays, forgery, counterfeiting, theft and loss
due to fire. It enables quick ownership of securities on settlement thereby
resulting in increased liquidity. It reduces paper work involved in transfer of
securities.
Demat account obviates the need to pay stamp duty that is in case of
physical shares 0.5 percent stamp duty is payable. There is no odd lot problem.
192
Even one share can be bought and sold. Demat account can be opened with no
balance of shares and there is no minimum balance to be maintained either.
One can have a zero balance in his/her account.
To open a demat account one has to approach the depository, participant
(DP) the agents of depository are called DP. A DP just give an account to hold
shares of the customer. There are over 100 DPs. Most banks are also depository
participants. A depositary is a place where the stocks of investments are held in
electronic form. There are only two depositories in India. They are National
Securities Depository Ltd., (NSDL) and Central Depository Services Ltd
(CDSL),
2.11 SMART CARD
A smart card is a plastic card containing a small chip that includes a
microprocessor and memory. The same size as a credit card, it holds contacts
that allow other devices to communicate with the card. It can contain more data
than a magnetic strip and can be programmed to reveal only the relevant
information.
A smart card is a card that is embedded with either a micro-processor
and a memory chip or only a memory chip with non-programmable logic. The
micro-processor card can add delete and otherwise manipulates information on
the card, while memory chip card can only undertake a pre-defined operation.
Optical memory cards looks like a card with a piece of a CD glued on top,
which can store up to 4MB of data.
193
In the 1950s, charge card company Dinners club produced the first card
to use for financial payments. The company used synthetic materials called
PVC. It conferred prestige on a select group that owned this card. By the time
other companies like VISA and Master Card entered this market, the PVC card
evolved to a machine – ready card, then to an integrated circuit card, in
response to a need for better security regarding transactions. It was not until
1977 that the smart card began to be mass produced. In 1984, the smart card
reached a milestone when the French postal and Telecommunication Services
(PTT) successfully tested ATM bank card with chips. Within two years, the use
of smart cards proliferated throughout the world.74
In 1994, Europe, Master card and visa came to joint agreement on
developing specifications for the use of smart cards in banking. The use of
smart cards continues to grow, applied to several activities from making phone
calls to ATM withdrawals.
In India the RBI has asked commercial banks, regional rural banks and
co-operative banks to issue smart cards to farmers under the revised kisan
credit card scheme so that they can access credit with ease.
These cards are compatible for use in the ATM, hand held swipe
machines, point of sale terminals and mobile banking and are capable of
storing, among others adequate information on farmers identity, asset, land
holdings and credit profile.
74 www.ehow.com
194
The smart card market in India is expected to generate Rs.5, 276.6 crore
in revenues by 2015, an increase of Rs.2173 fromRs.3, 103.6 crores revenue in
2011. During the same period 2012-15, the market is set to grow at a
compound annual growth rate of 12.3 percent, according to report released by
Cyber Media Research (CMR).75
As of now, smart cards are used for a wide
range of applications across government, transportation, telecommunications,
banking, IT – ITes and Healthcare sectors.
2.12 E-BANKING THREATS
The convenience offered by technology unfortunately has an evil side as
well that do not originate from its use rather by the misuse of the same. Despite
technological advancement data privacy is still a relevant area of concern for
banking customers.
The study group on large value bank frauds defines fraud as “a
deliberate act of commission or omission by any person, carried out in the
course of a banking transaction or in the books of accounts maintained
manually or under computer systems in banks, resulting in to wrongful gain to
any person for a temporary period or otherwise with or without any monitory
loss to the banking.
75 cmrinda.com/india-smart.card-market
195
2.12.1ATM FRAUD
The problem of ATM fraud is global in nature. Economic frauds carried
out through ATM are now getting sophisticated and trendy with both technical
and human expertise employed to siphon off the crisped currency from their
chest. Fraud against ATMs and people attempts to use them takes several
forms.
2.12.1.1 The Lebanese Loop: In this scam, a blocking device referred to as
Lebanese loop is inserted in to the card slot to trap the card inside the ATM
card reader by the fraudsters.
2.12.1.2 Card Skimming: Skimmers are devices added to ATM machines, to
capture card’s information including account number, balance and PIN
number. These devices often mounted alongside a machine and are difficult to
notice.
2.12.1.3 Shoulder Surfing: Criminals looking over cardholders shoulder when
he is keying in PIN number at ATMs to obtain valuable card details.
2.12.1.4 Wireless Video Camera: Another way to clown ATM PIN number is
to mount a wireless video camera inside the ATM area. It can look as harmless
as a brochure holder.
2.12.1.5 Fake Pin Pads: In addition to using cameras to collect PIN numbers,
scammers have designed fake PIN pads that they place top of the original ATM
PIN pad.
196
2.12.1.6 Cash Trapping: Similar to the Lebanese loop where a thin sleeve
traps the card, this time cash is trapped by a sleeve or device slipped inside the
cash dispenser.
2.12.1.7 Fake Atm: Fraudsters have also taken to occasionally putting up fake
ATM machines in and around shopping centers and other public locations.
2.12.2 CARD FRAUD
The most common type of attack is credit card or debit card fraud. Most
internet fraud is done through the use of stolen credit card information which is
obtained in many ways. Some of the methods used to wheedle out precious
card information are discussed below.
2.12.2.1 Phishing Emails: Phishing is the criminally fraudulent process of
masquerading as a trustworthy entity in an electronic communication in order
to acquire sensitive information. Fraudsters send official looking emails to
cardholders seeking information on their credit card accounts.
2.12.2.2 Fake Telephone Calls: Fraudsters through phone calls try to
wheedle out card details and particularly security code numbers also known as
card verification value.
2.12.2.3 Use of website that is not secure: Confidential information provided
by debit or credit card holders to the concerned website to make online
purchase may be hacked by internet fraudsters.
197
2.12.2.4 Misuse of website cookies: Some websites use cookies that provide
vital information about one’s habit and interest on internet. It can remember
personal information like password and other financial information. These are
misused by fraudsters.
2.12.2.5 Photo Copies Of Card: Copies of the front and back or having just
the numbers on both sides of the card are enough for making purchases online.
So a criminal no longer needs to clone the card or make a fake one.
2.12.2.6 Photograph of credit card: Fraudsters use mobile phones with built-
in digital cameras to take photo of credit cards and thereby try to get all
relevant details from a distance.
2.12.2.7 Misuse of credit card statement: Non – receipt of new or reissued
credit cards give rise to the highest incidents of fraud.
2.12.2.8 Misuse of carbon used in credit card charge slip: Some merchants
use the old EOC machines where the charge slip is generated in duplicate with
a carbon paper in between. This carbon paper is used to steal card details.
2.12.2.9 Misuse of charge slip: The credit card number and its expire date are
captured on charge slips and any person who gains access to the charge slip
does not normally need any more information for making online purchase.
2.12.2.10 Spoof letters or canvasses: We may receive a letter or fax
claiming that use are the sole benefactor of a recently deceased wealthy relative
or we may be told that we have own a lottery and the message goes on to
198
request bank details etc., All the information can be pieced together to
impersonate one.
2.12.2.11Skimming: Fraudsters engage front – end – offenders as sales
persons or low paid, unsupervised and transient workers in restaurants & petrol
pumps or shops to skim credit or debit card details from the magnetic strips
using a small machine made for this shady purpose.
2.12.3 ONLINE THREATS
A computer that stands connection to the internet is open to access by
clever hackers. Our virtual information may be misused by them. The IP
address of the computer and the details of browsing including pages visited and
the durations are not secrets.
2.12.3.1Trajan Viruses: Trojan virus is considered as one of the most
sophisticated types of malware programs created. These software programs
spread through computers usually when we open infected emails etc. They can
extract financial and other confidential information and send them to another
computer over the internet.
2.12.3.2Botnets: It is a parasitic program that hijacks a network and makes
other computer act on its instructions. The computers that are thus controlled
are known as ‘Zombies’ and or key tools in cyber warfare.
2.12.3.3Key Loggers: Another major tool of cyber warfare is key loggers
which are a software program or device designed to monitor and long all key
199
strokes. The key logger software scans computers and their processors and data
the moment a person strikers a key on the key board.
2.12.3.4Root Kits: It is a set of software tools that might have been installed
along with software package in computer perhaps it could have been injected in
to our operating system by an attacker.
2.12.3.5Worms: A worm is a piece of malicious software created to stealthily
infect computers in order to perform tasks.
2.12.4 OTHER TRICKY WAYS
Attackers may give false alarms about impending arrival of harmful
viruses to us by email. Free trail offers of software and services may be a ruse
to send viruses and exploit us. Yet another pitfall before netizens is the habit of
falling prey to tempting offers on the net. Sometimes, we may receive an email
that promises some software that could make out computer work faster or
downloads easier. It may be ruse to distribute viruses. Computers may get
infected when we visit certain undesirable website or when we open an email
from an unknown source.
2.12.5 INCREASING INCIDENTS OF FRAUDS IN INDIA
According to the kaspersky lab report those insidious email scams
known as phishing rose 87 percent worldwide in the year 2012.76
These
schemes affected some 37.3 million users around in the 12 months to April 30.
76 www.sify.com/news
200
The number of fraudulent websites and servers used in attacks has more than
tripled since 2012 and more than 50 percent of the total numbers of individual
targets were fake copies of the websites of banks and other credit card financial
organizations.
About 10,000 internet users in India face phishing attacks from cyber
criminals, daily- a report by security solutions provider kaspersky. In 2012-13
102,100 users around the world were subjected to phishing attacks on daily
basis. These numbers
were much lower in 2011-12.Over the period about 52,000 users globally were
subjected to phishing attacks on daily basis of which India accounted for
400077
. According to the report given by IT Minister to Rajyasabha the total
amount involved in frauds relating to credit card, debit card, net banking rose
74 percent to 38.4 crores in 2012.78
77 media.kaspersky.com/kasperskylab
78timesofindia.indiatimes.com
201
Table 2.11
BANK GROUP WISE TECHNOLOGY RELATED FRAUD
(NO. OF CASES IN ABSOLUTE TERMS AND AMOUNT INVOLVED IN RS.CRORE)
Bank Group
2009-10
2010-11
2011-12
2012-13
Cumulative total as
at end March 2013
No. of
cases
Amount
Involved
No. of
cases
Amount
Involved
No. of
cases
Amount
Involved
No. of
cases
Amount
Involved
No. of
cases
Amount
Involved
Nationalized
Banks
including
SBI Group
118 1.82 143 3.39 172 7.26 190 9.85 824 25.0
Old Private
Sector bank
9 0.15 4 0.46 9 0.06 6 1.09 55 2.30
New Private
Sector bank
14387 34.53 9638 21.41 6552 16.54 3408 33.97 74321 183.48
Sub Total 14396 34.68 9642 21.87 6561 16.6 3414 35.06 75200 211.38
Foreign
Banks
5273 26.88 4486 14.77 3375 74.60 5161 22.45 36455 145.95
Grand
Total
19787 63.38 14271 40.03 10048 38.46 8765 67.36 117655 357.33
Source: www.rbi.org.in
From the above it is evident that though the incidence of cyber frauds is
extremely high, the actual amount involved is generally very low. However, the
amount involved may be small from banker’s perspective; these are significant
from the view point of individuals who are victims of such frauds.
With cyber-attack becoming more frequent, RBI has advised banks in
February 2013 to introduce certain minimum checks and balances like
introduction of two factor authentication in case of ‘card not present’
transactions. Converting all strip based cards to chip based cards for better
security, issuing debit and credit cards only for domestic usage unless
specifically sought by the customer, putting threshold limit on international
usage of debit/credit cards, constant review of the pattern of card transaction in
202
coordination with customers, sending SMS alerts in respect of card transactions
etc., to minimize the impact of such attacks on banks as well as customers.
203
CHAPTER – III
SOCIO – ECONOMIC PROFILES OF E-BANKING
CUSTOMERS
3.1. INTRODUCTION
This chapter analyses the socio – economic profiles of the
respondents selected for the study. This chapter also analyses to
understand the other factors of e-banking users such as respondent’s
preference and reason for preferring e-banking products,
motivational factor that influenced them to select e-banking
products, facilities of e-banking used, number of years of utilization
and frequency of using e-banking facilities were also analyzed and
found out the results. Various tests were conducted to find out, if
there is any association between these variables.
The following socio-economic variables are considered to assess
the characteristics of e-banking customers of the study banks in the
study area (a) Sex (b) Age (c) Educational qualification (d)
Occupation (e) Monthly income and (f) Marital Status. Based on the
samples selected the descriptive and inferential analysis is as
follows.
204
3.2 DESCRIPTIVE ANALYSIS OF SAMPLES
Table 3.2.1
Gender-wise classification of respondents
Gender
Frequency
Percentage
Male
380
78.8
Female
102
21.2
Total
482
100
Source: Primary data
The above table shows the classification of e-banking users on the basis of
gender: 78.8 percent were male and 21.2 percent were female. It is concluded that the
majority of the respondents were male. The reason for the low proportion of female e-
banking users in the study area is the lack of awareness among them.
FIG 3.2.1.GENDER OF RESPONDENTS
78.8
21.2
0
10
20
30
40
50
60
70
80
90
1 2 3 4 5 6 7
Gender
Percentage
205
Table 3.2.2
Age-wise classification of respondents
Source: Primary data
The above table shows the various age groups of respondents selected for the
study. It reveals that 22.8 percent belongs to below 30 years group, 41.1 percent
belongs to 30-40 years age group, 24.7 percent to 40-50 years age group and 11.4
percent to above 50 years of age. It is concluded that majority of the respondents age
is up to 40 years. There is a lack of awareness among older age groups. Therefore, the
study banks should concentrate on creating awareness among them.
Age group
Frequency
Percentage
Below 30
110
22.8
30-40
198
41.1
40-50
119
24.7
Above 50
55
11.4
Total
482
100.0
0
10
20
30
40
50
1 2 3 4 5 6 7 8 9 10 11 12 13
22.8
41.1
24.7
11.4
FIG3.2.2 AGE OF RESPONDENTS
Age group Percentage
206
Table 3.2.3
Educational qualification of the respondents
Educational qualification
Frequency
Percentage
Graduate
132
27.4
Post Graduate
193
40.0
Doctorate
21
4.4
Professional
91
18.9
Others
45
9.3
Total
482
100.0
Source: Primary data
The above table shows the educational qualification of the respondents. It
shows that 40 percent of them are post graduates, 27.4 percent graduates, 18.9 percent
professionals, 4.4 percent doctorates and 9.3 percent are with other qualification. It is
concluded that the majority of the respondents were highly qualified.
207
Table 3.2.4
Occupational status of respondents
Occupation
Frequency
Percentage
Businessmen
58
12.0
Professionals
75
15.6
Government employee
157
32.6
Private employee
129
26.8
Retired person
28
5.8
Others
35
7.3
Total
482
100
Source: Primary data
The above table shows the occupational status of e-banking users selected for
the study. It is reveals that 12 percent are businessmen, 15.6 percent are professionals,
32.6 percent are government employees. 26.8 percent private employees, 5.8 percent
retired persons and the remaining 7.3 percent are in the category of others which
includes college students, house wives and farmers. It is concluded that majority of
the respondents in the study area were salaried people that is Government and Private
Employees.
208
Table 3.2.5
Monthly income-wise classification of respondents
Monthly income
Frequency
Percentage
Below 15,000
131
27.2
15,000-25,000
155
32.2
25,000-40,000
110
22.8
40,000-60,000
54
11.2
Above 60,000
32
6.6
Total
482
100.0
Source: Primary data
The above table shows the monthly income of respondents. It shows that 27.2
percent of e-banking users belongs to the group earning less than Rs.15,000, 32.2
percent to the Rs.15,000 – 25,000 category, 22.8, percent represents monthly income
between Rs.25,000 and Rs.40,000, 11.2 percent represents monthly income between
Rs.40,000 and Rs.60,000. It is concluded that majority of the e-banking users monthly
income is between Rs.15, 000 and Rs.25,000 which means majority of them are in
middle income group. So, the study banks should try to attract the higher income class
which lacks awareness in this area.
209
Table 3.2.6
Marital status of respondents
Marital status
Frequency
Percentage
Married
395
82.0
Unmarried
87
18.0
Total
482
100.0
Source: Primary data
The above table shows the respondents marital status. It reveals that 82
percent of the respondents were married and 18 percent unmarried. It is concluded
that the majority of respondents were married. So, the banks should encourage all
categories of the respondents to use e-banking products.
FIG : 3.2.5 MONTHLY INCOME OF
RESPONDENTS
27.2
32.2
22.8
11.26.6
0
510
15
20
2530
35
Below
15,0
00
25,000-
40,0
00
Abo
ve 6
0,00
0
Percentage
210
Table3.2.7
Classification of respondents on the basis of e-banking facilities
E-banking
facilities
SBI
ICICI
Total
Percentage
Frequency
Percentage
Frequency
Percentage
ATM
220
100.0
262
100.0
482
100.0
ATM-cum-
Debit card
220
100.0
262
100.0
482
100.0
Credit card
81
36.8
103
39.3
184
38.2
Net Banking
57
25.9
73
27.9
130
27.0
Mobile
Banking
25
11.4
29
11.1
54
11.2
NEFT
21
9.5
25
9.5
46
9.5
RTGS
18
8.2
22
8.4
40
8.3
Electronic
clearing
service(ECS)
19
8.6
13
4.9
32
6.6
Any Branch
Banking
28
12.7
20
7.6
48
10.0
Source: Primary data
The above table describes the e-banking products used by the respondents in
the study banks. It is evident that 100 percent of respondents are using ATM-cum-
Debit card and ATM facilities, 38.2 percent are using Credit Card, 27 percent are
using Net Banking facilities in the study bank. Out of 482 respondents 11.2 percent
are using mobile banking, 9.5 percent are NEFT, 8.3 percent are RTGS and 10.5
percent are using any branch banking facility. Only 6.6 percent are using Electronic
Clearing Service (ECS) facility. It is concluded that most of the respondents are multi-
product users. The percentage of users with respect to ATM-Cum-Debit Card, Credit
Card and Net banking is high and other products are used by few respondents only.
Hence, the study banks should create awareness about these products and facilities
among people in this area.
211
Table 3.2.8
Motivational factor to avail e-banking products
Motivators
Frequency
Percentage
Friends and relatives
166
34.4
Bank employees
131
27.2
Phone banking officers
43
8.9
Sales executives
54
11.2
Advertisement
66
13.7
Other factors
22
4.6
Total
482
100.0
Source: Primary data
The above table shows the factor which influenced the respondents to avail e-
banking facilities. It reveals that 34.4 percent were influenced by friends and relatives,
27.2 percent by bank employers, 8.9 percent by the phone banking officers, 11.2
percent by sales executives, 13.7 percent by advertisement, and 4.6percent by other
than these factors. It is concluded that majority of the respondents were motivated by
friends and relatives and also by bank employees.
212
Table 3.2.9
Number of years of utilization
Years
Frequency
Percentage
Less than 1 year
42
8.7
1-2 years
66
13.7
2-5 years
132
27.4
More than 5 years
242
50.2
Total
482
100.0
Source: Primary data
The above table reveals the number of years of e-banking facility usage by the
respondents. It shows that 8.7 percent are using e-banking facilities for less than one
year, 13.7 percent are for 1-2 years, 27.4 percent are for 2-5 years and 50.2 percent
are using for more than 5 years. It is concluded that majority of the respondents are
using e-banking facilities for more than 5 years.
FIG 3.2.9 NUMBER OF YEARS OF
UTILIZATION
8.713.7
27.4
50.2
213
Table 3.2.10
Preference of respondents to e-banking products
Preference
Frequency
Percentage
Yes
471
97.7
No
11
2.3
Total
482
100.0
Source: Primary data
The above table shows the respondents preference to use e-banking products.
It reveals that 97.7 percent of the respondents prefer to use e-banking products for
their banking transactions and only 2.3 percent don’t prefer e-banking products for
their transactions with bank. It is concluded that e-banking products are preferred by
respondents in the study banks.
FIG :3.2.10 PREFERENCE OF
RESPONDENTS TO E-BANKING
PRODUCTS
0
97.7
2.3
0
20
40
60
80
100
120
Prefe
renc
eYes No
214
Table 3.2.11
Reason for preference to e-banking products
Reasons
Frequency
Percentage
Convenience banking
160
34.0
No risk of carrying cash
92
19.5
Global access
30
6.4
Time saving
140
29.7
Easy Fund Transfer
49
10.4
Total
471
100.0
Source: Primary data
The above table shows the reason for preferring e-banking products. 34
percent prefer for convenience 29.7 percent for time saving, 19.5 percent prefer to
avoid risk of carrying cash, 10.4 percent easy fund transfer and 6.4 percent prefer for
global access. It is concluded that majority of the e-banking users prefer them for their
convenience as they save time for their banking operations quickly.
215
Table 3.2.12
Frequency of usage in the past three months
Number of times
Frequency
Percentage
Zero
21
4.4
1-5
75
15.6
5-15
199
41.3
15-30
119
24.7
30-50
40
8.3
>50
28
5.8
Total
482
100.0
Source: Primary data
The above table shows the respondents’ e-banking product usage for the past
three months. It reveals that 41.3 percent of the respondents used e-banking products
5-15 times in the past 3 months, 24.7 percent used 15-30 times, 15.6 percent 1-5
times, 8.3 percent 30-50 times, 5.8 percent used it more than 50 times and 4.4 percent
of the respondents were not used it in the past three months.
216
Table 3.2.13
Occupational status of Internet banking users
Occupation
Frequency
Percentage
Businessmen
46
35.4
Professionals
28
21.5
Government employee
27
20.8
Private employee
23
17.7
Retired person
2
1.5
Others
4
3.1
Total
130
100.0
Source Primary Data
The above table shows the classification of Internet banking users on the basis
of their occupation. It shows that 35.4 percent of the Internet banking users are
Businessmen, 21.5 percent are professionals, 20.8 percent are Government
employees, and 17.7 percent are private employees. It is concluded that internet
banking facilities are highly used by businessmen.
217
Table 3.2.14
Occupational status of credit card users
Occupation
Frequency
Percentage
Businessmen
23
12.5
Professionals
36
19.6
Government employee
69
37.5
Private employee
52
28.3
Retired person
0
0.0
Others
4
2.2
Total
184
100.0
Source: Primary data
The above table shows that out of the 184 credit card users 37.5 percent are
Government employers, 28.3 percent are private employees, 19.6 percent are
professionals and 12.5 percent are businessman. Credit cards are not used by retired
persons. It is concluded that majority of the credit card users are government and
private employees
218
Table 3.2.15
Occupational status of Mobile banking users
Occupation
Frequency
Percentage
Businessmen
4
7.4
Professionals
14
25.9
Government employee
18
33.3
Private employee
15
27.8
Retired person
2
3.7
Others
1
1.9
Total
54
100.0
Source: Primary data
The above table shows that among 54 mobile banking users 33.3 percent are
Government employees 27.8 percent are private employees, 25.9 percent
professionals and only 7.4 percent are businessmen. 3.7 percent of the mobile banking
users are retired person and 1.9 percent are in the category of others. It is concluded
that majority of the mobile banking users are Government and private employees.
219
Table3.2.16
Occupational status of EFT/NEFT users
Occupation
Frequency
Percentage
Businessmen
20
43.5
Professionals
11
23.9
Government employee
6
13.0
Private employee
7
15.2
Retired person
1
2.2
Others
1
2.2
Total
46
100.0
Source: Primary data
The above table reveals that 43.5 percent of the EFT/NEFT users are
businessmen, 23.9 percent professionals, 15.2 percent private employees, 13 percent
are government employees. It is concluded that EFT/NEFT is highly used by
businessmen.
220
Table 3.2.17
Occupational status of RTGS users
Occupation
Frequency
Percentage
Businessmen
28
70.0
Professionals
7
17.5
Government employee
2
5.0
Private employee
1
2.5
Retired person
1
2.5
Others
1
2.5
Total
40
100.0
Source: Primary data
The above table reveals the occupational status of RTGS users. 70 percent of
the RTGS users are businessmen. 17.5 percent are professionals, 5 percent are
Government employees. It is concluded that RTGS facilities are highly used by
businessmen. There is a lack of awareness among other people like Government
employees and Private employees. So the study banks should create awareness among
these people.
221
Table 3.2.18
Occupational status of ECS users
Occupation
Frequency
Percentage
Businessmen
11
34.4
Professionals
8
25.0
Government employee
6
18.8
Private employee
6
18.8
Retired person
1
3.1
Others
0
0.0
Total
32
100.0
Source: Primary data
The above table shows that among 32 ECS users 34.4 percent are
businessmen, 25.5 percent are professionals, 18.8 percent are Government and private
employees, the remaining 3.1 percent are retired person. It is concluded that majority
of the ECS users are businessmen.
222
Table 3.2.19
Occupational status of Any Branch Banking users
Occupation
Frequency
Percentage
Businessmen
6
12.5
Professionals
12
25.0
Government employee
13
27.1
Private employee
9
18.8
Retired person
6
12.5
Others
2
4.2
Total
48
100.0
Source: Primary data
The above table shows that among 48 Any branch banking users, 27.1 percent
are Government employees, 12.5 percent are businessmen and only 4.2 percent are
persons who fall under the category of others. It is concluded that majority of the any
branch banking users are Government employees and professionals.
223
Table 3.2.20
Monthly income- wise classification of Internet Banking users
Monthly income
(in Rs.)
Frequency
Percentage
Below 15,000
7
5.4
15,000-25,000
14
10.8
25,000-40,000
38
29.2
40,000-60,000
41
31.5
Above 60,000
30
23.1
Total
130
100.0
Source: Primary data
The above table shows the monthly income of internet banking users. It
reveals that 31.5 percent of internet banking users belong to the group earning
between Rs.40,000 and 60,000, 29.2 percent to the Rs.25,000 – 40,000, 23.1 percent
represent income group of above Rs.60,000, 10.8 percent represents income group of
Rs.15,000 – 25,000, and the remaining 5.4 percent represents income group of below
Rs.15,000. It is concluded that majority of the internet banking users belong to high
income group. So the study bank should attract other income class which lacks
awareness.
224
Table 3.2.21
Monthly income- wise classification of Credit card users
Monthly income
(in Rs.)
Frequency
Percentage
Below 15,000
12
6.5
15,000-25,000
79
42.9
25,000-40,000
65
35.3
40,000-60,000
19
10.3
Above 60,000
9
4.9
Total
184
100.0
Source: Primary data
The above table reveals that out of 184 credit card users 42.9 percent fall
under the income group of Rs.15, 000 – 25,000, 35.3 percent fall under Rs.25, 000 –
40,000 income group. 10.3 percent represents income group of Rs.40, 000 – 60,000,
4.9 percent represents above 60,000 and 6.5 percent represents below Rs.15, 000.
225
Table 3.2.22
Monthly income- wise classification of Mobile banking users
Monthly income
(in Rs.)
Frequency
Percentage
Below 15,000
5
9.3
15,000-25,000
19
35.2
25,000-40,000
23
42.6
40,000-60,000
7
13.0
Above 60,000
0
0.0
Total
54
100.0
Source: Primary data
The above table shows that majority of the mobile banking users, that is 42.6
percent belongs to income group of Rs.25,000 – 40,000, 35.2 percent to Rs.15,000 –
25,000, 13 percent to Rs.40,000 – 60,000, 9.3 percent belongs to below Rs.15,000
income group.
226
Table 3.2.23
Monthly income -wise classification of EFT/NEFT users
Monthly income
(in Rs.)
Frequency
Percentage
Below 15,000
2
4.3
15,000-25,000
3
6.5
25,000-40,000
15
32.6
40,000-60,000
19
41.3
Above 60,000
7
15.2
Total
46
100.0
Source: Primary data
The above table shows that 41.3 percent of the EFT/NEFT users belong to the
group earning between Rs.40,000 and Rs.60,000, 32.6 percent belongs to Rs.25,000 –
40,000 income group, 15.2 percent to above Rs.60,000 income group and 6.5 percent
to Rs.15,000 – 25,000 group. It is concluded that majority of the EFT/NEFT users are
in the high income group.
227
Table 3.2.24
Monthly income- wise classification of RTGS users
Monthly income
(in Rs.)
Frequency
Percentage
Below 15,000
2
5.0
15,000-25,000
1
2.5
25,000-40,000
3
7.5
40,000-60,000
12
30.0
Above 60,000
22
55.0
Total
40
100.0
Source: Primary data
The above table shows the income status of RTGS users. It shows that 55
percent of the RTGS users earn above Rs.60, 000 as monthly income, 30 percent
earns between Rs.40,000 and Rs.60,000. 7.5 percent earns between Rs.15, 000 and
Rs.25, 000 and 5 percent below Rs.15, 000. It is concluded that majority of the RTGS
users are in high income group.
228
Table 3.2.25
Monthly income- wise classification of ECS users
Monthly income
(in Rs.)
Frequency
Percentage
Below 15,000
1
3.1
15,000-25,000
7
21.9
25,000-40,000
11
34.4
40,000-60,000
5
15.6
Above 60,000
8
25.0
Total
32
100.0
Source: Primary data
The above table shows that 34.4 percent of ECS users belong to the group
earning between Rs.25,000 and 40,000, 25 percent belongs to above Rs.60,000
income group. 21.9 percent to Rs.15,000 – 25,000 group. 15.6 percent to Rs.40,000 to
60,000 group and only 3.1 percent belongs to below Rs.15,000 income group.
Therefore it is concluded ECS facilities are used by high and middle income group.
229
Table 3.2.26
Monthly income- wise classification of Any Branch Banking users
Monthly income
(in Rs.)
Frequency
Percentage
Below 15,000
10
20.8
15,000-25,000
17
35.4
25,000-40,000
12
25.0
40,000-60,000
7
14.6
Above 60,000
2
4.2
Total
48
100.0
Source: Primary data
The above table shows that out of 48 any branch banking users 35.4 percent
belong to the group earning between Rs.15,000 and 25,000, 25 percent belong to
Rs.25,000 – 40,000 group, 20.8 percent to below Rs.15,000 group, 14.6 percent to
Rs.40,000 – 60,000 income group and 4.2 percent belongs to above Rs.60,000 income
group. It is concluded that majority of the Any branch banking users fall under the
income group of Rs.15,000 – 25,000 .
230
Table 3.2.27
Respondents’ view on security of electronic delivery channels
View
Frequency
Percentage
Very much insecure
15
3.1
Somewhat insecure
46
9.5
Not sure
88
18.3
Somewhat secure
239
49.6
Very secure
94
19.5
Total
482
100.0
Source: Primary data
The above table reflects the respondents’ view on security of transactions done
through electronic delivery channels. It shows that 19.5 percent of the respondents
feel very secure with the electronic channels, 49.6 percent feel somewhat secure, 18.3
percent not sure, 9.5 percent feel somewhat insecure and 3.1 percent feel very much
insecure with the electronic channels. It is concluded that majority of the respondents
felt somewhat secure when they transact through electronic channels and not very
much secure. Hence the study banks should ensure the security of information and
privacy and try to make e-banking customer feel secure.
231
Table 3.2.28
Respondents’ view on ‘electronic channels have improved service level’
View
Frequency
Percentage
very untrue
7 1.5
Somewhat untrue
20 4.1
Not sure
56 11.6
Somewhat true
111 23.0
Vey true
288 59.8
Total
482 100.0
Source: Primary data
The above table reflects the view of e-banking customers on service level
improvement through electronic channels. 59.8 percent of the respondents accepted
that electronic channels have improved the service level, 23 percent of the
respondents said it is somewhat true, 11.6 percent are not sure, 4.1 percent said it is
somewhat untrue and 1.5 percent very untrue. It is concluded that majority of the
respondents agree that the introduction of electronic channels have improved the
service level of banks.
232
3.3 INFERENTIAL ANALYSIS ON SAMPLES
HYPOTHESIS- I
Null Hypothesis: There is no significant association between age and number of
Years of availing e-banking services
Table 3.3.1 Chi-Square test for association between age group and number of
year of Availing e-banking services
Age
group
(years)
Number of years of utility
Total
Chi-
square
value
P value
>1 1-2 2-5 >5
<30
8
(7.3)
30
(27.3)
40
(39.4)
32
(29.1)
110
42.535
0.000**
30-40
18
(9.1)
24
(12.1)
53
(26.8)
103
(52.0)
198
40-50
10
(8.4)
9
(7.6)
30
(25.2)
70
(58.8)
119
>50
6
(10.9)
3
(5.5)
9
(16.4)
37
(67.3)
55
Total
42
66
132
242
482
Note: The value within brackets refers to Row percentage.
Since P value is less than 0.01, the null hypothesis is rejected at 1% level of
significance. Hence there is an association between age and number of years of
availing e-banking services. It is concluded that the respondents in the age above 40
years were availing e-banking services for more periods than other age groups
233
HYPOTHESIS- II
Null Hypothesis: There is no significant association between occupation and
number of years of availing e-banking services.
Table 3.3.2 Chi-Square test for association between occupation and number of
Years of availing e-banking services.
occupation
Number of years utilization
Total
Chi-
square
value
P value
<1 1-2 2-5 >5
Businessman
4
(6.9)
6
(10.3)
13
(22.4)
35
(60.3)
58
20.435
0.156
Professional
6
(8.0)
12
(16.0)
18
(24.0)
39
(52.0)
75
Govt.
Employee
17
(10.8)
20
(12.7)
48
(30.6)
72
(45.9)
157
Private
employee
7
(5.4)
19
(14.7)
40
(31.0)
63
(48.8)
129
Retired
Person
2
(7.1)
2
(7.1)
3
(10.7)
21
(75.0)
28
Others
6
(17.1)
7
(20.0)
10
(28.6)
12
(34.3)
35
Total
42
66
132
242
482
Note: The value within brackets refers to Row percentage.
Since P value is greater than 0.05, the null hypothesis is accepted at 5% level
of significance. Hence there is no association between occupation and number of
years of availing e-banking services. It is concluded that occupational status does not
influence the duration of availing e-banking services in the study banks.
234
HYPOTHESIS-III
Null Hypothesis: There is no significant association between age group and
frequency of usage
Table 3.3.3 Chi-Square test for association between age group and frequency of
usage
Age
group
(years)
Frequency of usage
Total
Chi-
square
value
P
value
Zero
1-5
5-15
15-30
30-50
>50
<30
8
(7.3)
17
(15.5)
52
(47.3)
21
(19.1)
6
(5.5)
6
(5.5)
110
22.303
0.100
30-40
11
(5.6)
28
(14.1)
78
(39.4)
53
(26.8)
18
(9.1)
10
(5.1)
198
40-50
0
(0.0)
15
(12.6)
48
(40.3)
35
(29.4)
11
(9.2)
10
(8.4)
119
>50
2
(3.6)
15
(27.3)
21
(38.2)
10
(18.2)
5
(9.1)
2
(3.6)
55
Total
21
75
199
119
40
28
482
Note: The value within brackets refers to Row percentage.
Since P value is greater than 0.05, the null hypothesis is accepted at 5% level
of significance. Hence there is no association between age group and frequency of
using e-banking products. Hence the age does not influence the number of times
banking transaction done through electronic channels.
235
HYPOTHESIS-IV
Null Hypothesis: There is no significant association between occupation and
frequency of usage.
Table 3.3.4 Chi-Square test for association between occupation and frequency of
usage
Occupation
Frequency of usage
Total
Chi-
square
value
P value
zero
1-5
5-15
15-30
30-50
>50
Businessman
0
(0.0)
1
(1.7)
3
(5.2)
11
(19.0)
31
(53.4)
12
(20.7)
58
296.641
0.000***
Professional
2
(2.7)
4
(5.3)
28
(37.3)
33
(44.0)
4
(5.3)
4
(5.3)
75
Govt.
Employee
5
(3.2)
21
(13.4)
78
(49.7)
50
(31.8)
1
(0.6)
2
(1.3)
157
Private
employee
10
(7.8)
22
(17.1)
65
(50.4)
20
(15.5)
4
(3.1)
8
(6.2)
129
Retired
Person
1
(3.6)
11
(39.3)
14
(50.0)
1
(3.6)
0
(0.0)
1
(3.6)
28
Others
3
(8.6)
16
(45.7)
11
(31.4)
4
(11.4)
0
(0.0)
1
(2.9)
35
Total
21
75
199
119
40
28
482
Note: The value within brackets refers to Row percentage.
Since P value is less than 0.01 the null hypothesis is rejected at 1% level of
significance. Hence there is an association between occupation and frequency of using
e-banking products. It is concluded that businessmen are using e-banking products
more frequently than others.
236
HYPOTHESIS-V
Null Hypothesis: There is no significant association between monthly income and
frequency of usage
Table 3.3.5 Chi-Square test for association between monthly income and
frequency of usage
Monthly
income
(R.s)
Frequency of usage
Total
Chi-
square
value
P value
zero
1-5
5-15
15-30
30-50
>50
<15,000
122
(9.2)
41
(31.3)
70
(53.4)
5
(3.8)
0
(0.0)
3
(2.3)
131
297.223
0.000***
15,000-
25,000
5
(3.2)
22
(14.2)
84
(54.2)
36
(23.2)
2
(1.3)
6
(3.9)
155
25,000-
40,000
4
(3.6)
9
(8.2)
32
(29.1)
52
(47.3)
7
(6.4)
6
(5.5)
110
40,000-
60,000
0
(0.0)
2
(3.7)
11
(20.4)
24
(44.4)
11
(20.4)
6
(11.1)
54
>60,000
0
(0.0)
1
(3.1)
2
(6.3)
2
(6.3)
20
(62.5)
7
(21.9)
32
Total
21
75
199
119
40
28
482
Note: The value within brackets refers to Row percentage.
Since P value is less than 0.01, the null hypothesis is rejected at 1% level of
significance. Hence there is an association between monthly income and frequency of
using e-banking products. It is concluded that majority of the higher income group of
respondents are using e-banking products more frequently than lower income group.
237
SUMMARY
This chapter analyses the socio-economic profiles of the e-banking customers
of the study banks. The socio-economic variable such as sex, age, educational
qualification, occupational status, monthly income, marital status and other variables
like preference and reason for preferring e-banking products, motivational factors
influencing to select e-banking products, number of years of using e-banking products
and number of times banking transactions done through electronic channels for the
past 3 months by the respondents has been analyzed and found out the results.
Based on the samples selected the descriptive and inferential analyses are as
follows. The analyses reveal that out of 482 respondents, 78.8 percent were male and
21.2 percent females. It is concluded that the majority of the respondents were male.
The reason for the low proportion of female e-banking users is the lack of awareness
among them. Majority of the respondents (41.1%) using e-banking products belong to
30-40 years age group, 24.7 percent to 40-50 years, 22.8 percent to below 30 years,
and 11.4 percent belongs to above 50 years age group. The post graduates are the
largest (40%) among 482 e-banking users. The second largest users of e-banking
products are graduate (27.4) followed by 18.9 percent professionals, 9.3 percent
others and 4.4 percent doctorates.
The occupational status of e-banking product users reveal that 12 percent are
businessmen, 15.6 percent are professionals, 32.6 percent Government employees,
26.8 percent private employees, 5.8 percent retired person and the remaining 7.3
percent others category. It is concluded that the majority of the respondents were
salaried class. The monthly income of the respondents shows that 27.2 percent of the
e-banking product users belong to the income group less than Rs.15000 32.2 percent
to the Rs.15,000 – 25,000 category, 22.8 percent represent monthly income between
Rs.25,000 and 40,000, 11.2 percent between Rs.40,000 and 60,000, and 6.6 percent
more than Rs.60,000. It is concluded that majority of the e-banking product users’
monthly income is between Rs.15000 and Rs.25,000. The marital status shows that 82
percent of the respondents were married and 18 percent unmarried. It is concluded
that the majority of the respondents are married.
238
It is evident from the analyses that100 percent of respondents are using ATM
– cum - Debit card and ATM facilities. Out of 482 respondents, 38.2 percent are
credit card users, 27 percent net banking users, 11.2 percent mobile banking, 9.5
percent NEFT, 8.3 percent RTGS and 10.5 percent are any branch banking users and
only 6.6 percent are ECS users. It is concluded that most of the respondents are multi-
product users. E-banking facilities such as mobile banking, NEFT, RTGS ECS and
any branch banking are used by few respondents.
The analyses further reveals that the majority of respondents preference and
the reasons for preferring E-banking products show that 34 percent prefer for
convenience, 29.7 percent for time saving, 19.5 percent for avoiding risk of carrying
cash, 10.4 percent for easy transfer of funds, and 6.4 percent for easy global access. It
is concluded that E-banking products are preferred by them not only for convenience
and no risk of carrying cash but also for saving time of doing banking operations.
The motivational factors which influence the selection of e-banking products
shows that 34.4 percent were influenced by friends and relatives, 27,.2 percent by
bank employees, 13.7 percent by advertisement, 11.2 percent by sales executives, 8.9
percent by phone banking officers and 4.6 percent by other than these factors. It is
concluded that majority of respondents were motivated by friends and relatives and
bank employees.
The duration of using e-banking products reveals that 50.2 percent are using
for more than 5 years, 27.4 percent for 2-5 years., 13.7 percent for 1-2 years and 8.7
percent for less than one year. It is concluded that majority of the respondents are
using e-banking products for more than five years. The analyses also reveals that
majority (41.3%) of the respondents used electronic channels 5-15 times for banking
operation in the past three months. 15-30 times are used by 24.7 percent of the
respondents, 1-5 times by 15.6 percent, 30-50 times by 8.3 percent, more than 50
times by 5.8 percent and 4.4 percent of the respondents were not used e-banking
products for the past three months.
The analyses also reveals that internet banking facilities are highly used by
businessmen as 35.4 percent of the internet banking users are businessmen, 21.5
percent are professionals, 20.8 percent Government employees and 17.7 percent
private employees. Majority of the credit card users are Government employees
239
(37.5%) and private employees (28.3%). RTGS and NEFT facilities are highly used
by businessmen and majority of the internet banking users belong to high income
group whereas 42.9 percent of the credit card users fall under the income group of
Rs.15,000 – Rs.25,000. Majority of the mobile banking users that is 42.6 percent
belong to income group of Rs.25, 000 - 40,000..
The analyses reflect the view of respondent on security of transactions done
through electronic channels. 19.5 percent feel very secure with the electronic channels
49.6 percent somewhat secure, 9.5 percent somewhat insecure and 3.1 percent feel
very much insecure with the electronic channels. The analyses also reveals that
majority of the respondents (59.8%) accept that electronic channels have improved
the service level.
The Hypothesis No I and II - tests was conducted for assessing if there is an
association between age, occupation and the number of years of availing e-banking
services. It reveals that there is an association between age group and numbers of
years of availing e-banking services and it is concluded that the respondents in the age
group of above 40 years were availing e-banking services for more periods than other
age group. Further the test reveals that there is no association between occupation and
number of years of availing e-banking services.
The Hypothesis No III, IV and V - tests was conducted to find out if there is
an association between age, occupation, monthly income and frequency of using e-
banking products. It reveals that there is no association between age and frequency of
usage but there is an association between occupation and frequency of using e-
banking products and it is concluded that businessmen are using e-banking products
more frequently than others. Further it reveals that there is an association between
monthly income and frequency using e-banking products and majority of the higher
income group of respondents are using e-banking product more frequently than lower
income group. It is concluded that the study banks should adopt appropriate strategy
to encourage lower income group to use e- channels or e-banking products for
banking operations.
240
CHAPTER – IV
AWARENESS AND UTILITY OF E-BANKING SERVICES
4.1. Introduction
The traditional provision of financial and banking services and products is
being replaced with innovative ways of providing these services. Such an innovative
way is the electronic banking. Technology has enabled a wide array of banking
products and services being made available to retail and wholesale customers through
electronic distribution channels. The banks in India provide wide range of services
through electronic banking. With the introduction of electronic banking, banking
operations have become faster, accurate and time consuming. E-banking has brought
to the customers the much demanded convenience, but customers may or may not
aware of the various services offered within each e-banking product. The banks
providing e-banking services need to provide necessary information regarding their
products and services to their customers. The growth and development of any product
depends upon its usage by the customer. In the same way the development of e-
banking products depends upon the utilization of such products by customers. The
awareness and utilization are the two important factors or measurements to measure
the penetration of e-banking products.
This chapter discusses to test whether the e-banking customers are aware of
the services provided through e-banking products, or not, if aware whether they utilize
it or not and if there is any association between awareness and socio-economic profile
of the customers and also between utilization.
The e-banking products which provide multiple services are only taken for
analyses such as ATM cum debit card, credit card, Internet banking, mobile banking
and any branch banking. The services of each product have been classified in to
groups. Based on the classification, customers’ awareness and utilization were
evaluated by using yes/no pattern, giving one point for yes response and zero for no
response. Multiple response analysis has been used to analyze the awareness and
utilization of e-banking services by the customers.
241
CATEGORIES OF E-BANKING PROEUCTS AND SERVICES
The services of e-banking products were categorized under the following heads for
analysis purpose.
I. ATM – cum – Debit Card
a) Convenience services at ATM ; (8 services)
(1) Balance enquires (2) Withdrawal of cash (3) Deposit of Cash/Cheque (4)
Obtain statement of account (5) Cheque book request (6) Change of PIN
(7) Fast cash (8) Shared ATM.
b) Value added service at ATM (9 Services)
(1) Fund transfer between same bank/branch (2) card to card transfer (3) Card
to account transfer (4) Credit card bill payment (5) Insurance payment (6)
Holy and Trust Donation (7) Educational fee payment (8) mobile top-ups
(9) Air ticket payment.
c) Debit card services at POS : (6 Services)
(1) Payment for purchases at POS (2) SMS alert on POS transactions (3) Cash
withdrawal at POS (4) Attractive discount (5) Surcharge waiver (6)
Reward points.
d) Other Services (6 services)
(1) Operate multiple account with single debit card (2) Personal accident cover (3)
Lost card liability cover (4) purchase protection (5) Online utility bill payment
(6) online purchases.
II. Internet banking
a) Convenience services (12 servicers)
(1) Access account information (2) Bill payment and presentment (3) Bank
statement by email. (4) Inter branch fund transfer between own a/c (5) Inter
branch fund transfer (third party a/c) (6) Transfer to any bank a/c. (7)RTGS
payment instruction (8) Apply for debit card (9) Intimate about loss of ATM card
242
(10) Open deposit account (11) Cheque status enquiry (12) Apply for phone
banking (12) Apply for bank products.
b. Value added services: (9 services)
(1). Linking bank a/c and credit card a/c (2) Linking bank a/c and Demat a/c
(3) Access credit card details (4) Access Demat account details (5) online air
ticket booking (6) Online Railway ticket booking (7) Income, service and
excise duty payment (8) Online custom duty payment (9) Online shopping.
III. Mobile banking:
a) Information Based Services (11 services)
(1) Balance enquiry (2) Last 5 transaction details (3) Cheque book request (4)
Cheque states enquiry (5) Stop cheque request (6) Get credit card account
details (7) Get demat a/c details (8) Loan a/c details (9) Locate branch
ATM (10) Apply for bank product (11) Status of service request.
(b) Financial Transaction based Services:( Three Services)
(1) Bill Payment (2) Fund Transfer (3) Prepaid mobile recharge.
IV. Credit Card
a) Convenience Services : (13 services)
(1) Cash withdrawal at ATM (2) Cash advance at cash points (3) Online
Shopping (4) Online railway ticket booking (5) E-Statement (6) SMS alert
(7) Utility bill payment (8) online management of card (9) Auto debit
facility (10) Payment option – cash/cheque/draft (11) Payment through
ATM (12) Payment through ECS (13) Drop box facility.
b. Value added services: (4 services)
(1) Balance transfer facility (2) Dial – a-draft facility (3) Personal loan on
card (4) Interest free credit period
243
c. Benefit Services (10 services)
(1) Add on card facility (2) Temporary credit limit enhancement (3)
Permanent credit limit entrancement (4) Self – set/monthly preset credit limit
(5) Limited lost card liability (6) Revolving credit facility (7) Cash back offer
(8) Discount (9) Reward points (10) Fuel surcharge waiver.
d) Insurance Services (5 services)
1. Personal accident cover (2) Credit shield cover (3) life insurance on card
holders (4) Life insurance on add- on card (5) Purchase protection.
V. Any Branch banking (7 services)
Deposit of cash at non-home branch (2) Deposit of cheque and clearing
instrument (3) Cash withdrawal at non-home branch (4) Balance enquiry at
non-home branch (5) Get statement of a/c (6) Pass book updating (7) Fund
transfer to third party a/c at another CBS branch.
244
4.2 DESCRIPTIVE ANALYSIS OF SAMPLES
The descriptive analyses of samples with respect to awareness are as
follows.
Table 4.2.1
Multiple Response Analysis of Awareness towards
Convenience services at ATM
Convenience services
at ATM
ICICI SBI
Response Percent
of cases
Response Percent
of cases N Percent N percent
Balance enquiry
262
15.3%
100.0%
220
16.6%
100.0%
Withdrawal of cash
262
15.3%
100.0%
220
16.6%
100.0%
Deposit of cash/cheque
202
11.8%
77.1%
99
7.5%
45.0%
Obtain statement of
Account
209
12.2%
79.8%
204
15.4%
92.7%
Cheque book request
121
7.1%
46.2%
35
2.6%
15.9%
Change of PIN
250
14.6%
95.4%
194
14.7%
88.2%
Fast cash
170
9.9%
64.9%
137
10.3%
62.3%
Shared ATM
240
14.0%
91.6%
215
16.2%
97.7%
Total
1716
100.0%
655.0%
1324
100.0%
601.8%
Source: Primary data
The above table shows the awareness of ATM – cum debit card users with
respect to convenience services at ATM. From the sample of 262 ICICI bank ATM -
cum - debit card users all users accepted that they are aware of convenience service
provided at ATM. Inspection of the multiple dichotomy analysis frequency table 4.2.1
245
for multiple dichotomus set indicate that 100 percent of the ICICI bank respondents
are aware of basic convenience services such as balance enquiry and cash withdrawal,
77.1 percent deposit of cash 46.2 percent cheque book request, 64.9 percent fast cash
and 79.8 percent of the ATM – cum – Debit card uses are aware of obtain statement
of account service. It is concluded that majority of the ICICI bank’s ATM – cum
deposit card users are aware of convenience services provided at ATM.
In SBI 220 ATM – cum – Debit card users accepted that they are aware of
convenience service. From the 220 ATM – cum – Debit card users 100 percent of
them are aware of balance enquiry and cash withdrawal which are the basic services.
45 percent aware of cash deposit facility at ATM, 92.7 percent obtain statement of
account. 15.9 percent cheque book request, 88.2 percent change of PIN and 62.3
percent aware of fast cash facility. It is concluded that majority of SBI bank ATM –
cum - Debit card users are aware of convenience services provided at ATM.
246
Table 4.2.2
Multiple Response Analysis of Awareness towards
Value added services at ATM
Value added
services at ATM
ICICI SBI
Response Response
N
Percent
Percent
of cases
N
percent
Percent
of cases
Fund transfer
between same
bank/branch
142 15.9% 63.4% 157 22.9% 93.5%
Card to card
transfer
101 11.3% 45.1% 96 14.0% 57.1%
Card to account
transfer
62 7.0% 27.7% 43 6.3% 25.6%
Credit card bill
payment
169 18.9% 75.4% 85 12.4% 50.6%
Insurance
payment
114 12.8% 50.9% 94 13.7% 56.0%
Holy and trust
donations
45 5.0% 20.1% 50 7.3% 29.8%
Educational fee
payment
15 1.7% 6.7% 45 6.6% 26.8%
Mobile Top-ups
156 17.5% 69.6% 84 12.2% 50.0%
Air ticket
payment
88 9.9% 39.3% 32 4.7% 19.0%
Total
892 100.0% 398.2% 686 100.0% 408.3%
Source: Primary data
The above table shows the awareness of ATM – cum - Debit card users
towards value added services. From the 262 ICICI bank’s ATM – cum – Debit card
users, only 224 users accepted that they are aware of values added service. Among the
224, 63.4 percent are aware of fund transfer, 45.1 percent card to card transfer, 75.4
247
percent aware of credit card bill payment, 50.9 percent Insurance payment facility,
20.1 percent are aware holy and trust donation facility , 69.6 percent aware of mobile
top up facility, and 6.7 percent aware of education fee payment through ATM. It is
concluded that majority of the ATM users are awareness of the value added services
and the services that are known to few customers card to account transfer, educational
fee payment, Holy and trust donation facilities at ATM.
In SBI out of 220 ATM – cum – debit card users only 168 users accepted that
they are aware of value added services. Among 168, 93.5 percent aware of fund
transfer facility, 57.1 percent card to card transfer, 50.6 percent credit and bill
payment service, 56 percent Insurance payment service, 29.8 percent Holy and trust
donation facility, 26.8 percent educational fee payment service. It is concluded that
majority of the ATM users are aware of value added services and the services that are
known to few customers are card to account transfer, educational fee payment and
holy and trust donations services through ATM.
248
Table 4.2.3
Multiple Response Analysis of Awareness towards
Debit card services at POS
Debit card services at
POS
ICICI SBI
Response Percent
of cases
Response
N
Percent
N
percent Percent
of cases
Payment for purchases
at POS
258 25.6% 99.6% 219 28.0% 100.0%
SMS alert on POS
transaction
237 23.5% 91.5% 207 26.5% 94.5%
Cash withdrawal at
POS
124 12.3% 47.9% 63 8.1% 28.8%
Attractive discount
118 11.7% 45.6% 77 9.9% 35.2%
Surcharge waiver
102 10.1% 39.4% 56 7.2% 25.6%
Reward points
168 16.7% 64.9% 159 20.4% 72.6%
Total
1007 100.0% 388.8% 781 100.0% 356.6%
Source: Primary data
The above table shows the awareness of e-banking customers towards debit
card services at point of sales. From the sample of 262 ICICI banks’ ATM- cum-
Debit card users 258 respondents accepted that they are aware of debit card services at
point of sale. Among 258, 91.5 percent aware of SMS alert facility, 47.9 percent cash
withdrawa1 facility, 45.6 percent aware of discounts, 39.4 percent surcharge waiver
and 64.9 percent are aware of reward points. It is concluded that majority of the
customers are aware of services provided at point of sale. However the services
known to least numbers of customers are cash withdrawal facility at point of sale and
attractive discount.
In SBI bank, 219 ATM-cum-Debit card users accepted that they are aware of
services available at point of sales. Among 219 respondents, 94.5 percent are aware of
SMS alert on POS transaction, 28.8 percent cash withdrawal at POS, 35.2 percent
249
aware of discount, 25.6 percent aware of surcharge waiver, and 72.6 percent aware of
reward points. It is concluded that majority of the customers are aware of SMS alert
service and reward point. Other services are known to few respondents. Hence the
bank should take necessary steps to create awareness and promote its services for
higher customer satisfaction.
Table 4.2.4
Multiple Response Analysis of Awareness towards
Other services of Debit card
Other services of
Debit card
ICICI SBI
Response Percent
of cases
Response
N
Percent
N
percent Percent
of cases
Operate multiple
account with single
debit card
145 16.6% 57.3% 127 16.7% 59.6%
Personal accident
cover
88 10.1% 34.8% 54 7.1% 25.4%
Lost card liability
cover
120 13.8% 47.4% 100 13.2% 46.9%
Purchase
protection
50 5.7% 19.8% 69 9.1% 32.4%
Online utility
payment
221 25.3% 87.4% 207 27.3% 97.2%
Online purchase
248 28.4% 98.0% 202 26.6% 94.8%
Total
872 100.0% 344.7% 759 100.0% 356.3%
Source: Primary data
The above table shows the awareness of E-banking customers towards other
services of debit cards. 253 respondents from ICICI bank are aware of these services.
Among 253 respondents, 57.3 percent are aware of operation of multiple account with
single card, 98 percent online purchase, 87.4 percent online utility bill payment
service, 34.8 percent personal accident cover and 47.4 percent aware of lost card
250
liability cover and only 19.8 percent aware of purchase protection service. It reveals
that the services that are highly known to customers are online utility bill payment and
online purchases.
In case of SBI bank, 213 respondents are aware of these services. Among 213
respondents,97.2 percent aware of online utility bill payment service, 94.8 percent
online purchases, 59.6 percent aware of operating multiple account with single debit
card, 25.4 percent personal accident cover, 46.9 percent lost card liability cover and
32.4 percent aware of purchase protection facility. It reveals that the e-banking
customers are highly aware of online utility bill payment and online purchase facility.
251
Table 4.2.5
Multiple Response Analysis of Awareness towards
Convenience services of internet banking
Convenience services of
internet banking
ICICI SBI
Response Percent
of cases
Response
N
Percent
N
percent Percent
of cases
Access account
information
73 10.3% 100.0% 57 10.5% 100.0%
Bill payment and
presentment 70 9.9% 95.9% 57 10.5% 100.0%
Bank statement by e-
70 9.9% 95.9% 55 10.1% 96.5%
Inter branch fund
transfer(own account)
69 9.8% 94.5% 56 10.3% 98.2%
Inter branch fund
transfer(third party a/c)
70 9.9% 95.9% 56 10.3% 98.2%
Transfer to any bank a/c
50 7.1% 68.5% 46 8.5% 80.7%
RTGS payment
instruction
48 6.8% 65.8% 33 6.1% 57.9%
Apply for debit card
42 5.9% 57.5% 34 6.3% 59.6%
Intimate about loss of
ATM
card
62 8.8% 84.9% 52 9.6% 91.2%
Open deposit account
38 5.4% 52.1% 20 3.7% 35.1%
Cheque status enquiry
43 6.1% 58.9% 33 6.1% 57.9%
Apply for phone
banking
33 4.7% 45.2% 15 2.8% 26.3%
Apply for bank products
38 5.4% 52.1% 28 5.2% 49.1%
Total
706 100.0% 967.1% 542 100.0% 950.9%
Source: Primary data
252
The above table shows the awareness of internet banking customers towards
convenience services of net banking. 95.9 percent of the net banking users are aware
of bill payment service, 95.9 percent statement of account through email facility, 94.5
percent inter branch fund transfer (own a/c) 95.9 percent fund transfer (third party a/c)
68.5 percent aware of transfer to any bank a/c, 52.1 percent open deposit account and
52.1 percent of the net banking customers are aware of apply for bank products
facility through net. It reveals that majority of the internet banking users of ICICI
bank are aware of convenience services offered.
In case of SBI bank, out of 57 internet banking users 100 percent are aware of
bill payment service, 98.2 percent aware of inter branch fund transfer (own a/c), 98.2
percent aware of inter branch fund transfer (third party a/c), 80.7 percent aware of
transfer to any bank a/c services, 35.1 percent aware of apply for bank products
through net banking. It reveals that majority of the internet banking users of SBI are
aware of many convenience services offered.
253
Table 4.2.6
Multiple Response Analysis of Awareness towards
Value added services of internet banking
Value added
services of internet
banking
ICICI SBI
Response Percent
of cases
Response
N Percent N percent Percent of
cases
Linking bank a/c
and credit card a/c 28 7.2% 40.6% 17 6.6% 30.9%
Linking bank a/c and
Demat a/c 21 5.4% 30.4% 13 5.0% 23.6%
Access credit card
details
39 10.0% 56.5% 22 8.5% 40.0%
Credit card related
service request
35 9.0% 50.7% 20 7.8% 36.4%
Access Demat
account details 20 5.1% 29.0% 13 5.0% 23.6%
Online Air ticket
booking
59 15.1% 85.5% 36 14.0% 65.5%
Online Railway
ticket booking 69 17.7% 100.0% 55 21.3% 100.0%
Income, services
&Excise Duty
payment
42 10.8% 60.9% 24 9.3% 43.6%
Online custom duty
payment 12 3.1% 17.4% 7 2.7% 12.7%
Online shopping
65 16.7% 94.2% 51 19.8% 92.7%
Total
390 100.0% 565.2% 258 100.0% 469.1%
Source: Primary data
The above table shows the internet banking customers’ awareness towards
value added services of internet banking. Out of 73 internet banking users of ICICI
bank, 69 users are aware of value added services offered by ICICI bank. 100 percent
of them are aware of online train ticket booking, 85.5 percent Air ticket booking, 94.2
percent online shopping, 60.9 percent income tax, services and excise duty payment
service, 56.5 percent aware of credit card details access through net, 40.6 percent
linking of bank account and credit card account and only 30.4 percent aware of
254
linking bank account with demat account service. It reveals that ICICI bank’s internet
banking customers are highly aware value added services such as train ticket booking,
Air ticket booking. Income and service tax payment, and online shopping facility.
Other value added services such as access demat account details, linking of demat
account, online custom duty payment are not popular among customers in this area of
study.
In case of SBI bank, out of 57 internets banking users 55 respondents accepted
that they are aware of value added services of internet banking. 100 percent are aware
of online train ticket booking service, 65.5 percent air ticket booking, 92.7 percent
aware of online shopping 43.6 percent aware of income and service tax payment
service, 40 percent credit card details access through internet service, 30.9 percent
linking of bank account and credit card a/c, and only 23.6 percent aware of linking
bank a/c with demat a/c service. It reveals that SBI bank internet banking customers
are highly aware of few value added services such as train ticket booking, Air ticket
booking, and online shopping. Other services are net popular among internet banking
customers in this area of study.
So, the study banks should adopt right strategy to promote their value added
services in this area of study for higher penetration of net banking.
255
Table 4.2.7
Multiple Response Analysis of Awareness towards
Information based services of mobile banking
Information based
services of mobile
banking
ICICI SBI
Response Percent
of cases
Response
N
Percent
N
percent Percent of
cases
Balance enquiry
29 14.8% 100.0% 25 14.5% 100.0%
Last 5 transaction
details
29 14.8% 100.0% 25 14.5% 100.0%
Cheque book
request
16 8.2% 55.2% 17 9.9% 68.0%
Cheque status
enquiry
18 9.2% 62.1% 24 14.0% 96.0%
Stop cheque request
9 4.6% 31.0% 7 4.1% 28.0%
Get credit card
account details 19 9.7% 65.5% 15 8.7% 60.0%
Get Demat account
details
4 2.0% 13.8% 9 5.2% 36.0%
Loan account details
11 5.6% 37.9% 11 6.4% 44.0%
Locate branch/ATM
28 14.3% 96.6% 23 13.4% 92.0%
Apply for bank
product
11 5.6% 37.9% 2 1.2% 8.0%
Status of service
request
22 11.2% 75.9% 14 8.1% 56.0%
Total
196 100.0% 675.9% 172 100.0% 688.0%
Source: Primary data
The above table shows the awareness of mobile banking customers towards
information based services of mobile banking. Among 29 mobile banking users of
ICICI bank, 100 percent of them are aware of balance enquiry service, 75.9 percent
status of service request, 96.6 percent locate branch / ATM through mobile , 65.5
percent aware of access credit card details service, 62 percent cheque status enquiry,
256
and only 31 percent aware of stop cheque request service. It reveals that services such
as apply for bank product (37.9%), stop cheque request (31%) get demat a/c details
(13.8), and loan a/c details (37.9%) are not popular among customers of ICICI bank.
In case of SBI bank, 100 percent of the respondents are aware of services such
balance enquiry and get last five transaction details, 96 percent aware of cheque status
enquiry, 92 percent locate branch / ATM through mobile, 68 percent aware of cheque
book request service. It reveals that services such as apply for bank products (8%)
stop cheque request (28%), demat a/c details (35%) and loan a/c details (44%) are not
popular among SBI customers.
So, the study banks should take necessary steps to popularize the services
through appropriate medium and promote their value added services of mobile
banking for higher penetration of mobile banking services.
257
Table 4.2.8
Multiple Response Analysis of Awareness towards
Financial transaction based services of mobile banking
Financial
transaction based
services
ICICI SBI
Response Percent
of cases
Response
N
Percent
N
percent Percent
of cases
Bill payment 19 34.5% 73.1% 14 36.8% 73.7%
Fund transfer
19 34.5% 73.1% 16 42.1% 84.2%
Prepaid mobile
recharge
17 30.9% 65.4% 8 21.1% 42.1%
Total
55 100.0% 211.5% 38 100.0% 200.0%
Source: Primary data
The above table shows the awareness of mobile banking customers towards
transaction based services offered. It shows 73.1 percent of ICICI mobile banking
customers are aware of bill payment and fund transfer services offered through
mobile, 65 percent aware of prepaid mobile recharge facility. It reveals that majority
of the mobile banking users are aware of financial transaction based services.
In case of SBI bank’s Mobile banking customers, 73.7 percent are aware of
bill payment service, 84.2 percent fund transfer service and only 42.1 percent aware
of prepaid mobile recharge services through mobile. It reveals that prepaid mobile
recharge through mobile banking is not popular among SBI bank’s mobile banking
customers.
258
Table 4.2.9
Multiple Response Analysis of Awareness towards
Convenience services of credit card
Convenience services
of credit card
ICICI SBI
Response Percent
of cases
Response
N
Percent
N
percent Percent
of cases
Cash withdrawal at
ATM
103 10.2% 100.0% 81 10.3% 100.0%
Cash advance at cash
point
59 5.8% 57.3% 36 4.6% 44.4%
Online shopping
103 10.2% 100.0% 78 9.9% 96.3%
Online Railway ticket
booking 99 9.8% 96.1% 76 9.7% 93.8%
E-statement
63 6.2% 61.2% 43 5.5% 53.1%
SMS alert
98 9.7% 95.1% 79 10.1% 97.5%
utility bill payment
75 7.4% 72.8% 77 9.8% 95.1%
Online management
of card
48 4.7% 46.6% 17 2.2% 21.0%
Auto debit facility
51 5.0% 49.5% 44 5.6% 54.3%
Payment option –
cash/cheque/draft
102 10.1% 99.0% 81 10.3% 100.0%
Payment through
ATM
81 7.9% 78.6% 63 8.0% 77.8%
Payment through
ECS
29 2.8% 28.2% 29 3.7% 35.8%
Drop box facility
103 10.2% 100.0% 81 10.3% 100.0%
Total
1014 100.0% 984.4% 785 100.0% 969.1%
Source: Primary data
The above table shows the awareness of credit card holders towards
convenience services of credit card. It indicates that services such as cash withdrawal
259
at POS (100%) online shopping (100%), online railway ticket booking (96.1%), SMS
alert (95.1%), payment through ATM (78.6), E-statement (61.2%) and drop box
facility (100%) are the well-known services of credit card provided by ICICI bank. At
the same time services such as payment of credit card bill through ECS (28.2%),
online management of card (46.67) auto debit facility (49.5%) cash advance at cash
point (57.3%) are not popular services. So, the bank should create awareness about
these services through appropriate promotional strategy.
Among the 81 credit card holders of SBI bank, 100 percent of them are aware
of cash withdrawal at ATM and drop box facilities .97.5 percent aware of SMS alert
service, 96.3 percent online shopping, 93.8 percent online railway ticket booking,
77.8 percent payment of credit card bill through ATM. Services such as payment of
credit card bill through ECS(35.8%), online management of card (21%) cash advance
at cash point (44.4%), and auto debit facility (54.3%) are not popular services among
credit card holders of SBI.
260
Table 4.2.10
Multiple Response Analysis of Awareness towards
Value added services of credit card
Value added services
of credit card
ICICI SBI
Response Percent
of cases
Response
N
Percent
N
Percent Percent
of cases
Balance transfer
facility
42 23.9% 48.3% 15 15.8% 27.8%
Dial –a- Draft facility
31 17.6% 35.6% 22 23.2% 40.7%
Personal loan on card
22 12.5% 25.3% 7 7.4% 13.0%
Interest free credit
period
81 46.0% 93.1% 51 53.7% 94.4%
Total
176 100.0% 202.3% 95 100.0% 175.9%
Source: Primary data
The above table reflects the awareness of credit cardholders towards value
added services of credit card. 87 respondents of ICICI bank accepted that they are
aware of value added services of credit card. Among 87 respondents, 93.1 percent
aware of balance transfer facility, 35.6 percent dial-a-draft facility, 25.3 percent
personal accident cover, and 93.1 percent aware of interest free credit period. It
reveals that the percentage of cardholders aware of value added services such as
balance transfer, dial-a-draft, personal loan on cards is low. So the ICICI bank should
adopt proper promotional strategy to popularize and create awareness among
cardholders.
In case of SBI, 54 cardholders accepted that they are aware of value added
services of credit card. Out of 54 cardholders, 94.4 percent aware of interest free
credit period, 40 percent dial-a draft facility, 27.8 percent balance transfer facility, and
13 percent aware of personal loan on card. It reveals that majority of the customer are
not aware of value added services.
So, the SBI bank should adopt proper promotional strategy and create
awareness with respect to value added service among cardholders.
261
Table 4.2.11
Multiple Response Analysis of Awareness towards
Benefit services of credit card
Benefit services of
credit card
ICICI SBI
Response Percent
of cases
Response
N
Percent
N
Percent Percent
of cases
Add on card facility
97 18.5% 95.1% 64 22.3% 81.0%
Temporary credit
limit enhancement 51 9.7% 50.0% 12 4.2% 15.2%
Permanent credit
limit enhancement 49 9.3% 48.0% 12 4.2% 15.2%
Self-set/monthly
preset limit 34 6.5% 33.3% 15 5.2% 19.0%
Limited lost card
liability
56 10.7% 54.9% 8 2.8% 10.1%
Revolving credit
facility
66 12.6% 64.7% 51 17.8% 64.6%
Cash back offer
28 5.3% 27.5% 31 10.8% 39.2%
Discount
36 6.9% 35.3% 10 3.5% 12.7%
Reward points
75 14.3% 73.5% 70 24.4% 88.6%
Fuel surcharge
waiver
33 6.3% 32.4% 14 4.9% 17.7%
Total
525 100.0% 514.7% 287 100.0% 363.3%
Source: Primary data
The above table shows the awareness of credit card holders towards benefit
services of credit cards. Out of 103 credit card holders of ICICI bank, 102 accepted
that they are aware of benefit services. Among 102 cardholders, 95.1 percent are
aware of add on card facility, 73.5 percent reward points, 64.7 percent revolving
credit facility , 54.9 percent aware of limited lost card liability, 50 percent aware of
temporary credit limit enhancement. The services such as permanent credit limit
enhancement (48%), self-set/monthly preset limit, cash back offer (27.5%) discount
(36.3%), and fuel surcharge waiver (32.4) are not much popular services.
262
In case of SBI, 79 credit card holders accepted that they are aware of benefit
services of credit card offered by SBI. Among 79 cardholders, 81 percent are aware of
add on card facility, 88.6 percent reward points and 64.6 percent revolving credit
facility. The percentage of cardholders aware of other benefit services are not high
such as temporary credit limit (15.2%), permanent credit limit (15.2%), Limited lost
card liability (10.1%), Discount (12.7%) and self-set/monthly preset limit (19%). So
the banks particularly SBI should create awareness about benefit services of credit
card to achieve higher penetration and satisfaction. Otherwise it will lose market
share.
Table 4.2.12
Multiple Response Analysis of Awareness towards
Insurance services of credit card
Insurance services of
credit card
ICICI SBI
Response Percent
of cases
Response
N
Percent
N
Percent Percent
Personal accident cover
38 17.8% 53.5% 28 17.2% 49.1%
Credit shield cover
49 23.0% 69.0% 52 31.9% 91.2%
Life insurance on
cardholder
56 26.3% 78.9% 32 19.6% 56.1%
Life insurance on add on
card 45 21.1% 63.4% 10 6.1% 17.5%
Purchase protection
25 11.7% 35.2% 41 25.2% 71.9%
Total
213 100.0% 300.0% 163 100.0% 286.0%
Source: Primary data
The above table shows the credit card holders’ awareness towards insurance
services provided under credit card. Out of 103 credit card holders of ICICI bank only
71 cardholders accepted that they are aware of Insurance services of credit card. 78.9
percent aware of life insurance on card holder, 69 percent credit shield cover, 63.4
percent life insurance on add on card, and only 35.2 percent aware of purchase
263
protection service of credit card. In case of SBI, 57 cardholders accepted that they are
aware of insurance services of credit card. Among 57 cardholders, 91.2 percent aware
of credit shield cover, 71.9 percent purchase protection, 56.1 percent aware of life
insurance on cardholder, 49.1 percent aware of personal accident cover, and only
17.5 percent of cardholders are aware of life insurance on add on card facility. It is
concluded that in both banks the number of cardholders aware of insurance services is
less. So the study banks should take necessary steps to create awareness among the
cardholders about the insurance services through appropriate promotional strategy.
264
Table 4.2.13
Multiple Response Analysis of Awareness towards
Any Branch Banking services
Any Branch Banking
services
ICICI SBI
Response Percent
of cases
Response
N
Percent
N
percent Percent
of cases
Deposit of cash at non-
home branch 20 25.4% 100.0% 27 26.5% 96.4%
Deposit of cheque&
clearing instrument 13 16.4% 65.0% 20 19.6% 71.4%
Cash withdrawal at non-
home branch 11 14.0% 55.0% 15 14.7% 53.6%
Balance enquiry at non-
home branch 5 6.3% 25.0% 4 4.0% 14.3%
Get statement of a/c
5 6.3% 25.0% 8 7.8% 28.6%
Pass book updation
12 15.2% 60.0% 18 17.6% 64.3%
Fund transfer to third
party a/c at another CBS
branch
13 16.4% 65.0% 10 9.8% 35.7%
Total
79 100.0% 395.0% 102 100.0% 364.3%
Source: Primary data
The above table shows the awareness of any branch banking customers
towards various services provided under it. Out of 20 ICICI bank’s any branch
banking customers, 100 percent aware of deposit service, 75 percent aware of cash
withdrawal at non-home branch, 85 percent fund transfer, 65 percent pass book
updating and 70 percent aware of balance enquiry at non-home branch. It is concluded
that majority of the customers aware of services provided under any branch banking.
Among 28 any branch banking users of SBI, 96.4 percent aware of deposit
facility at non-home branch, 71.4 percent aware of deposit of cheque at non-home
branch, 64.3 percent aware of pass book updating facility, 35.7 percent aware of fund
transfer facility and only 14.3 percent aware of balance enquiry at non-home branch
service. It is concluded that awareness among SBI bank’s any branch banking
customers are not sufficient. So the bank should create awareness among customers to
achieve higher satisfaction.
265
4.3 INFERENTIAL ANALYSIS ON SAMPLES
HYPOTHESIS- I
Null Hypothesis: There is no significant association between age group and
ICICI Bank customers’ Awareness with respect to various
dimensions of ATM-cum-Debit card services
Table 4.3.1 Chi-Square test for significant association between age group and
ICICI Bank customers’ Awareness with respect to various dimensions of ATM-
cum-Debit card services
Dim
ensi
on
Awaren
ess
Age
Total
Chi-
square
P value
<30 30-40 40-50 >50
Co
nv
enie
nce
serv
ices
Aware
43
(68.3)
59
(62.8)
47
(64.4)
21
(65.6)
170
0.515
0.916
Not
aware
20
(31.7)
35
(37.2)
26
(35.6)
11
(34.4)
92
Total
63
94
73
32
262
Va
lue
ad
ded
serv
ices
Aware
33
(52.4)
50
(53.2)
47
(64.4)
12
(37.5)
142
6.767
0.080
Not
aware
30
(47.6)
44
(46.8)
26
(35.6)
20
(62.5)
120
Total
63
94
73
32
262
Ser
vic
es a
t P
OS
Aware
56
(88.8)
88
(93.6)
66
(90.4)
27
(84.4)
237
2.639
0.451
Not
aware
7
(11.1)
6
(6.4)
7
(9.6)
5
(15.6)
25
Total
63
94
73
32
262
Oth
er s
erv
ices
Aware
36
(57.6)
51
(54.3)
41
(56.2)
17
(53.1)
145
0.211
0.976
Not
aware
27
(42.9)
43
(45.7)
32
(43.8)
15
(46.9)
117
Total 63
94 73 32 262
Note: The value within brackets refers to column percentage
266
Since P value is greater than 0.05, the null hypothesis is accepted at 5% level
of significance. Hence, there is no association between age group and ICICI bank
customers’ awareness with respect to various dimensions of ATM- cum – Debit card
services. It is concluded that age group has no direct influence on awareness of ICICI
bank ATM-Cum-debit card users.
267
HYPOTHESIS- II
Null Hypothesis: There is no significant association between age group and SBI
Bank customers’ Awareness with respect to various dimensions
of ATM-cum-Debit card services
Table 4.3.2 Chi-Square test for significant association between age group and
SBI Bank customers’ Awareness with respect to various dimensions of ATM-
cum-Debit card services
Dimension
Awareness
Age
Total
Chi-
squar
e
P value
<30 30-40 40-50 >50
Co
nv
enie
nce
servic
es
Aware 33
(70.2)
71
(68.3)
25
(54.3)
8
(34.8)
137
11.481
0.009***
Not aware
14
(29.8)
33
(31.7)
21
(45.7)
15
(65.2)
83
Total
47
104
46
23
220
Va
lue
ad
ded
serv
ices
Aware 35
(74.5)
75
(72.1)
33
(71.7)
14
(60.9)
157
1.493
0.684 Not aware 12
(25.5)
29
(27.9)
13
(28.3)
9
(39.1)
63
Total 47
104 46 23 220
Ser
vic
es a
t
PO
S
Aware 47
(100.0)
99
(95.2)
44
(95.7)
17
(73.9)
207
20.223
0.000*** Not aware 0
(0.0)
5
(4.8)
2
(4.3)
6
(26.1)
13
Total 47
104 46 23 220
Oth
er
serv
ices
Aware 25
(53.2)
61
(58.7)
27
(58.7)
14
(60.9)
127
0.544
0.909 Not aware 22
(46.8)
43
(41.3)
19
(41.3)
9
(39.1)
93
Total 47 104 46 23 220
Note: The value within brackets refers to column percentage
Since P value is less than 0.01, the null hypothesis is rejected at 1% level of
significance with respect to convenience services and services at POS. Hence there is
a highly significant association between age and awareness of SBI debit card holders
268
with respect to convenience services and services at POS. It is concluded that the
awareness of age group below 30 years and 30-40 years with respect to convenience
service and services at POS is higher than other age group. The awareness of age
group above 50 years is very low with respect to convenience services. So, the SBI
should take appropriate steps to create awareness among older age group.
Since P value is greater than 0.05, the null hypothesis is accepted at 5% level
of significance with respect to value added service and other services of ATM-cum-
Debit card. Hence there is no significant association between age group and
awareness of SBI bank’s ATM – cum- debit card holders with respect to value added
services and other services. It is concluded that age has no direct influence on
awareness of SBI bank’s ATM – cum – Debit card holders with respect to value
added services and other services.
269
HYPOTHESIS- III
Null Hypothesis: There is no significant association between age group and
ICICI Bank Customers’ Awareness with respect to various
dimensions of internet banking services
Table 4.3.3 Chi-Square test for significant association between age group and
ICICI Bank customers’ Awareness with respect to various dimensions of
Internet banking services
Dimension
Awareness
Age
Total
Chi-
squar
e
P value
<30 30-40 40-50 >50
Co
nv
en
ien
ce
serv
ices
Aware 9
(52.9)
15
(68.2)
18
(75.0)
6
(60.0)
48
2.355
0.502
Not aware 8
(47.1)
7
(31.8)
6
(25.0)
4
(40.0)
25
Total 17 22 24 10 73
Val
ue
add
ed
serv
ices
Aware 10
(58.8)
17
(77.3)
22
(91.7)
10
(100.0)
59
9.680
0.021** Not aware 7
(41.2)
5
(22.7)
2
(8.3)
0
(0.0)
14
Total
17
22
24
10
73
Note: The value within brackets refers to column percentage
Since P value is greater than 0.05, the null hypothesis is accepted at 5% level
of significance with respect to convenience services of internet banking. Hence there
is no significant association between age group and awareness of ICICI bank
customers toward convenience services of internet banking. It is concluded that age
group has no direct influence on awareness of ICICI bank’s internet banking
customers with respect to convenience services.
Since P value is less than 0.05, the null hypothesis is rejected at 5% level of
significance with respect to value added services. Hence there is a significant
association between age group and awareness of ICICI bank’s net banking customers
270
towards value added service. It is concluded that the age group 30-40 and 40-50 years
are highly aware of value added services of net banking. So, the ICICI bank should
take necessary steps to increase their product awareness among other age group.
HYPOTHESIS- IV
Null Hypothesis: There is no significant association between age group and SBI
Bank Customers’ Awareness with respect to various
dimensions of Internet banking services
Table 4.3.4 Chi-Square test for significant association between age group and
SBI Bank Customers’ Awareness with respect to various dimensions of Internet
banking services
Dim
en
sio
n Awareness Age
Total
Chi-
square
P value
<30 30-40 40-50 >50
Co
nv
enie
nce
serv
ices
Aware 6
(75.0)
14
(66.7)
10
(47.6)
3
(42.9)
33
3.182
0.364 Not aware 2
(25.0)
7
(33.3)
11
(52.4)
4
(57.1)
24
Total
8
21
21
7
57
Valu
e ad
ded
serv
ices
Aware 7
(87.5)
14
(66.7)
11
(52.4)
4
(57.1)
36
3.305
0.347
Not aware 1
(12.5)
7
(33.3)
10
(47.6)
3
(42.9)
21
Total
8
21
21
7
57
Note: The value within brackets refers to column percentage
Since P value is greater than 0.05, the null hypothesis is accepted at 5% level
of significance with respect to convenience and value added services. Hence there is
no significant association between age group and awareness of SBI bank’s internet
banking customers with respect to convenience and value added services of Internet
271
banking. It is concluded that age group has no direct influence on awareness with
respect to various dimensions of internet banking.
HYPOTHESIS- V
Null Hypothesis: There is no significant association between age group and
ICICI Bank customers’ Awareness with respect to various
dimensions of Mobile banking services
Table 4.3.5 Chi-Square test for significant association between age group and
ICICI Bank customers’ Awareness with respect to various dimensions of Mobile
banking services
Dim
en
sio
n Awareness Age
Total
Chi-
square
P value
<30 30-40 40-50 >50
Info
rmati
on
bas
ed
serv
ices
Aware 6
(85.7)
10
(66.7)
3
(50.0)
0
(0.0)
19
3.812
0.282 Not aware 1
(14.3)
5
(33.3)
3
(50.0)
1
(100.0)
10
Total
7
15
6
1
29
Fin
anci
al
tran
sact
ion b
ased
serv
ices
Aware 6
(85.7)
9
(60.0)
4
(66.7)
0
(0.0)
19
3.370
0.338 Not aware 1
(14.3)
6
(40.0)
2
(33.3)
1
(100.0)
10
Total
7
15
6
1
29
Note: The value within brackets refers to column percentage
Since P value is greater than 0.05, the null hypothesis is accepted at 5% level
of significance. Hence there is no significant association between age group and
awareness of ICICI bank’s customers with respect to information based and financial
transaction based services of mobile banking. It is concluded that age group has no
direct influence on awareness of mobile banking customers of ICICI bank.
272
HYPOTHESIS- VI
Null Hypothesis: There is no significant association between age group and SBI
Banks customers’ Awareness with respect to various
dimensions of Mobile banking services
Table 4.3.6 Chi-Square test for significant association between age group and
SBI Bank customers’ Awareness with respect to various dimensions of Mobile
banking services
Dim
en
sio
n Awareness Age
Total
Chi-
square
P
value <30 30-40 40-50 >50
Info
rmat
ion
bas
ed
serv
ices
Aware
2
(100.0)
11
(64.7)
2
(50.0)
0
(0.0)
15
4.657
0.199
Not aware
0
(0.0)
6
(35.3)
2
(50.0)
2
(100.0)
10
Total
2
17
4
2
25
Fin
anci
al t
ran
sacti
on
bas
ed s
erv
ices
Aware
1
(50.0)
11
(64.7)
3
(75.0)
1
(50.0)
16
0.554
0.907
Not aware
1
(50.0)
6
(35.3)
1
(25.0)
1
(11.1)
9
Total
2
17
4
2
25
Note: The value within brackets refers to column percentage
Since P value is greater than 0.05, the null hypothesis is accepted at 5% level
of significant. Hence there is no significant association between age group and
awareness of SBI bank’s mobile banking customers with respect to information based
services and financial transaction based services. It is concluded that age group has no
direct influence on awareness of mobile banking customers of SBI bank.
273
HYPOTHESIS- VII
Null Hypothesis: There is no significant association between age group and
ICICI Bank Customers’ Awareness with respect to various
dimensions of Credit card services
Table 4.3.7 Chi-Square test for significant association between age group and
ICICI Bank customers’ Awareness with respect to various dimensions of Credit
card services
Dim
en
sio
n Awareness Age
Total
Chi-
squar
e
P value
<30 30-40 40-50 >50
Co
nv
enie
nce
serv
ices
Aware 17
(68.0)
25
(51.0)
18
(72.0)
3
(75.0)
63
4.173
0.243 Not aware 8
(32.0)
24
(49.0)
7
(28.0)
1
(28.0)
40
Total 25 49 25 4 103
Valu
e ad
ded
serv
ices
Aware 19
(76.0)
37
(75.5)
22
(88.0)
3
(75.0)
81
1.725
0.631 Not aware 6
(24.0)
12
(24.5)
3
(12.0)
1
(25.0)
22
Total 25
49 25 4 103
Ben
efi
t b
ased
serv
ices
Aware 11
(44.0)
31
(63.3)
22
(88.0)
2
(50.0)
66
10.952
0.012** Not aware 14
(56.0)
18
(36.7)
3
(12.0)
2
(50.0)
37
Total 25
49 25 4 103
Insu
ran
ce
serv
ices
Aware 16
(64.0)
20
(40.8)
13
(52.0)
0
(0.0)
49
7.428
0.059 Not aware 9
(36.0)
29
(59.2)
12
(48.0)
4
(100.0)
54
Total 25 49 25 4 103
Note: The value within brackets refers to column percentage
274
Since P value is greater than 0.05, the null hypothesis is accepted at 5% level
of significance with respect to convenience services, value added service and
insurance services. Hence there is no significant association between age group and
awareness of ICICI bank’s credit card holders with respect to convenience, value
added and insurance service. It is concluded that the age has no direct influence on
awareness of ICICI bank’s credit card holders with respect to convenience services,
value added services and Insurance services of credit card.
Since P value is less than 0.05, the null hypothesis is rejected at 5% level of
significance with respect to benefit services. Hence there is a significant association
between age group and awareness of ICICI bank’s credit card holders with respect to
benefit services. It is concluded that the awareness of age group below 30 years is
lesser than other age group. So, the ICICI bank should take necessary steps to create
awareness among younger age group regarding benefit services of credit card.
275
HYPOTHESIS- VIII
Null Hypothesis: There is no significant association between age group and SBI
Bank customers’ Awareness with respect to various dimensions
of Credit card services
Table 4.3.8 Chi-Square test for significant association between age group and
SBI Bank customers’ Awareness with respect to various dimensions of Credit
card services
Dim
ensi
on
Awareness Age
Total
Chi-
square
P value
<30 30-40 40-50 >50
Co
nv
enie
nce
serv
ices
Aware 13
(65.0)
20
(45.5)
10
(58.8)
0
(0.0)
43
2.394
0.302 Not aware 7
(35.0)
24
(54.5)
7
(41.2)
0
(0.0)
38
Total 20 44 17 0 81
Valu
e ad
ded
serv
ices
Aware 16
(80.0)
25
(31.4)
10
(58.8)
0
(0.0)
51
3.327
0.189 Not aware 4
(20.0)
19
(43.2)
7
(41.2)
0
(0.0)
30
Total 20
44 17 0 81
Ben
efi
t b
ased
serv
ices
Aware 17
(85.0)
25
(56.8)
9
(52.9)
0
(0.0)
51
5.610
0.061 Not aware 3
(15.0)
19
(43.2)
8
(47.1)
0
(0.0)
30
Total 20
44 17 0 81
Insu
ran
ce
serv
ices
Aware 15
(75.0)
27
(61.4)
10
(58.8)
0
(0.0)
52
1.383
0.501 Not aware 5
(25.0)
17
(38.6)
7
(41.2)
0
(0.0)
29
Total
20 44 17 0 81
Note: The value within brackets refers to column percentage
Since P value is greater than 0.05, the null hypothesis is accepted at 5% level
of significant with respect to various dimensions of credit card services of SBI. Hence
there is no significant association between age group and awareness of SBI bank’s
credit cardholders with respect to various dimensions of credit card services. It is
276
concluded that age has no direct influence on the awareness of SBI credit card holders
with respect to dimensions of credit card services.
HYPOTHESIS- IX
Null Hypothesis: There is no significant association between gender and ICICI
Bank customers’ Awareness with respect to various dimensions
of ATM-cum- Debit card services
Table 4.3.9 Chi-Square test for significant association between gender and ICICI
Bank customers’ Awareness with respect to various dimensions of ATM-cum-
Debit card services
Dimension Awareness Sex
Total
Chi-
square
value
P value Male Female
Co
nv
enie
nce
serv
ices
Aware 145
(65.9)
25
(59.5)
170
0.631
0.427
Not aware 75
(34.1)
17
(40.5)
92
Total 220 42 262
Valu
e ad
ded
serv
ices
Aware 116
(52.7)
26
(61.9)
142
1.197
0.274
Not aware 104
(47.3)
16
(38.1)
120
Total 220 42 262
Serv
ices
at
PO
S
Aware 198
(90.0)
39
(92.9)
237
0.334
0.564
Not aware 22
(10.0)
3
(7.1)
25
Total 220 42 262
Oth
er s
erv
ices Aware 128
(58.2)
17
(40.5)
145
4.473
0.034**
Not aware 92
(41.8)
25
(59.5)
117
Total 220 42 262
Note: The value within brackets refers to column percentage
Since P value is greater than 0.05, the null hypothesis is accepted at 5% level
of significant with respect to convenient services, value added services, and services
277
at POS. hence there is no significant association between gender and awareness of
ICICI bank’s ATM – cum- Debit card holders with respect to convenience services,
value added service and services at POS of ATM – cum debit card. It is concluded
that gender has no direct influence on awareness with respect convenience services,
value added services and services at POS.
Since P value is less than 0.05, the null hypothesis is rejected at 5% level of
significance with respect to other services of debit card. Hence there is a significant
association between gender and awareness of ICICI bank’s ATM – cum – Debit card
holders with respect to other services of debit card. It is concluded that the awareness
of male card holder is higher than female cardholders with respect to other service
category of debit card services. So the ICICI bank should take necessary steps to
increase the awareness of female debit card holders with respect to services in other
service category.
278
HYPOTHESIS- X
Null Hypothesis: There is no significant association between gender and SBI
Bank customers’ Awareness with respect to various dimensions
of ATM-cum-Debit card services .
Table 4.3.10 Chi-Square test for significant association between gender and SBI
Bank customers’ Awareness with respect to various dimensions of ATM-cum-
Debit card services
Dim
ensi
on
s
Awareness
Sex
Total
Chi-Square
Value
P-Value
Male
Female
Co
nv
enie
nce
serv
ices
Aware 100
(62.5)
37
(61.7)
137
0.013
0.910 Not aware 60
(37.5)
23
(38.3)
83
Total 160 60 220
Val
ue
add
ed
serv
ices
Aware 114
(71.3))
43
(71.1)
157
0.004
0.951 Not aware 46
(28.8)
17
(28.3)
63
Total 160 60 220
Serv
ices
at
PO
S
Aware 151
(94.4)
56
(93.3)
207
0.085
0.770 Not aware 9
(5.6)
4
(6.7)
13
Total 160 60 220
Oth
er
serv
ices
Aware 96
(60.0)
31
(51.7)
127
1.242
0.265 Not aware 64
(40.0)
29
(48.3)
93
Total 160 60 220
Note: The value within brackets refers to column percentage
Since P value is greater than0.05, the null hypothesis is accepted at 5% level
of significance with respect to various dimensions of ATM – cum- debit card services.
Hence there is no significant association between gender and awareness of SBI bank’s
debit card holders with respect to various dimensions of ATM – cum – debit card. It is
279
concluded that gender has no direct influence on awareness of SBI customers with
respect to dimensions of ATM – cum – Debit card services.
HYPOTHESIS- XI
Null Hypothesis: There is no significant association between gender and ICICI
Bank customers’ Awareness with respect to various
dimensions of Internet banking services
Table 4.3.11 Chi-Square test for significant association between gender and
ICICI Bank customers’ Awareness with respect to various dimensions of
Internet banking services
Dimension Awareness Sex Total Chi-
square
value
P value
Male Female
Co
nv
enie
nce
serv
ices
Aware 44
(73.3)
4
(30.8)
48
8.597
0.003***
Not aware 16
(26.7)
9
(69.2)
25
Total 60 13 73
Val
ue
add
ed
serv
ices
Aware 52
(86.7)
7
(53.8)
59
7.426
0.006***
Not aware 8
(13.3)
6
(46.2)
14
Total 60 13 73
Note: The value within brackets refers to column percentage
Since P value is less than 0.01, the null hypothesis is rejected at 1% level of
significance with respect to various dimensions of internet banking services. Hence
there is a highly significant association between gender and awareness of ICICI
bank’s net banking customers with respect to convenience services and value added
services of net banking. It is concluded that the awareness of male is higher than
female with respect to convenience and value added services of net banking provided
by ICICI bank. So, the ICICI bank should take necessary steps to increase the
awareness of female mobile banking users.
280
HYPOTHESIS- XII
Null Hypothesis: There is no significant association between gender and SBI
Bank customers’ Awareness with respect to various dimensions
of Internet banking services
Table 4.3.12 Chi-Square test for significant association between gender and SBI
Bank customers’ Awareness with respect to various dimensions of Internet
banking services
Dimension
Awareness
Sex
Total
Chi-
square
value
P value Male Female
Co
nv
enie
nce
serv
ices
Aware 28
(58.3)
5
(55.6)
33
0.024
0.887 Not aware 20
(41.7)
4
(44.4)
24
Total 48 9 57
Val
ue
add
ed
serv
ices
Aware 31
(64.6)
5
(55.6)
36
0.265
0.606 Not aware 17
(35.4)
4
(44.4)
21
Total 48 9 57
Note: The value within brackets refers to column percentage
Since P value is greater than 0.05, the null hypothesis is accepted at 5% level
of significance with respect to various dimension of internet banking services. Hence
there is no significant association between gender and awareness of SBI bank’s
internet banking customers with respect to various dimensions of internet banking
services. It is concluded that gender has no direct influence on awareness of SBI
customers with respect to convenience services and value added services of net
banking.
281
HYPOTHESIS- XIII
Null Hypothesis: There is no significant association between gender and ICICI
Bank customers’ Awareness with respect to various dimensions
of Mobile banking services
Table 4.3.13 Chi-Square test for significant association between gender and
ICICI Bank customers’ Awareness with respect to various dimensions of Mobile
banking services
Dimension
Awareness
Sex
Total
Chi-
square
value
P value Male Female
Info
rmat
ion
bas
ed
serv
ices
Aware 16
(66.7)
3
(60.0)
19
0.081
0.775 Not aware 8
(33.3)
2
(40.0)
10
Total 24 5 29
Fin
an
cial
tran
sact
ion
bas
ed
serv
ices
Aware 16
(66.7)
3
(60.0)
19
0.081
0.775 Not aware 8
(33.3)
2
(40.0)
10
Total 24 5 29
Note: The value within brackets refers to column percentage
Since P value is greater than 0.05, the null hypothesis is accepted at 5% level
of significance. Hence there is no significant association between gender and
awareness of ICICI bank’s mobile banking customers with respect to information
based services and financial transaction based services. It is concluded that gender has
no direct influence on awareness of SBI mobile banking customers.
282
HYPOTHESIS-XIV
Null Hypothesis: There is no significant association between gender and SBI
Bank customers’ Awareness with respect to various dimensions
of Mobile banking services
Table 4.3.14 Chi-Square test for significant association between gender and SBI
Bank Customers’ Awareness with respect to various dimensions of Mobile
banking services
Dimension
Awareness
Sex
Total
Chi-
square
value
P value Male Female
Info
rmat
ion
bas
ed
serv
ices
Aware 10
(58.8)
5
(62.5)
15
0.031
0.861 Not aware 7
(41.2)
3
(37.5)
10
Total 17 8 25
Fin
an
cial
tran
sact
ion
bas
ed
serv
ices
Aware 10
(58.8)
6
(75.0)
16
0.618
0.432 Not aware 7
(41.2)
2
(25.0)
9
Total 17 8 25
Note: The value within brackets refers to column percentage
Since P value is greater than 0.05, the null hypothesis is accepted at 5% level
of significance. Hence there is no significant association between gender and
awareness of SBI bank’s mobile banking customers with respect to various
dimensions of mobile banking services. It is concluded that gender has no direct
influence on awareness of mobile banking customers with respect to information
based services and financial transaction based services of mobile banking.
283
HYPOTHESIS- XV
Null Hypothesis: There is no significant association between gender and ICICI
Bank customers’ Awareness with respect to various dimensions
of Credit card services
Table 4.3.15 Chi-Square test for significant association between gender and
ICICI Bank customers’ Awareness with respect to various dimensions of Credit
card services
Dimension
Awareness
Sex
Total
Chi-
square
value
P value Male Female
Co
nv
enie
nce
serv
ices
Aware 56
(62.2)
7
(53.8)
63
0.336
0.562 Not aware 34
(37.8)
6
(46.2)
40
Total 90 13 103
Valu
e ad
ded
serv
ices
Aware 72
(80.0)
9
(69.2)
81
0.784
0.376 Not aware 18
(20.0)
4
(30.8)
22
Total 90 13 103
Ben
efit
bas
ed
serv
ices
Aware 59
(65.6)
7
(53.8)
66
0.677
0.411 Not aware 31
(34.4)
6
(46.2)
37
Total 90 13 103
Insu
ran
ce
serv
ices
Aware 43
(47.8)
6
(46.2)
49
0.012
0.913 Not aware 47
(52.2)
7
(53.8)
54
Total 90 13 103
Note: The value within brackets refers to column percentage
Since P value is greater than 0.05, the hypothesis is accepted at 5% level of
significance with respect to various dimensions of credit card services. Hence there is
no significant association between gender and awareness of ICICI bank’s credit card
holders with respect to convenience, value added, benefit and Insurance services of
credit card. It is concluded that gender has no direct influence on the awareness of
ICICI bank’s credit card holders.
284
HYPOTHESIS- XVI
Null Hypothesis: There is no significant association between gender and SBI
Bank Customers’ Awareness with respect to various
dimensions of Credit card services
Table 4.3.16 Chi-Square test for significant association between gender and SBI
Bank customers’ Awareness with respect to various dimensions of Credit card
services
Dimension
Awareness
Sex
Total
Chi-
square
value
P value Male Female
Co
nv
enie
nce
serv
ices
Aware 30
(53.6)
13
(52.0)
43
0.017
0.896 Not aware 26
(46.4)
12
(48.0)
38
Total 56 25 81
Valu
e ad
ded
serv
ices
Aware 38
(67.9)
13
(52.0)
51
1.864
0.172 Not aware 18
(32.1)
12
(48.0)
30
Total 56 25 81
Benef
it b
ase
d
serv
ices
Aware 38
(67.9)
13
(52.0)
51
1.864
0.172 Not aware 18
(32.1)
12
(48.0)
30
Total 56 25 81
Insu
ran
ce
serv
ices
Aware 40
(71.4)
12
(48.0)
52
4.128
0.042** Not aware 16
(28.6)
13
(52.0)
29
Total 56 25 81
Note: The value within brackets refers to column percentage
Since P value is greater than 0.05, the hypothesis is accepted at 5% level of
significance with respect to convenience services, value added services and benefit
services. Hence there is no significant association between gender and awareness of
SBI bank’s credit card holder with respect to convenience services, value added
services and benefit of services of credit card.
285
Since P value is less than 0.05, the null hypothesis is rejected at 5% level of
significance with respect to Insurance services. Hence there is a significant
association between gender and awareness of SBI bank’s credit card holders with
respect to Insurance services of credit card. It is concluded that the awareness of male
cardholders is higher than female. So, the SBI bank should take necessary steps to
increase the awareness of female cardholders through appropriate promotional
strategy.
286
HYPOTHESIS- XVII
Null Hypothesis: There is no significant association between educational
qualification and ICICI Bank customers’ Awareness with
respect to various dimensions of ATM-cum-Debit card services
Table 4.3.17 Chi-Square test for significant association between Educational
qualification and ICICI Bank customers’ Awareness with respect to various
dimensions of ATM-cum-Debit Card services
Note: The value within brackets refers to column percentage
Dim
en
sio
n
Aw
are
nes
s Educational qualification
To
tal
Ch
i-sq
ua
re
P v
alu
e
Gra
du
at
e
Po
st
gra
du
at
e pro
fess
i
on
al
Do
cto
ra
t
e
oth
ers
Co
nv
enie
nce
serv
ices
Aware 42
(66.7)
88
(64.7)
18
(58.1)
8
(80.0)
14
(63.6)
170
1.740
0.783 Not aware 21
(33.3)
48
(35.3)
13
(41.9)
2
(20.0)
8
(36.4)
92
Total 63
136 31 10 22 262
Valu
e ad
ded
serv
ices
Aware 44
(69.8)
69
(50.7)
19
(61.3)
5
(50.0)
5
(22.7)
142
16.344
0.003*** Not aware 19
(30.2)
67
(49.3)
12
(38.7)
5
(50.0)
17
(77.3)
120
Total 63
136 31 10 22 262
Ser
vic
es
at
PO
S
Aware 54
(85.7)
125
(91.9)
30
(96.8)
9
(90.0)
19
(86.4)
237
3.838
0.428 Not aware 9
(14.3)
11
(8.1)
1
(3.2)
1
(10.0)
3
(13.6)
25
Total 63
136 31 10 22 262
Oth
er s
erv
ices
Aware 37
(58.7)
74
(54.4)
17
(54.8)
8
(80.0)
9
(40.9)
145
4.658
0.324 Not aware 26
(41.3)
62
(45.6)
14
(45.2)
2
(20.0)
13
(59.1)
117
Total
63 136 31 10 22 262
287
Since P value is greater than 0.05, the null hypothesis is accepted at 5%
level of significance with respect to convenience services, services at POS and
other services. Hence, there is no significant association between educational
qualification and awareness of ICICI bank’s ATM – cum- debit and holders
with respect to convenience services, services at POS and other services of
debit card. Since P value is less than 0.01, the null hypothesis is rejected at 1%
level of significance with respect to value added services at ATM. Hence there
is a highly significant association between educational qualification and ICICI
bank’s ATM-cum-Debit card holder’s awareness with respect to value added
services at ATM. It is concluded that the awareness of graduates is higher than
others. So the ICICI bank should take necessary steps to create awareness
among other group of customers.
288
HYPOTHESIS- XVIII
Null Hypothesis: There is no significant association between gender and SBI
Bank customers’ Awareness with respect to various dimensions
of ATM-cum-Debit card services
Table 4.3.18 Chi-Square test for significant association between educational
qualification and SBI Bank customers’ Awareness with respect to various
dimensions of ATM-cum-Debit card Services
Dim
ensi
on
Aw
aren
ess
Educational qualification
To
tal
Ch
i-sq
ua
re
P v
alu
e
Gra
du
at
e
Po
st
gra
du
ate
pro
fess
io
na
l
Do
cto
rat
e
oth
ers
Co
nv
enie
nce
serv
ices
Aware 36
(52.2)
40
(70.2)
42
(70.0)
6
(54.5)
13
(56.5)
137
6.639
0.156 Not
aware
33
(47.8)
17
(29.8)
18
(30.0)
5
(45.5)
10
(43.5)
83
Total 69
57 60 11 23 220
Val
ue
ad
ded
serv
ices
Aware 39
(56.5)
44
(77.2)
56
(93.3)
10
(90.0)
8
(34.8)
157
39.674
0.000*** Not
aware
30
(43.5)
13
(22.8)
4
(6.7)
1
(9.1)
15
(65.2)
63
Total 69
57 60 11 23 220
Ser
vic
es a
t P
OS
Aware 61
(88.4)
53
(93.0)
60
(100.0)
10
(90.9)
23
(100.
0)
207
9.550
0.049**
Not
aware
8
(11.6)
4
(7.0)
0
(0.0)
1
(9.1)
0
(0.0)
13
Total 69
57 60 11 23 220
Oth
er s
erv
ices
Aware 28
(40.6)
41
(71.9)
42
(70.0)
7
(63.6)
9
(39.1)
127
20.146
0.000*** Not
aware
41
(59.4)
16
(28.1)
18
(30.0)
4
(36.4)
14
(60.9)
93
Total
69 57 60 11 23 220
Note: The value within brackets refers to column percentage
Since P value is greater than 0.05, the null hypothesis is accepted at 5% level
of significance with respect to convenience services. Hence there is no significant
289
association between educational qualification and awareness of SBI bank’s ATM-
cum-debit card holders with respect to convenience services. Since P value is less
than 0.01 the null hypothesis is rejected at 1% level of significance with respect to
value added services at ATM and other services of debit card. Hence, there is a highly
significant association between educational qualification and SBI bank’s ATM – cum-
debit cardholder’s awareness with respect to value added services at ATM and other
services of debit card. It is concluded that awareness of professionals is higher than
others with respect to value added services and the awareness of customers whose
qualification come under other category is low with respect to value added services
and other services.
Since P value is less than 0.05, the null hypothesis is rejected at 5% level of
significance with respect to services at POS. Hence there is a significant association
between SBI bank’s ATM – cum- debit cardholders’ awareness with respect to
services at POS and their educational qualification. So, the SBI bank should take
necessary steps to create awareness among customer taking into consideration their
educational qualification.
290
HYPOTHESIS- XIX
Null Hypothesis: There is no significant association between educational
qualification and ICICI Bank Customers’ Awareness with
respect to various dimensions of Internet banking services
Table 4.3.19 Chi-Square test for significant association between educational
qualification and ICICI Bank customers’ awareness with respect to dimensions
of internet Banking services
Dim
en
si
on
Aw
are
n
ess
Educational qualification
Total
Chi-
square
P
value
Graduate Post
graduate
professi
onal
Doctorate others
Co
nv
enie
nce
serv
ices
Aware 13
(61.9)
18
(64.3)
13
(76.5)
3
(60.0)
1
(50.0)
48
1.326
0.857 Not
aware
8
(38.1)
10
(35.7)
4
(23.5)
2
(40.0)
1
(50.0)
25
Total 21
28 17 5 2 73
Valu
e ad
ded
serv
ices
Aware 14
(66.7)
25
(89.3)
15
(88.2)
4
(80.0)
1
(50.0)
59
5.839
0.211 Not
aware
7
(33.3)
3
(10.7)
2
(11.8)
1
(20.0)
1
(50.0)
14
Total 21
28 17 5 2 73
Note: The value within brackets refers to column percentage
Since P value is greater than 0.05, the null hypothesis is accepted at 5% level
of significance with respect to various dimensions of internet banking services. Hence
there is no significant association between educational qualification and awareness of
ICICI bank’s net banking customers with respect to convenience and value added
services of net banking. It is concluded that educational qualification has no direct
influence on awareness with respect to dimensions of net banking services of ICICI.
291
HYPOTHESIS- XX
Null Hypothesis: There is no significant association between educational
qualification and SBI Bank Customers’ Awareness with respect
to dimensions of Net banking services.
Table 4.3.20 Chi-Square test for significant association between educational
qualification and SBI Customers’ Awareness with respect to various dimensions
of Net banking services
Note: The value within brackets refers to column percentage
Since P value is less than 0.01, the null hypothesis is rejected at 1% level of
significance with respect to convenience services. Hence there is a highly significant
association between educational qualification and awareness of SBI bank’s Internet
banking users with respect to convenience services. It is concluded that awareness of
graduates is higher than others. Since P value is greater than 0.05, the null hypothesis
is accepted at 5% level of significance, with respect to value added services of net
banking. Hence there is no significant association between educational qualifications
and awareness of SBI bank’s net banking customers with respect to value added
services.
Dim
ensi
on
Aw
are
ness
Educational qualification Total Chi-
square
P value Graduate Post
graduate
professi
onal
Doctorate others
Co
nv
en
ien
ce
serv
ices
Aware 13
(81.3)
9
(60.0)
6
(37.5)
1
(16.7)
4
(100.0)
33
13.430
0.009*** Not
aware
3
(18.8)
6
(40.0)
10
(62.5)
5
(83.3)
0
(0.0)
24
Total 16
15 16 6 4 57
Val
ue
ad
ded
serv
ices
Aware 11
(68.8)
7
(46.7)
10
(62.5)
5
(83.3)
3
(75.0)
36
3.262
0.515 Not
aware
5
(31.3)
8
(53.3)
6
(37.5)
1
(16.7)
1
(25.0)
21
Total 16
15 16 6 4 57
292
HYPOTHESIS-XXI
Null Hypothesis: There is no significant association between educational
qualification and ICICI Customers’ Awareness with
respect to dimensions of Mobile banking services.
Table 4.3.21 Chi-Square test for significant association between educational
qualification and ICICI Customers’ Awareness with respect to dimensions of
Mobile banking services
Note: The value within brackets refers to column percentage
Since P value is greater than 0.05, the null hypothesis is accepted at 5% level
of significance with respect to dimensions of mobile banking services. Hence, there is
no significant association between educational qualification and awareness of ICICI
bank’s mobile banking customers with respect to dimensions of mobile banking
services. It is concluded that educational qualification has no influence on awareness
of ICICI bank’s mobile banking customers with respect dimensions of mobile
banking services.
Dim
ensi
on
Aw
are
nes
s Educational qualification
Total
Chi-
square
P
value Graduate Post
graduate
professi
onal
Doctorate others
Info
rmati
on
base
d
serv
ices
Aware 3
(60.0)
10
(58.8)
5
(83.3)
1
(100.0)
0
(0.0)
19
1.774
0.621 Not
aware
2
(40.0)
7
(41.2)
1
(16.7)
0
(0.0)
0
(0.0)
10
Total 5
17 6 1 0 29
Fin
anci
al
tran
sact
ion b
ased
serv
ices
Aware 4
(80.0)
11
(64.7)
4
(66.7)
0
(0.0)
0
(0.0)
19
2.373
0.499 Not
aware
1
(20.0)
6
(35.3)
2
(33.3)
1
(100.0)
0
(0.0)
10
Total 5 17 6 1 29
293
HYPOTHESIS-XXII
Null Hypothesis: There is no significant association between educational
qualification and SBI Bank Customers’ Awareness with
respect to dimensions of Mobile banking services
Table 4.3.22 Chi-Square test for significant association between educational
qualification and SBI Customers’ Awareness with respect to dimensions of
Mobile banking services
Dim
en
sio
n
Aw
are
nes
s Educational qualification
Total
Chi-
square
P
value
Graduate Post
graduate
professi
onal
Doctorate others
Info
rmat
ion
bas
ed
serv
ices
Aware 0
(0.0)
6
(60.0)
8
(66.7)
1
(33.3)
0
(0.0)
15
1.111
0.574 Not
aware
0
(0.0)
4
(40.0)
4
(33.3)
2
(66.7)
0
(0.0)
10
Total 0
10 12 3 0 25
Fin
anci
al
tran
sacti
on
bas
ed
serv
ices
Aware 0
(0.0)
5
(50.0)
10
(83.3)
1
(33.3)
0
(0.0)
16
4.022
0.134 Not
aware
0
(0.0)
5
(50.0)
2
(16.7)
2
(66.7)
0
(0.0)
9
Total 0
10 12 3 0 25
Note: The value within brackets refers to column percentage
Since P value is greater than 0.05, the null hypothesis is accepted at 5% level
of significance with respect to dimensions of mobile banking services. Hence there is
no significant association between educational qualification and awareness of SBI
bank’s mobile banking customers with respect to information based services and
transaction based services. It is concluded the educational qualification has no
influence on awareness with respect to mobile banking services of SBI.
294
HYPOTHESIS- XXIII
Null Hypothesis: There is no significant association between educational
qualification and ICICI Bank customers’ Awareness with
respect to various dimensions of Credit card services
Table 4.3.23 Chi-Square test for significant association between educational
qualification and ICICI Customers’ Awareness with respect to various
dimensions of Credit card services
Note: The value within brackets refers to column percentage
Dim
en
sio
n
Aw
are
nes
s
Educational qualification
Total
Chi-
square
P
value
Graduate Post
graduate
professi
onal
Doctorate others
Co
nv
enie
nce
serv
ices
Aware 13
(65.0)
38
(60.3)
9
(69.2)
0
(0.0)
3
(75.0)
63
5.546
0.236 Not
aware
7
(35.0)
25
(39.7)
4
(30.8)
3
(100.0)
1
(25.0)
40
Total 20
63 13 3 4 103
Valu
e ad
ded
serv
ices
Aware 15
(75.0)
50
(79.4)
12
(92.3)
2
(66.7)
2
(50.0)
81
3.833
0.429 Not
aware
5
(25.0)
13
(20.6)
1
(7.7)
1
(33.3)
2
(50.0)
22
Total 20
63 13 3 4 103
Ben
efit
bas
ed
serv
ices
Aware 13
(65.0)
40
(63.5)
9
(69.2)
2
(66.7)
2
(50.0)
66
0.502
0.972 Not
aware
7
(35.0)
23
(36.5)
4
(30.8)
1
(33.3)
2
(50.0)
37
Total 20 63 13 3 4 103
Insu
ran
ce
serv
ices
Aware 14
(70.0)
23
(36.5)
9
(69.2)
1
(33.3)
2
(50.0)
49
9.824
0.043** Not
aware
6
(30.0)
40
(63.5)
4
(30.8)
2
(66.7)
2
(50.0)
54
Total
20 63 13 3 4 103
295
Since P value is greater than 0.05, the null hypothesis is accepted at 5% level
of significance with respect to convenience services, value added services and benefit
services. Hence there is no significant association between educational qualification
and awareness of ICICI bank’s credit card holders with respect to convenience
services, value added services and benefit services. Since P value is less than 0.05, the
null hypothesis is rejected at 5% level of significance with respect to insurance
services of credit card. Hence there is a significant association between educational
qualification and awareness of ICICI bank’s credit card holders with respect to
insurance services. It is concluded that awareness of graduates is higher than others
and the awareness of customer who is highly qualified with doctorate is low. So, the
bank should take steps to create awareness among highly qualified persons.
296
HYPOTHESIS- XXIV
Null Hypothesis: There is no significant association between educational
qualification and SBI Customers’ Awareness with respect to
various dimensions of Credit card services
Table 4.3.24 Chi-Square test for significant association between educational
qualification and SBI Customers’ Awareness with respect to various dimensions
of Credit card services
Dim
en
sio
n
Aw
are
nes
s Educational qualification
Total
Chi-
square
P
value
Graduate Post
graduate
professio
nal
Doctorate others
Co
nv
en
ien
ce
serv
ices
Aware 7
(31.8)
11
(45.8)
21
(72.4)
3
(100.0)
1
(33.3)
42
11.974
0.018** Not
aware
15
(68.2)
13
(54.2)
8
(27.6)
0
(0.0)
2
(66.7)
38
Total 22
24 29 3 3 81
Valu
e ad
ded
serv
ices
Aware 11
(50.0)
15
(62.5)
20
(69.0)
3
(100.0)
2
(66.7)
51
3.818
0.431 Not
aware
11
(50.0)
9
(37.5)
9
(31.0)
0
(0.0)
1
(33.3)
30
Total 22
24 29 3 3 81
Ben
efit
base
d
serv
ices
Aware 9
(40.9)
13
(54.2)
24
(82.8)
3
(100.0)
2
(66.7)
51
12.040
0.017** Not
aware
13
(59.1)
11
(45.8)
5
(17.2)
0
(0.0)
1
(33.3)
30
Total 22
24 29 3 3 81
Insu
ran
ce
serv
ices
Aware 12
(54.5)
17
(70.8)
19
(65.5)
2
(66.7)
2
(66.7)
52
1.389
0.846 Not
aware
10
(45.5)
7
(29.2)
10
(34.5)
1
(33.3)
1
(33.3)
29
Total
22 24 29 3 3 81
Note: The value within brackets refers to column percentage
Since P value is less than 0.05, the null hypothesis is rejected at 5% level
of significance with respect to convenience services and benefit services of credit
card. Hence there is a significant association between educational qualification and
297
awareness of SBI bank’s credit card holders with respect to convenience services and
benefit services of credit card. It is concluded that the awareness of graduates is low
compared to others and the awareness of customers with professional qualification is
higher than others. So, the SBI bank should take necessary steps to create awareness
among customers regarding benefit services. Since P value is greater than 0.05, the
null hypothesis is accepted at 5% level of significance with respect to insurance
service. Hence there is no significant association between educational qualification
and awareness of SBI bank’s credit card holders with respect to insurance services of
credit card.
4.4 DESCRIPTIVE ANALYSIS OF SAMPLES
Descriptive analyses of samples with respect to utility are as follows:
Table 4.4.1
Multiple Response Analysis of utilization with respect to Convenience services at
ATM
Convenience services
at ATM
ICICI SBI
Response Percent
of cases
Response Percent
of cases N Percent N percent
Balance enquiry
262 18.5% 100.0% 220 20.8% 100.0%
Withdrawal of cash
262 18.5% 100.0% 220 20.8% 100.0%
Deposit of
cash/cheque
94 6.6% 35.9% 20 1.9% 9.1%
Obtain statement of
account 197 13.9% 75.2% 203 19.2% 92.3%
Cheque book request
72 5.1% 27.5% 0 0.0% 0.0%
Change of PIN
188 13.3% 71.8% 138 13.1% 62.7%
Fast cash
115 8.1% 43.9% 86 8.1% 39.1%
Shared ATM
226 16.0% 86.3% 170 16.1% 77.3%
Total
1416 100.0% 540.5% 1057 100.0% 480.5%
Source: Primary data
298
The above table shows the ATM – cum – Debit card holders’ usage of
convenience services at ATM. From the sample of 262 ICICI bank’s ATM-cum –
Debit card holders, 100 percent of them accepted that they use convenience services
provided at ATM. Inspection of the above multiple dichotomy analysis frequency
table indicates that 100 percent of the ICICI bank’s debit card holders utilize basic
convenience services such as balance enquiry and cash withdrawal. 75.2 percent use
ATM to obtain statement of account, 27.5 percent use cheque book request service,
43.9 percent fast cash and 35.9 percent use debit card for deposit.
From the sample of 220 SBI bank’s debit card holders 100 percent of them
accepted that they are using convenience services provided at ATM. 100 percent of
debit card holders use basic convenience services such as balance enquiry and cash
withdrawal, 92.3 percent utilize ATM to obtain statement of a/c, 62.7 percent use
ATM to change PIN and 77.3 Percent use shared ATM facility. It is concluded that in
both banks, debit card users use ATM to withdraw cash and for balance enquiry and
also to obtain statement of account. Only few customers are using debit card for
deposit of cash. So, the bank should adopt right strategy to promote these services and
encourage customers to use more convenience services.
299
Table 4.4.2
Multiple Response Analysis of utilization with respect to
Value added services at ATM
Value added
services at ATM
ICICI SBI
Response Response
N Percent Percent
of cases
N percent Percent
of cases
Fund transfer
between same
bank/branch
68 31.1% 49.3% 47 30.1% 56.6%
Card to card
transfer
15 6.8% 10.9% 20 12.8% 24.1%
Card to account
transfer
2 .9% 1.4% 2 1.3% 2.4%
Credit card bill
payment
56 25.6% 40.6% 36 23.1% 43.4%
Insurance payment
14 6.4% 10.1% 19 12.2% 22.9%
Holy and trust
donations
0 0.0% 0.0% 3 1.9% 3.6%
Educational fee
payment
1 0.5% 0.7% 4 2.6% 4.8%
Mobile Top-ups
56 25.6% 40.6% 20 12.8% 24.1%
Air ticket payment
7 3.2% 5.1% 5 3.2% 6.0%
Total
219 100.0% 158.7% 156 100.0% 188.0%
Source: Primary data
The above table shows the ATM – cum – Debit card holders’ utilization of
value added services provided at ATM. From the sample of 262 ICICI bank’s ATM-
cum- Debit card holders, 138 respondents accepted that they use value added services
at ATM. Among them 49.3 percent use fund transfer facility, 40.6 percent credit card
bill payments. 40.6 percent use ATM for mobile top- ups. Services such as card to
card transfer (10.9%), card to a/c transfer (1.4%), Educational fee payment (0.7%),
insurance payment (10.1%) were used by few cardholders. In SBI, 83 debit card
300
holders accepted that they are using value added services at ATM. Among them 56.6
percent use fund transfer, 43.4 percent credit card bill payment, 24.1 percent mobile
top up facility and 22.9 percent use Insurance payment facility at ATM.
It is concluded that the percentage of debit card holders using value added
services at ATM is very low. So, the study banks should take steps to increase the
usage of value added services provided at ATM.
301
Table 4.4.3
Multiple Response Analysis of utilization with respect to
Debit card services at POS
Debit card services at
POS
ICICI SBI
Response Percent
of cases
Response
N Percent N percent Percent
of cases
Payment for
purchases at POS
212 40.5% 99.1% 197 40.0% 100.0%
SMS alert on POS
transaction
178 34.0% 83.2% 153 31.1% 77.7%
Cash withdrawal at
POS
39 7.5% 18.2% 14 2.8% 7.1%
Attractive discount
41 7.8% 19.2% 20 4.1% 10.2%
Surcharge waiver
3 .6% 1.4% 7 1.4% 3.6%
Reward points
50 9.6% 23.4% 101 20.5% 51.3%
Total
523 100.0% 244.4% 492 100.0% 249.7%
Source: Primary data
The above table shows the utilization of debit card services at POS by debit
card holders. From the sample of 262 debit card holders of ICICI bank, 214 card
holders accepted that they use debit card services at POS. Among them, 99.1 percent
are using debit card for purchase at point of sale, 83.2 percent use SMS alert facility
and 23.4 percent use reward points. Other services such as cash withdrawal at POS
(18.2%), discount (19.2%) surcharge waiver (1.4%) are used by few debit card
holders only.
In SBI, 197 debit card holders accepted that they are using debit card services
provided at point of sale. Among them, 100 percent are using debit card for purchase
at point of scale, 77.7 percent SMS alert facility, 51.3 percent reward points, 10.2
percent discount and only 1.4 percent of cardholders are using surcharge waiver. It is
concluded that in both banks majority of debit card holders are using SMS alert and
reward points. The cash withdrawal facility at POS, discount and surcharge waiver is
302
used by very few cardholders. So, the banks should take appropriate steps to
encourage customers to use these services for higher satisfaction.
Table 4.4.4
Multiple Response Analysis of utilization with respect to
Other services of Debit card
Other services of
Debit card
ICICI SBI
Response Percent
of cases
Response
N Percent N percent Percent
of cases
Operate multiple
account with single
debit card
41 10.4% 20.6% 32 11.8% 23.0%
Personal accident
cover
26 6.6% 13.1% 3 1.1% 2.2%
Lost card liability
cover
36 9.2% 18.1% 24 8.9% 17.3%
Purchase protection
19 4.8% 9.5% 18 6.6% 12.9%
Online utility
payment
173 44.0% 86.9% 120 44.3% 86.3%
Online purchase
98 24.9% 49.2% 74 27.3% 53.2%
Total
393 100.0% 197.5% 271 100.0% 195.0%
Source: Primary data
The above table shows the usage of services categorized under other services of
debit card by card holders. From the sample 262 debit card holders of ICICI bank,
199 (76%) cardholders accepted that they are using services categorized as other
services. Among them, 86.9 percent are using debit card for online utility bill
payment, 24.9 percent for online purchases. 20 percent of cardholders are using single
card for multiple accounts, and 18.1 percent use lost card liability cover service of
debit card.
303
In SBI, 139 card holders accepted that they are using other services of debit card.
Among them, 86.3 percent using debit card for online utility bill payment, 23 percent
operate multiple account with single card and 17.3 percent use lost card liability cover
service of debit card.
It reveals that in both banks services such as personal accident cover, purchase
protection and lost card liability cover are used by very few card holders.
304
Table 4.4.5
Multiple Response Analysis of utilization with respect to
Convenience services of internet banking
Convenience services
of internet banking
ICICI SBI
Response Percent
of cases
Response
N Percent N percent Percent
of cases
Access account
information
73 15.2% 100.0% 57 14.9% 100.0%
Bill payment and
presentment 56 11.7% 76.7% 42 11.0% 73.7%
Bank statement by e-
51 10.6% 69.9% 48 12.6% 84.2%
Inter branch fund
transfer(own account)
52 10.8% 71.2% 47 12.3% 82.5%
Inter branch fund
transfer(third party a/c)
67 14.0% 91.8% 54 14.1% 94.7%
Transfer to any bank
a/c
32 6.7% 43.8% 37 9.7% 64.9%
RTGS payment
instruction
26 5.4% 35.6% 17 4.5% 29.8%
Apply for debit card
25 5.2% 34.2% 18 4.7% 31.6%
Intimate about loss of
ATM
card
18 3.8% 24.7% 8 2.1% 14.0%
Open deposit account
21 4.4% 28.8% 12 3.1% 21.1%
Cheque status enquiry
40 8.3% 54.8% 25 6.5% 43.9%
Apply for phone
banking
3 0.6% 4.1% 3 0.8% 5.3%
Apply for bank
products
16 3.3% 21.9% 14 3.7% 24.6%
Total
480 100.0% 657.5% 382 100.0% 670.2%
Source: Primary data
305
The above table shows the internet banking customers’ usage of convenience
services. Among 73 internet banking users of ICICI bank, 100 percent of them access
account information through net banking, 76.7 percent use bill payment and
presentment facility, 91.8 percent use inter branch fund transfer (third party a/c), 43.8
percent fund transfer to any bank a/c facility, 28.8 percent open deposit account
through net, 54.8 percent use cheque status enquiry service and only21.9 percent use
net to apply for bank products.
In SBI, among 57 net banking users all are accessing account information
through net banking 73.7 percent use bill payment and presentment, 82.5 percent inter
branch fund transfer to own a/c and 94.7 percent to third party a/c, 64.9 percent use
fund transfer to any bank a/c facility, 21.1 percent use net banking for opening deposit
account and 24.6 percent use net to apply for bank products.
It is concluded that in both banks customers are mainly using net banking for
bill payment, fund transfer, and to access account information other convenience
services are used by few customers.
306
Table 4.4.6
Multiple Response Analysis of utilization with respect to
Value added services of internet banking
Value added services
of internet banking
ICICI SBI
Response Percent
of cases
Response
N Percent N percent Percent
of cases
Linking bank a/c and
credit card a/c 10 5.1% 15.6% 5 3.2% 9.1%
Linking bank a/c and
Demat a/c 9 4.6% 14.1% 7 4.5% 12.7%
Access credit card
details
20 10.2% 31.3% 10 6.5% 18.2%
Credit card related
service request
19 9.6% 29.7% 6 3.9% 10.9%
Access Demat account
details 8 4.1% 12.5% 7 4.5% 12.7%
Online Air ticket
booking
17 8.6% 26.6% 19 12.3% 34.5%
Online Railway ticket
booking 57 28.9% 89.1% 55 35.5% 100.0%
Income, services
&Excise Duty
payment
17 8.6% 26.6% 14 9.0% 25.5%
Online custom duty
payment 0 0.0% 0.0% 0 0.0% 0.0%
Online shopping
40 20.3% 62.5% 32 20.6% 58.2%
Total
197 100.0% 307.8% 155 100.0% 281.8%
Source: Primary data
The above table shows the net banking customers’ usage of value added
services provided through net banking. From the sample of 73 ICICI bank net banking
customers,- 64 respondents accepted that they are utilizing value -added services of
net banking. Among them, 89.1 percent use net banking for online Railway ticket
booking, 31.3 percent for accessing credit card details, 26.6 percent for air ticket
booking and income, service tax payment and 62.5 percent for online purchases.
Other valued added services are used by very few net banking customers.
307
In SBI, 55 net banking customers accepted that they are using value added
services. The value added services used by majority of the net banking users are :
online Railway ticket booking (100%) online shopping (58.2%), online Air ticket
booking (34.5%), income and service tax payment (25.5%). Other value added
services are used only by very few net banking users. So the banks should take
appropriate steps to promote these services and encourage customers to use for higher
satisfaction.
308
Table 4.4.7
Multiple Response Analysis of utilization with respect to
Information based services of mobile banking
Information based
services of mobile
banking
ICICI SBI
Response Percent
of cases
Response
N Percent N percent Percent
of cases
Balance enquiry
29 19.7% 100.0% 25 18.4% 100.0%
Last 5 transaction
details
29 19.7% 100.0% 25 18.4% 100.0%
Cheque book request
11 7.5% 37.9% 9 6.6% 36.0%
Cheque status enquiry
12 8.2% 41.4% 18 13.2% 72.0%
Stop cheque request
2 1.4% 6.9% 3 2.2% 12.0%
Get credit card account
details 14 9.5% 48.3% 15 11.0% 60.0%
Get Demat account
details
1 .7% 3.4% 3 2.2% 12.0%
Loan account details
5 3.4% 17.2% 9 6.6% 36.0%
Locate branch/ATM
22 15.0% 75.9% 18 13.2% 72.0%
Apply for bank product
4 2.7% 13.8% 1 .7% 4.0%
Status of service
request
18 12.2% 62.1% 10 7.4% 40.0%
Total
147 100.0% 506.9% 136 100.0% 544.0%
Source: Primary data
The above table shows the usage of information based services of mobile
banking by customers. Among the 29 mobile banking customers of ICICI 100 percent
of them use mobile banking for balance enquiry and to know about last five
transaction details, 62.1 percent use mobile banking to know the status of service
request and 75.9 percent to locate branch/ATM. 48.3 percent to get credit card details
and 41.4 percent to cheque status enquiry.
309
In SBI, among 25 mobile banking users all are using information based
services and majority of them use mobile banking for balance enquiry (100%), last 5
transaction details (100%), cheque status enquiry (72%), credit card details (60%) and
status of service request(40%)
It reveal that services such as stop cheque request, loan a/c details, demat a/c
details, apply for bank product through mobile banking are used by very few mobile
banking customers. So, the banks should take appropriate steps to encourage the
mobile banking customers to avail more information based services.
310
Table 4.4.8
Multiple Response Analysis of utilization with respect to
Financial transaction based services of mobile banking
Financial transaction
based services
ICICI SBI
Response Percent
of cases
Response
N Percent N percent Percent
of cases
Bill payment
10 41.7% 66.7% 7 53.8% 70.0%
Fund transfer
9 37.5% 60.0% 6 46.2% 60.0%
Prepaid mobile
recharge
5 20.8% 33.3% 0 0.0% 0.0%
Total
24 100.0% 160.0% 13 100.0% 130.0%
Source: Primary data
The above table shows the utilization of transaction based services by mobile
banking customers. In ICICI bank out of 29 mobile banking customers, 15 customers
accepted that they are using transaction based services. Among them 66.7 percent use
bill payment, 60 percent use fund transfer services and only 33.3 percent use mobile
banking for prepaid mobile recharge.
In SBI, out of 25 mobile banking customers, 10 customers accepted that they
use transaction based services. Among them 70 percent use bill payment service and
60 percent fund transfer service and no customer of SBI is using prepaid mobile
recharge service of mobile banking.
311
Table 4.4.9
Multiple Response Analysis of utilization with respect to
Convenience services of credit card
Convenience services
of credit card
ICICI SBI
Response Percent
of cases
Response
N Percent N percent Percent
of cases
Cash withdrawal at
ATM
77 11.7 74.8% 61 12.5 75.3%
Cash advance at cash
point
16 2.4 15.5% 1 0.2 1.2%
Online shopping
63 9.6 61.2% 45 9.2 55.6%
Online Railway ticket
booking 70 10.6 68.0% 51 10.5 63.0%
E-statement
26 4.0 25.2% 15 3.1 18.5%
SMS alert
81 12.3 78.6% 71 14.6 87.7%
utility bill payment
38 5.8 36.9% 34 7.0 42.0%
Online management of
card
19 2.9 18.4% 6 1.2 7.4%
Auto debit facility
6 1.0 5.8% 4 0.8 4.9%
Payment option –
cash/cheque/draft
100 15.2 97.1% 81 16.6 100.0%
Payment through ATM
56 8.5 54.4% 36 7.4 44.4%
Payment through ECS
3 0.5 2.9% 2 0.4 2.5%
Drop facility
103 15.6 100.0 80 16.4 98.7%
Total
658 100.0 638.8 487 100.0 601.2%
Source: Primary data
The above table shows the usage of convenience services of credit card by
credit cardholders. Among 103 credit card holders of ICICI bank, 74.8 percent use
credit card for cash withdrawal at ATM, 61.2 percent for online shopping, 68 percent
312
for railway ticket booking and only 36.9 percent for utility bill payment. 78.2 percent
cardholders use SMS alert service, 25.2 percent e-statement and only 5.2 percent auto
debit facility. As for as payment option is concerned, 100 percent of the cardholders
are using cheque/cash/draft and drop box. 54.4 percent use ATM for payment of
credit card bill and only 2.9 percent are using ECS .
Among 81 credit card holders of SBI, 75.3 percent use credit card to withdraw
cash from ATM, 63 percent for railway ticket booking, 55.6 percent for online
shopping 87.7 percent use SMS alert, 78.5 percent use e-statement and 4.9 percent use
auto debit facility. 100 percent of credit card holders use cheque/cash/draft and 98.7
percent drop boxes for credit card bill payment, 44.4 percent use ATM for this
purpose and only 2.5 percent use ECS for credit card bill payment.
It is concluded that in both banks credit card holders besides using card for
purchases at point of sales are mainly using it for cash withdrawal at ATM, and for
railway ticket booking and their main payment option is cheque/cash/draft and drop
boxes. So, the bank should encourage them to use ATM and ECS for payment of their
credit card bill which will help them to avoid delay in payment of dues.
313
Table 4.4.10
Multiple Response Analysis of utilization with respect to
Value added services of credit card
Value added services
of credit card
ICICI SBI
Response Percent
of cases
Response
N Percent N percent Percent
of cases
Balance transfer facility
20 17.1% 24.1% 5 6.9% 9.6%
Dial –a- Draft facility
18 15.4% 21.7% 14 19.4% 26.9%
Personal loan on card
2 1.7% 2.4% 3 4.2% 5.8%
Interest free credit
period
77 65.8% 92.8% 50 69.4% 96.2%
Total
117 100.0% 141.0% 72 100.0% 138.5%
Source: Primary data
The above table reveals the utilization of value added services of credit card
by credit card holders.
In ICICI bank out of 103 credit cardholders, 82 cardholders accepted that they
use value added services. The service that is used by majority of the respondents is
interest free credit period (92.8%). Services such as balance transfer (24.1%) dial-a-
draft (21.7%), personal loan on card (2.4) are used by very few customers. In SBI
bank as well, only 52 credit and holders accepted that they are using value added
services of credit card. Majority of the customer (96.2%) use interest free credit
period. 26.9 percent use dial-a-draft facility and only 9.6 percent use balance transfer,
5.8 percent use personal loan on cards.
It is concluded that value added services are not utilized by majority of the
credit card holders. So the study banks should create more awareness about value
added services and should take necessary steps to encourage them to use this value
added services.
314
Table 4.4.11
Multiple Response Analysis of utilization with respect to
Benefit services of credit card
Benefit services of
credit card
ICICI SBI
Response Percent
of cases
Response
N Percent N percent Percent
of cases
Add on card facility
59 18.0% 61.5% 38 19.9% 56.7%
Temporary credit limit
enhancement 21 6.4% 21.9% 6 3.1% 9.0%
Permanent credit limit
enhancement 30 9.1% 31.3% 11 5.8% 16.4%
Self-set/monthly preset
limit 27 8.2% 28.1% 13 6.8% 19.4%
Limited lost card
liability
30 9.1% 31.3% 2 1.0% 3.0%
Revolving credit
facility
56 17.1% 58.3% 47 24.6% 70.1%
Cash back offer
18 5.5% 18.8% 14 7.3% 20.9%
Discount
29 8.8% 30.2% 6 3.1% 9.0%
Reward points
38 11.6% 39.6% 45 23.6% 67.2%
Fuel surcharge waiver
20 6.1% 20.8% 9 4.7% 13.4%
Total
328 100.0% 341.7% 191 100.0% 285.1%
Source: Primary data
The above table shows the utilization of benefit services of credit card by
credit card holders. From the sample of 103 credit card holders of ICICI bank, 96 card
holders accepted that they use benefit services of credit card. Among the various
benefit services, majority of the customers use, add on card facility (61.5%),
Revolving credit facility (58.3%). 39.6 percent of credit cardholders are using reward
points, 30.2 percent discount and 31.3 percent permanent credit limit enhancement
and only 21.9 percent are using temporary credit limit enhancement facility.
315
In SBI, 67 credit card holders accepted that they are using benefit services.
Among them,70 percent are using revolving credit facility, 56.7 percent add on card
facility, and 67.2 percent are using reward points. Other services are used by only few
card holders that is temporary credit limit enhancement (9%), permanent credit limit
enhancement (16.4%) discount (9%), cash back offer (20.9%).
It reveals that in both banks majority of the customers use only add on card
facility, revolving credit facility and reward points among various benefit service.
This may be due to lack of awareness, so the banks should create awareness about
benefit services and adopt appropriate promotional strategy to promote their product.
316
Table 4.4.12
Multiple Response Analysis of utilization with respect to
Insurance services of credit card
Insurance services of
credit card
ICICI SBI
Response Percent
of cases
Response
N Percent N percent Percent
of cases
Personal accident cover
29 22.7% 42.0% 5 8.5% 11.9%
Credit shield cover
49 38.3% 71.0% 31 52.5% 73.8%
Life insurance on
cardholder
31 24.2% 44.9% 14 23.7% 33.3%
Life insurance on add
on card 6 4.7% 8.7% 0 0.0% 0.0%
Purchase protection
13 10.2% 18.8% 9 15.3% 21.4%
Total
128 100.0% 185.5% 59 100.0% 140.5%
Source: Primary data
The above table shows the usage of insurance services by credit cardholders.
Among 103 credit card holders of ICICI bank, only 69 card holders accepted that they
are using insurance services. 42 percent of them are using personal accident cover, 71
percent credit shield cover, 44.9 percent life insurance on card and 18.8 percent are
using purchase protection.
In SBI among 81 credit card holders, 42 card holders accepted that they
are using insurance service. 73.8 percent of them are using credit shield cover,
33.3 percent life insurance on card, 21.4 percent purchase protection and only
11.9 percent are using personal accident cover.
It reveals that among various insurance services provided through credit
card majority of the card holder use credit shield cover.
317
Table 4.4.13
Multiple Response Analysis of utilization with respect to
Any Branch Banking services
Any Branch Banking
services
ICICI SBI
Response Percent
of cases
Response
N Percent N percent Percent
of cases
Deposit of cash at non-
home branch 20 19.4% 71.4% 27 26.5% 56.3%
Deposit of cheque &
clearing instrument 14 13.6% 70.0% 20 19.6% 41.7%
Cash withdrawal at
non-home branch 15 14.6% 75.0% 15 14.7% 31.3%
Balance enquiry at non-
home branch 14 13.6% 70.0% 4 4.0% 14.3%
Get statement of a/c
10 9.7% 50.0% 8 7.8% 28.6%
Pass book updation
13 12.6% 65.0% 18 17.6% 64.3%
Fund transfer to third
party a/c at another
CBS branch
17 16.5% 85.0% 10 9.8% 35.7%
Total
103 100.0% 486.4% 102 100.0% 272.2%
Source: Primary data
The above table shows the usage of services by any branch banking
customers. Among 20 any branch banking customers, 100 percent of them are using
any branch banking facility for cash deposit, 65 percent for cheque and other clearing
instrument deposit, 55 percent for cash withdrawal, 65 percent for fund transfer to
third party a/c, 60 percent for pass book updating. Among 28 any branch banking
customers of SBI, 96.4 percent use any branch banking facility for cash deposit 71.4
percent for deposit of cheque and other clearing instrument, 53.6 percent for cash
withdrawal, 64.3 percent for pass book updating and only 38.7 percent use any
banking facility for fund transfer. It reveals that the utilization of any branch banking
services by ICICI customers is higher than SBI
318
4.5 INFERENTIAL ANALYSIS ON SAMPLES
HYPOTHESIS- I
Null Hypothesis: There is no significant association between occupation and
ICICI Bank Customers’ Utilization with respect to various
dimensions of ATM-cum-Debit card services
Table 4.5.1 Chi-Square test for significant association between occupation and
ICICI Bank customers’ Utilization with respect to various dimensions of ATM-
cum-Debit card services
Dim
ensi
on
uti
liza
tio
n
Occupation
T
ota
l
C
hi-
squ
are
P
va
lue
Bu
sin
ess
men
pro
fess
i
on
al
Go
vt.
emp
loy
e
e
Pri
va
te
emp
loy
e
e Reti
red
pers
on
oth
ers
Co
nv
enie
nce
serv
ices
Yes 15
(50.0)
11
(42.3)
37
(50.0)
37
(42.0)
5
(313)
10
(35.7)
115
3.523
0.620 No 15
(50.0)
15
(57.7)
37
(50.0)
51
(58.0)
11
(68.8)
18
(64.3)
147
Total 30
26 74 88 16 28 262
Val
ue
ad
ded
serv
ices
Yes 11
(36.7)
8
(30.8)
17
(23.0)
25
(28.4)
1
(6.3)
6
(21.4)
68
6.254
0.282 No 19
(63.3)
18
(69.2)
57
(77.0)
63
(71.6)
15
(93.8)
22
(78.6)
194
Total 30
26 74 88 16 28 262
Ser
vic
es a
t
PO
S
Yes 27
(90.0)
23
(88.5)
46
(62.2)
59
(67.0)
7
(43.8)
16
(57.1)
178
18.693
0.002*** No 3
(10.0)
3
(11.5)
28
(37.8)
29
(33.0)
9
(56.3)
12
(42.9)
84
Total 30 26 74 88 16 28 262
Oth
er
serv
ices
Yes 16
(53.3)
8
(30.8)
5
(6.8)
10
(11.4)
2
(12.5)
0
(0.0)
41
47.750
0.000*** No 14
(46.7)
18
(69.2)
69
(93.2)
78
(88.6)
14
(87.5)
28
(100.0)
221
Total 30
26 74 88 16 28 262
Note: The value within brackets refers to column percentage
319
Since P value is greater than 0.05, the null hypothesis is accepted at 5% level of
significance with respect to convenience services and value added services at ATM.
Hence there is no significant association between occupation and utilization of ICICI
bank’s debit card holders with respect convenience and value added services at ATM.
Since P value is less than 0.01, the null hypothesis is rejected at 1% level of
significance with respect to services provided at POS and other services of debit card.
Hence, there is a highly significant association between occupation and utilization
with respect to services provided at POS and other services of debit card. It is
concluded that services provided at POS and services categorized under the head
‘other services’ are highly used by businessman and utilization of these services by
retired person is low compared to others. So the bank should take necessary steps to
increase the usage of services at POS and other services by every category of
customers.
320
HYPOTHESIS- II
Null Hypothesis: There is no significant association between occupation and SBI
Bank Customers’ Utilization with respect to various
dimensions of ATM-cum-Debit card services
Table 4.5.2 Chi-Square test for significant association between occupation and
SBI Bank customers’ Utilization with respect to various dimensions of ATM-
cum-Debit card services
Dim
ensi
on
Uti
liza
tio
n
occupation
Total
Chi-
squar
e
P value
Bu
sin
ess
men
pro
fess
i
on
al
Go
vt.
emp
loy
e
e
Pri
va
te
emp
loy
e
e Reti
red
pers
on
oth
ers
Co
nv
enie
nce
serv
ices
Yes 11
(39.3)
23
(46.9)
39
(47.0)
11
(26.8)
1
(8.3)
1
(14.3)
86
12.608
0.027** No 17
(60.7)
26
(53.1)
44
(53.0)
30
(73.2)
11
(91.7)
6
(85.7)
134
Total 28
49 83 41 12 7 220
Valu
e ad
ded
serv
ices
Yes 15
(53.6)
15
(30.6)
8
(9.6)
6
(14.6)
2
(16.7)
1
(14.3)
47
28.048
0.000*** No 13
(46.4)
34
(69.4)
75
(90.4)
35
(85.4)
10
(83.3)
6
(85.7)
173
Total 28
49 83 41 12 7 220
Serv
ices
at
PO
S
Yes 27
(96.4)
46
(93.9)
57
(68.7)
20
(48.8)
2
(16.7)
1
(14.3)
153
57.563
0.000*** No 1
(3.6)
3
(6.1)
26
(31.3)
21
(51.2)
10
(83.3)
6
(85.7)
67
Total 28 49 83 41 12 7 220
Oth
er s
erv
ices
Yes 16
(57.1)
6
(12.2)
7
(8.4)
1
(2.4)
1
(8.3)
1
(14.3)
32
48.786
0.000*** No 12
(42.9)
43
(87.8)
76
(91.6)
40
(97.6)
11
(91.7)
6
(85.7)
188
Total 28 49 83 41 12 7 220
Note: The value within brackets refers to column percentage
321
Since P value is less than 0.05, the null hypothesis is rejected at 5%
level of significance with respect to convenience services of ATM – cum –
Debit card. Hence there is a significant association between occupation and
utilization of SBI bank’s ATM-cum debit cardholders with respect to
convenience services. Since P value is less than 0.01, the null hypothesis is
rejected at 1% level of significance with respect to value added services at
ATM, services at POS and other services of debit card. Hence, there is a highly
significant association between occupation and utilization of SBI debit card
holders with respect to value added services, service at POS and other services
of debit card. It is concluded that convenience services at ATM are highly used
by government employees. Value added services at ATM services as POS and
other services are highly used by businessmen. So the SBI bank should take
necessary steps to promote its product and should try to increase usage of
various services by every category of customers through appropriate
promotional strategy.
322
HYPOTHESIS- III
Null Hypothesis: There is no significant association between occupation and
ICICI Bank customers’ Utilization with respect to various
dimensions of Internet banking services
Table 4.5.3 Chi-Square test for significant association between occupation and
ICICI Bank customers’ Utilization with respect to various dimensions of Internet
banking services
Dim
ensi
on
Uti
liza
tion
occupation
Total
Chi-
square
P value
Bu
sin
ess
men
pro
fess
io
nal
Govt.
emp
loyee
Pri
vate
emp
loyee
Ret
ired
per
son
oth
ers
Con
ven
ience
serv
ices
Yes 14
(60.9)
7
(43.8)
3
(21.4)
1
(6.7)
0
(0.0)
1
(25.0)
26
14.319
0.014** No 9
(39.1)
9
(56.3)
11
(78.6)
14
(93.3)
1
(100.0)
3
(75.0)
47
Total 23
16 14 15 1 4 73
Val
ue
add
ed
serv
ices
Yes 10
(43.5)
6
(37.5)
0
(0.0)
1
(6.7)
0
(0.0)
0
(0.0)
17
15.145
0.010** No 13
(56.5)
10
(62.5)
14
(100.0)
14
(93.3)
1
(100.0)
4
(100.0)
56
Total 23
16 14 15 1 4 73
Note: The value within brackets refers to column percentage
Since P value is less than 0.05, the null hypothesis rejected at 5% level of
significance with respect to dimensions of internet banking. Hence, there is a
significant association between occupation and utilization of ICICI bank’s Internet
banking customers with respect to dimensions of internet banking services. It is
concluded that the convenience services and value added services are highly used by
businessmen. Utilization of internet banking services by professionals, private
employees and Government employees is low. So the ICICI bank should adopt
323
appropriate promotional strategy to increase to usage of various dimensions of
internet banking services among every category of customers.
HYPOTHESIS- IV
Null Hypothesis: There is no significant association between occupation and SBI
Bank customers’ Utilization with respect to various dimensions
of Internet banking services
Table 4.5.4Chi-Square test for significant association between occupation and
SBI Bank customers’ Utilization with respect to various dimensions of Internet
banking services
Dim
ensi
on
Uti
liza
tion
Occupation
Tota
l
Chi-
square
P value
Bu
sin
ess
men
pro
fess
io
na
l
Gov
t.
Em
plo
ye
e
Pri
va
te
emp
loyee
Ret
ired
per
son
oth
ers
Co
nven
ience
serv
ices
Yes 16
(69.6)
1
(8.3)
0
(0.0)
0
(0.0)
0
(0.0)
0
(0.0)
17
29.354
0.000*** No 7
(30.4)
11
(91.7)
13
(100.0)
8
(100.0)
1
(100.0)
0
(0.0)
40
Total 23
12 13 8 1 0 57
Val
ue
add
ed
serv
ices
Yes 14
(60.9)
4
(33.3)
1
(7.7)
0
(0.0)
0
(0.0)
0
(0.0)
19
16.194
0.003*** No 9
(39.1)
8
(66.7)
12
(92.3)
8
(100.0)
1
(100.0)
0
(0.0)
38
Total 23
12 13 8 1 0 57
Note: The value within brackets refers to column percentage
Since P value, is less than 0.01, the null hypothesis is rejected at 1% level of
significance with respect to various dimensions of internet banking. Hence there is a
highly significant association between occupation and utilization of SBI bank’s net
banking users with respect to convenience and value added services. It is concluded
that convenience and value added services provided through net banking is highly
used by businessman. The utilization by other category of customers is very low. So,
the SBI banks should take necessary steps to improve the usage of convenience and
value added services through proper promotional strategy.
324
HYPOTHESIS- V
Null Hypothesis: There is no significant association between occupation and
ICICI Bank Customers’ Utilization with respect to various
dimensions of Mobile banking services
Table 4.5.5 Chi-Square test for significant association between occupation and
ICICI Bank customers’ Utilization with respect to various dimensions of Mobile
banking services
Dim
ensi
on
Uti
liza
tion
Occupation
Tota
l
Chi-
square
P
value
Bu
sin
ess
men
pro
fess
io
nal
Govt.
emp
loyee
Pri
vate
emp
loyee
Ret
ired
per
son
oth
ers
Info
rmat
ion
bas
ed
serv
ices
Yes 1
(25.0)
3
(100.0)
3
(30.0)
6
(60.0)
0
(0.0)
1
(100.0)
14
7.975
0.158 No 3
(75.0)
0
(0.0)
7
(70.0)
4
(40.0)
1
(100.0)
0
(0.0)
15
Total 4
3 10 10 1 1 29
Fin
anci
al
tran
sact
ion
bas
ed
serv
ices
Yes 1
(25.0)
1
(33.3)
4
(40.0)
3
(30.0)
0
(0.0)
0
(0.0)
9
1.356
0.929 No 3
(75.0)
2
(66.7)
6
(60.0)
7
(70.0)
1
(100.0)
1
(100.0)
20
Total 4
3 10 10 1 1 29
Note: The value within brackets refers to column percentage
Since P value is greater than 0.05 the null hypothesis is accepted at 5% level
of significance with respect to dimensions of mobile banking services. Hence there is
no significant association between occupation and utilization of ICICI bank’s mobile
banking customers with respect to various dimensions of mobile banking service. It is
concluded that occupation has no influence on utilization with respect to dimension of
mobile banking services.
325
HYPOTHESIS- VI
Null Hypothesis: There is no significant association between occupation and SBI
Bank Customers’ Utilization with respect to various
dimensions of Mobile banking services
Table 4.5.6 Chi-Square test for significant association between occupation and
SBI Bank customers’ Utilization with respect to various dimensions of Mobile
banking services
Dim
ensi
on
Uti
liza
tion
Occupation
Tota
l
Chi-
square
P
value
Bu
sin
ess
men
pro
fess
io
nal
Govt.
emp
loyee
Pri
vate
emp
loyee
Ret
ired
per
son
oth
ers
Info
rmat
ion
bas
ed
serv
ices
Yes 0
(0.0)
7
(63.6)
5
(62.5)
3
(60.0)
0
(0.0)
0
(0.0)
15
1.581
0.664 No 0
(0.0)
4
(36.4)
3
(37.5)
2
(40.0)
1
(100.0)
0
(0.0)
10
Total 0
11 8 5 1 0 25
Fin
anci
al
tran
sact
ion
bas
ed
serv
ices
Yes 0
(0.0)
5
(45.5)
0
(0.0)
1
(20.0)
0
(0.0)
0
(0.0)
6
5.662
0.129 No 0
(0.0)
6
(54.5)
8
(100.0)
4
(80.0)
1
(100.0)
0
(0.0)
19
Total 0
11 8 5 1 0 25
Note: The value within brackets refers to column percentage
Since P value is greater than 0.05, the null hypothesis accepted at 5% level of
significance with respect to dimensions of mobile banking services. Hence, there is no
significant association between occupation and utilization of SBI bank’s mobile
banking customers with respect to dimensions of mobile banking services.
326
HYPOTHESIS- VII
Null Hypothesis: There is no significant association between occupation and
ICICI Bank customers’ Utilization with respect to various
dimensions of Credit card services
Table 4.5.7 Chi-Square test for significant association between occupation and
ICICI Bank Customers’ utilization with respect to various dimensions of Credit
card services
Dim
ensi
on
Uti
liza
tion
Occupation
Tota
l
Chi-
square
P value
Bu
sin
ess
men
pro
fess
io
nal
Govt.
emp
loyee
Pri
vate
emp
loyee
R
etir
ed
Per
son
oth
ers
Con
ven
ience
serv
ices
Yes 9
(69.2)
6
(50.0)
1
(3.2)
10
(23.3)
0
(0.0)
0
(0.0)
26
26.631
0.000*** No 4
(30.8)
6
(50.0)
30
(96.8)
33
(76.7)
0
(0.0)
4
(100.0)
77
Total 13
12 31 43 0 4 103
Val
ue
add
ed
serv
ices
Yes 9
(69.2)
11
(91.7)
21
(67.7)
33
(76.7)
0
(0.0)
3
(75.0)
77
2.927
0.570 No 4
(30.8)
1
(8.3)
10
(32.3)
10
(23.3)
0
(0.0)
1
(25.0)
26
Total 13 12 31 43 0 4 103
Ben
efit
bas
ed
serv
ices
Yes 7
(53.8)
8
(66.7)
17
(54.8)
22
(51.2)
0
(0.0)
2
(50.0)
56
0.945
0.918 No 6
(46.2)
4
(33.3)
14
(45.2)
21
(48.8)
0
(0.0)
2
(50.0)
47
Total 13 12 31 43 0 4 103
Insu
rance
serv
ices
Yes 7
(53.8)
7
(58.3)
10
(32.3)
22
(51.2)
0
(0.0)
3
(75.0)
49
5.106
0.277 No 6
(46.2)
5
(41.7)
21
(67.7)
21
(48.8)
0
(0.0)
1
(25.0)
54
Total 13 12 31 43 0 4 103
Note: The value within brackets refers to column percentage
327
Since P value is less than 0.01, the null hypothesis is accepted at 1% level of
significance with respect to convenience services of credit card. Hence there is a
highly significant association between occupation and utilization of ICICI bank’s
credit card holders with respect to convenience services. It reveals that businessmen
are using more convenience services. Since P value is greater than 0.05, the null
hypothesis is accepted at 5% level of significance, with respect to value added
services, benefit services and insurance services. Hence there is no significant
association between occupation and utilization of ICICI bank’s credit card holders
with respect to value added services, benefit services and insurance services of credit
card.
328
HYPOTHESIS- VIII
Null Hypothesis: There is no significant association between occupation and SBI
Bank Customers’ Utilization with respect to various
dimensions of Credit card services
Table 4.5.8 Chi-Square test for significant association between occupation and
SBI Bank Customers’ utilization with respect to various dimensions of Credit
card services
Dim
ensi
on
Uti
liza
tion
Occupation
Tota
l
Chi-
square
P value
Bu
sin
ess
men
pro
fess
io
nal
G
ovt.
emp
loyee
P
rivate
emp
loyee
Ret
ired
per
son
oth
ers
Conv
enie
nce
serv
ices
Yes 5
(50.0)
3
(12.5)
1
(2.6)
6
(66.7)
0
(0.0)
0
(0.0)
15
27.328
0.000*** No 5
(50.0)
21
(87.5)
37
(97.4)
3
33.3)
0
(0.0)
0
(0.0)
66
Total 10
24 38 9 0 0 81
Val
ue
add
ed
serv
ices
Yes 8
(80.0)
16
(66.7)
19
(50.0)
7
(77.8)
0
(0.0)
0
(0.0)
50
4.855
0.183 No 2
(20.0)
8
(33.3)
19
(50.0)
2
(22.2)
0
(0.0)
0
(0.0)
31
Total 10
24 38 9 0 0 81
Ben
efit
bas
ed
serv
ices
Yes 8
(80.0)
18
(75.0)
16
(42.1)
5
(55.6)
0
(0.0)
0
(0.0)
47
8.799
0.032** No 2
(20.0)
6
(25.0)
22
(57.9)
4
(44.4)
0
(0.0)
0
(0.0)
34
Total 10
24 38 9 0 0 81
Insu
rance
ser
vic
es
Yes 7
(70.0)
8
(33.3)
13
(34.2)
3
(33.3)
0
(0.0)
0
(0.0)
31
4.867
0.182 No 3
(30.0)
16
(66.7)
25
(65.8)
6
(66.7)
0
(0.0)
0
(0.0)
50
Total 10
24 38 9 0 0 81
Note: The value within brackets refers to column percentage
329
Since P value is less than 0.01, the null hypothesis is rejected at 1%
level of significance with respect to convenience services of credit card. Hence
there is a highly significant association between occupation and utilization of
SBI bank’s credit cardholders with respect to convenience services. Since P
value is less than 0.05, the null hypothesis is rejected at 5% level of
significance with respect to benefit service. Hence there is a significant
association between occupation and utilization of SBI bank’s credit card
holders with respect benefit services of credit card. Since P value is higher than
0.05, the null hypothesis is accepted at 5% level of significance with respect to
value added service and insurance services. Hence there is no association
between occupation and utilization of SBI bank’s credit card holders with
respect to value added services and insurance services.
It is concluded that convenience services are highly used by private
employees and benefit services are highly used by professionals and
businessmen. The occupation has no influence on the utilization of value added
service and insurance services of credit card.
330
HYPOTHESIS- IX
Null Hypothesis: There is no significant association between monthly income
and ICICI Bank customers’ Utilization with respect to various
dimensions of ATM- cum- Debit card services
Table 4.5.9 Chi-Square test for significant association between monthly income
and ICICI Bank Customers’ Utilization with respect to various dimensions of
ATM-cum-Debit card services
Dim
ensi
on
Uti
liza
tio
n
Monthly income(Rs)
Total
Chi-
square
P value
<15000
15000-
25000
25000-
40000
40000-
60000
>60000
Co
nv
enie
nce
serv
ices
Yes 26
(41.3)
43
(41.0)
28
(53.8)
14
(45.2)
4
(36.4)
115
2.910
0.573 No 37
(58.7)
62
(59.0)
24
(46.2)
17
(54.8)
7
(63.6)
147
Total 63
105 52 31 11 262
Val
ue
ad
ded
serv
ices
Yes 8
(12.7)
28
(26.7)
16
(30.8)
12
(38.7)
4
(36.4)
68
9.660
0.047**
No 55
(87.3)
77
(73.3)
36
(69.2)
19
(61.3)
7
(63.6)
194
Total 63
105 52 31 11 262
Ser
vic
es a
t
PO
S
Yes 28
(44.4)
71
(67.6)
42
(80.8)
27
(87.1)
10
(90.9)
178
27.778
0.000*** No 35
(55.6)
34
(32.4)
10
(19.2)
4
(12.9)
1
(9.1)
84
Total 63
105 52 31 11 262
Oth
er s
erv
ices
Yes 5
(7.9)
5
(4.8)
13
(25.0)
14
(45.2)
4
(36.4)
41
39.743
0.000*** No 58
(92.1)
100
(95.2)
39
(75.0)
17
(54.8)
7
(63.6)
221
Total 63
105 52 31 11 262
Note: The value within brackets refers to column percentage
Since P value is greater than 0.05, the null hypothesis is accepted at 5% level
of significance with respect to convenience services of ATM - cum - Debit card at
331
ATM. Hence there is no significant association between monthly income and
utilization of ICICI bank’s debit card holders with respect to convenience services
provided as ATM. Since P value is less than 0.05, the null hypothesis is rejected at
5% level of significance with respect to value added services provided at ATM.
Hence there is a significant association between monthly income and utilization of
ICICI bank’s debit card holders with respect to value added services at ATM.
Since P value is less than 0.01, the null hypothesis is rejected at 1% level of
significance with respect to services at POS and other services of debit card. Hence
there is a highly significant association between monthly income and utilization of
ICICI bank’s debit card holders with respect to services at POS and other services of
debit card.
It is concluded that services at POS are highly utilized by customers whose
monthly income is above Rs.25000 and other debit card services are highly used by
customers in the income group of Rs.40,000 – 60,00. So the ICICI bank should
examine the utilization level of customers in different monthly income group and take
necessary steps to encourage customers in the lower income group for more card
usage through appropriate promotional strategy.
332
HYPOTHESIS- X
Null Hypothesis: There is no significant association between monthly income
and SBI Bank customers’ Utilization with respect to various
dimensions of ATM-cum-Debit card services
Table 4.5.10 Chi-Square test for significant association between monthly income
and SBI Bank Customers’ Utilization with respect to various dimensions of
ATM-cum-Debit card services
Dim
ensi
on
Uti
liza
tion
Monthly income(Rs)
Tota
l
Chi-
square
P value
<
150
00
15000
-
250
00
2500
0-
4000
0l
4000
0-
6000
0
>6000
0
Con
ven
ience
serv
ices
Yes 12
(17.6)
21
(42.0)
34
(58.6)
9
(39.1)
10
(47.6)
86 23.243
0.000***
No 56
(82.4)
29
(58.0)
24
(41.4)
14
(60.9)
11
(52.4)
134
Total 68
50 58 23 21 220
Val
ue
add
ed
serv
ices
Yes 2
(2.9)
10
(20.0)
14
(24.1)
8
(34.8)
13
(61.9)
47
37.069
0.000***
No 66
(97.1)
40
(80.0)
44
(75.9)
15
(65.2)
8
(38.1)
173
Total 68
50 58 23 21 220
Ser
vic
es a
t P
OS
Yes 23
(33.8)
35
(70.0)
51
(87.9)
23
(100.0)
21
(100.0)
153
69.499
0.000*** No 45
(66.2)
15
(30.0)
7
(12.1)
0
(0.0)
0
(0.0)
67
Total 68
50 58 23 21 220
Oth
er s
ervic
es
Yes 1
(1.5)
1
(2.0)
13
(22.4)
4
(17.4)
13
(61.9)
32
56.616
0.000*** No 67
(98.5)
49
(98.0)
45
(77.6)
19
(82.6)
8
(38.1)
188
Total 68
50 58 23 21 220
Note: The value within brackets refers to column percentage
333
Since P value is less than 0.01, the null hypothesis is rejected at 1% level of
significance with respect to convenience services, value added services, services at
POS and other services of debit card. Hence there is a highly significant association
between monthly income and utilization of SBI bank’s debit card holders with respect
to various dimensions of ATM - cum - debit card service. It is concluded that
convenience services are highly used by the income group of Rs.25,000-40,000, value
added services are highly used by income group of above Rs.60,000. Services at POS
through debit card are highly used by customers whose income is above Rs.40,000.
Services that are listed in the category “other services” are highly utilized by
customers whose monthly income is above Rs.60,000. So the SBI bank should take
necessary steps to increase usage of lower income group for achieving higher
penetration of its product.
334
HYPOTHESIS- XI
Null Hypothesis: There is no significant association between monthly income
and ICICI Bank customers’ Utilization with respect to various
dimensions of Internet banking services
Table 4.5.11 Chi-Square test for significant association between monthly income
and ICICI Bank Customers’ Utilization with respect to dimensions of Internet
banking services
Dim
ensi
on
Uti
liza
tion
Monthly income(Rs) Total Chi-
square
P value
<15000 15000-
25000
25000-
40000l
40000-
60000
>60000
Con
ven
ience
serv
ices
Yes 1
(16.7)
0
(0.0)
6
(28.6)
12
(48.0)
7
(63.6)
26 12.364 0.015**
No 5
(83.3)
10
(100.0)
15
(71.4)
13
(52.0)
4
(36.4)
47
Total 6
10 21 25 11 73
Val
ue
add
ed
serv
ices
Yes 0
(0.0)
0
(0.0)
7
(33.3)
7
(28.0)
3
(27.3)
17
6.452
0.168 No 6
(100.0)
10
(100.0)
14
(66.7)
18
(72.0)
8
(72.7)
56
Total 6
10 21 25 11 73
Note: The value within brackets refers to column percentage
Since P value is less than 0.05, the null hypothesis is rejected at 5% level of
significance with respect to convenience services of internet banking. Hence there is a
significant association between monthly income and utilization of ICICI bank’s net
banking users with respect to convenience services. Since P value is greater than 0.05,
the null hypothesis is accepted at 5% level of significance. Hence there is no
significant association between monthly income and utilization with respect to value
added services. It is concluded that the conveniences services are highly used by
income group of above Rs.60,000 and monthly income has no influence on utilization
of value added services of net banking.
So, the bank should take necessary steps to encourage low income group of
customers and the customers whose income is below Rs.40,000 for higher satisfaction
and penetration .
335
HYPOTHESIS- XII
Null Hypothesis: There is no significant association between monthly income
and SBI Bank Customers’ Utilization with respect to various
dimensions of Internet banking services
Table 4.5.12Chi-Square test for significant association between monthly income
and SBI Bank Customers’ Utilization with respect to various dimensions of
Internet banking services
Note: The value within brackets refers to column percentage
Since P value is less than 0.01, the null hypothesis is rejected at 1% level of
significance with respect to dimensions of internet banking. Hence there is a highly
significant association between monthly income and utilization of SBI bank’s net
banking users with respect to dimensions of internet banking services. It is concluded
that the utilization of income group of above Rs.60,000 is higher than other income
group. So, the bank should take necessary steps to encourage lower income group and
customers whose is between 25,000 and 40,000 to use more services of net banking.
Dim
ensi
on
Uti
liza
tio
n
Monthly income(Rs)
To
tal
Chi-
square
P value
<15000
15000-
25000
25000-
40000l
40000-
60000
>60000
Co
nv
enie
nce
serv
ices
Yes 0
(0.0)
0
(0.0)
0
(0.0)
1
(6.3)
16
(84.2)
17
40.450
0.000*** No 1
(100.0)
4
(100.0)
17
(100.0)
15
(93.8)
3
(15.8)
40
Total 1
4 17 16 19 57
Val
ue
add
ed
serv
ices
Yes 0
(0.0)
0
(0.0)
2
(11.8)
3
(18.8)
14
(73.7)
19
21.511
0.000*** No 1
(100.0)
4
(100.0)
15
(88.2)
13
(81.3
5
(26.3)
38
Total 1 4 17 16 19 57
336
HYPOTHESIS- XIII
Null Hypothesis: There is no significant association between monthly income
and ICICI Bank customers’ Utilization with respect to various \
dimensions of Mobile banking services
Table 4.5.13 Chi-Square test for significant association between monthly income
and ICICI Bank Customers’ utilization with respect to various dimensions of
Mobile banking services
Dim
ensi
on
Uti
liza
tio
n
Monthly income(Rs)
To
tal
Chi-
square
P value
<15000 15000-
25000
25000-
40000l
40000-
60000
>6000
0
Info
rmat
ion
base
d
serv
ices
Yes 2
(100.0)
6
(42.9)
3
(33.3)
3
(75.0)
0
(0.0)
14
4.256
0.235 No 0
(0.0)
8
(57.1)
6
(66.7)
1
(25.0)
0
(0.0)
15
Total 2
14 9 4 0 29
Fin
an
cial
tran
sact
ion
base
d
serv
ices
Yes 0
(0.0)
4
(28.6)
3
(33.3)
2
(50.0)
0
(0.0)
9
1.634
0.652 No 2
(100.0)
10
(71.4)
6
(66.7)
2
(50.0)
0
(0.0)
20
Total 2
14 9 4 0 29
Note: The value within brackets refers to column percentage
Since P value is greater than 0.05, the null hypothesis is accepted at 5% level
of significance, with respect to dimensions of mobile banking services. Hence there is
no significant association between monthly income and utilization of ICICI banks’
mobile banking customers with respect to dimensions of mobile banking services. It is
concluded the monthly income has no influence on utilization of various dimensions
of mobile banking services.
337
HYPOTHESIS- XIV
Null Hypothesis: There is no significant association between monthly income
and SBI Bank customers’ Utilization with respect to various
dimensions of Mobile banking services
Table 4.5.14 Chi-Square test for significant association between monthly income
and SBI Bank Customers’ utilization with respect to various dimensions of
Mobile banking services
Dim
en
sio
n
Uti
liza
tio
n
Monthly income(Rs)
To
tal
Chi-
square
P value
<15000
15000-
25000
25000-
40000l
40000-
60000
>60000
Info
rmat
ion
base
d
serv
ices
Yes 0
(0.0)
3
(60.0)
11
(78.6)
1
(33.3)
0
(0.0)
15
7.401
0.060
No 3
(100.0)
2
(40.0)
3
(21.4)
2
(66.7)
0
(0.0)
10
Total 3
5 14 3 0 25
Fin
ancia
l
tran
sact
ion b
ase
d
serv
ices
Yes 0
(0.0)
1
(20.0)
4
(28.6)
1
(33.3)
0
(0.0)
6
1.295
0.730 No 3
(100.0)
4
(80.0)
10
(71.4)
2
(66.7)
0
(0.0)
19
Total
3
5
14
3
0
25
Note: The value within brackets refers to column percentage
Since P value is greater than 0.05 the null hypothesis is accepted at 5% level
of significance with respect to dimensions of mobile banking services. Hence there is
no significant association between monthly income and utilization of SBI bank’s
mobile banking customers with respect to dimension of mobile banking services. It is
concluded that monthly income has no influence on utilization of mobile banking
services.
338
HYPOTHESIS- XV
Null Hypothesis: There is no significant association between monthly income
and ICICI Bank customers’ Utilization with respect to various
dimensions of Credit card services
Table 4.5.15 Chi-Square test for significant association between monthly income
and ICICI Bank Customers’ utilization with respect to various dimensions of
Credit card services
Dim
ensi
on
Uti
liza
tion
Monthly income(Rs)
Total
Chi-
square
P value
<15000
15000-
25000
25000-
40000l
40000-
60000
>60000
Co
nven
ience
serv
ices
Yes 1
(11.1)
3
(5.8)
9
(33.3)
7
(77.8)
6
(100.0)
26
43.271
0.000*** No 8
(88.9)
49
(94.2)
18
(66.7)
2
(22.2)
0
(0.0)
77
Total 9
52 27 9 6 103
Val
ue
add
ed
serv
ices
Yes 7
(77.8)
37
(71.2)
20
(74.1)
8
(88.9)
5
(83.3)
77
1.594
0.810 No 2
(22.2)
15
(28.8)
7
(25.9)
1
(11.1)
1
(16.7)
26
Total 9
52 27 9 6 103
Ben
efit
bas
ed
serv
ices
Yes 4
(44.4)
27
(51.9)
13
(48.1)
8
(88.9)
4
(66.7)
56
5.592
0.232 No 5
(55.6)
25
(48.1)
14
(51.9)
1
(11.1)
2
(33.3)
47
Total 9
52 27 9 6 103
Insu
rance
serv
ices
Yes 8
(88.9)
18
(34.6)
12
(44.4)
6
(66.7)
5
(83.3)
49
14.158
0.007*** No 1
(11.1)
34
(65.4)
15
(55.6)
3
(33.3)
1
(16.7)
54
Total 9
52 27 9 6 103
Note: The value within brackets refers to column percentage
Since P value is less than 0.01, the null hypothesis rejected at 1% level of
significance with respect to convenience services and insurance services of credit
339
card. Hence there is a highly significant association between monthly income and
utilization of ICICI bank’s credit card holders with respect to convenience services
and insurance services of credit card.
Since P value is greater than 0.05, the null hypothesis is accepted at 5% level
of significance with respect to value added services and benefit services of credit card.
Hence there is no significant association between monthly income and utilization of
ICICI bank’s credit card holders with respect to value added services and benefit
services.
It is concluded that convenience services and Insurance services of credit card
is highly used by the cardholders whose income is above Rs.60,000. So the bank
should take necessary to find out the reason for low utilization of services by lower
income group and adopt appropriate strategy to improve the usage.
340
HYPOTHESIS- XVI
Null Hypothesis: There is no significant association between monthly income
and SBI Bank customers’ Utilization with respect to various
dimensions of Credit card services
Table 4.5.16 Chi-Square test for significant association between monthly
income and SBI Bank Customers’ utilization with respect to various dimensions
of Credit card services
Dim
ensi
on
Uti
liza
tio
n
Monthly income(Rs)
To
tal
Chi-
square
P value
<15000
15000-
25000
25000-
40000l
40000-
60000
>60000
Co
nv
enie
nce
serv
ices
Yes 0
(0.0)
3
(11.1)
5
(13.2)
4
(40.0)
3
(100.0)
15
18.646
0.001*** No 3
(100.0)
24
(88.9)
33
(86.8)
6
(60.0)
0
(0.0)
66
Total 3
27 38 10 3 81
Val
ue
ad
ded
serv
ices
Yes 2
(66.7)
15
(55.6)
24
(63.2)
6
(60.0)
3
(100.0)
50
2.372
0.668 No 1
(33.3)
12
(44.4)
14
(36.8)
4
(40.0)
0
(0.0)
31
Total 3
27 38 10 3 81
Benef
it b
ase
d
serv
ices
Yes 1
(33.3)
12
(44.4)
25
(65.8)
6
(60.0)
3
(100.0)
47
5.922
0.205 No 2
(66.7)
15
(55.6)
13
(34.2)
4
(40.0)
0
(0.0)
34
Total 3
27 38 10 3 81
Insu
ran
ce
serv
ices
Yes 0
(0.0)
5
(18.5)
16
(42.1)
7
(70.0)
3
(100.0)
31
15.656
0.004***
No 3
(100.0)
22
(81.5)
22
(57.9)
3
(30.0)
0
(0.0)
50
Total 3
27 38 10 3 81
Note: The value within brackets refers to column percentage
Since P value is less 0.01, the null hypothesis is rejected at 1% level of
significance with respect to convenience services and insurance services of credit
card. Hence, there is a highly significant association between income group and
341
utilization of SBI bank’s credit card holders with respect of convenience services and
insurance services. Since P value is greater than 0.05 the null hypothesis is accepted at
5% level of significance with respect to value added services and benefit based
services of credit card. Hence there is no significant association between monthly
income and utilization of credit card holders with respect to value added services and
benefit based services. It is concluded that convenience services and insurance
services are highly used by higher income group whose earning is above Rs.60,000
and monthly income has no influence on the utilization of value added services and
benefit based services of credit card.
342
SUMMARY
This chapter analyses the data pertaining to awareness and utility of e-
banking services. The e-banking products that offer multiple services are only
taken for analyses such as ATM - cum - debit card, credit card, internet
banking, mobile banking and any branch banking. The services of each product
have been classified. Based on the classification customers’ awareness and
utilization were evaluated by using yes/no pattern, giving one point for yes
response and zero for no response. Multiple response analysis has been used to
analyse the customer’s awareness and utilization of e-banking services.
The multiple response analysis of awareness of ATM – cum – debit card
holders with respect to convenience services reveals that majority of the
respondents in both SBI and ICICI bank are aware of convenience services
offered at ATM. Besides basic convenience services such as balance enquiry
(100%), cash withdrawal (100%), the services that are known to majority of the
debit card holders, in ICICI are: obtain statement of a/c (79.8%), deposit of
cash (77.1%), Fast cash (64.9%), cheque book request (46.2%). In SBI as well
all debit card holders are aware of basic convenience services such as balance
enquiry and cash withdrawal. Besides these services, the services that are
known to majority of SBI debit card holders are: obtain statement of a/c
(92.7%) change of PIN (88.2), fast cash (62.3%), cash deposit (45%).
The multiple response analysis of awareness of ATM - cum - debit card
holders reveals that 224 cardholders from ICICI and 164 cardholders from SBI
accepted that they are aware of value added services provided at ATM. It is
343
concluded that majority of cardholders from the study banks are aware of many
value added services and the services that are known to few card holders are
card to a/c transfer, educational, holy and trust donation payment services at
ATM.
The multiple response analysis of awareness of debit card holders with
respect to services available at point of sale reveals that 258 cardholders from
ICICI and 219 from SBI accepted that they are aware of services provided at
POS. Besides payment for purchases, the services that are known to majority of
the cardholders are: SMS alert (91.5%), Reward points (64.9%), discount
(45.6%) cash withdrawal at POS (47.9%). In SBI, SMS alert (94.5%), Reward
points (72.6%), Discount (35.2%), cash withdrawal at POS (28.8%).It is
concluded that in both banks the majority of the card holders aware of services
provided at POS. The awareness of cardholders towards certain POS services is
low such as cash withdrawal at POS, and surcharge waiver.
The multiple response analysis of awareness of SBI and ICICI banks
customers’ towards convenience services of Internet banking reveals that the
percentage respondents who are aware of convenience services of net banking
is very high in both banks. The analysis of awareness of customers towards
value added services of net banking reveals that 69 net banking users of ICICI
and 55 net banking users of SBI accepted that they are aware of value added
services. It reveals that in both banks the services that are known to majority of
net banking users are online railway ticket booking online air ticket booking,
344
online shopping, income and service tax payment and access credit details
through net banking.
The multiple response analysis of awareness of mobile banking users
towards transaction based services offered by SBI and ICICI reveals that
majority of mobile banking users of these two banks are aware of transaction
based services.
The analysis of awareness of credit card holders towards value added
services reveals that 87 respondents of ICICI bank and 54 respondents of SBI
accepted that they are aware of value added services of credit card and the
awareness of cardholders towards value added services of credit card is low. So
the banks should take appropriate steps to promote value added services of
credit card in this area of study.
The multiple response analysis of awareness of credit card holders
towards benefit services reveals that 102 cardholders of ICICI and 79
cardholders of SBI accepted that they are aware of benefit services of credit
card. It is concluded that comparatively ICICI bank’s credit card holder’s
awareness towards benefit services are higher than SBI as the percentage of
respondents aware of other benefit services such as temporary credit limit,
permanent credit limit, self -set/monthly preset limit, limited lost card liability
cover and fuel surcharge waiver is lesser than ICICI. So, the SBI should take
step to create awareness about these benefit services.
345
The analysis of awareness towards insurance services of credit card
offered by SBI and ICICI banks reveals that 71 cardholders of ICICI and only
57 cardholders of SBI have accepted that they are aware of insurance service of
credit card. It is concluded that in both banks the number cardholders who are
aware of insurance services is less and majority of them are aware of credit
shield cover, life insurance on cardholder and purchase protection service. So,
the study banks should take necessary steps to increase the cardholder’s
awareness towards insurance services of credit card.
The multiple response analysis of utilization of ATM – cum – debit card
holders with respect to convenience services at ATM reveals that 100 percent
of the debit card holders use ATM to withdraw cash and for balance enquiry. It
is concluded that services such as cash deposit through debit card and cheque
book request services are not used by many cardholders. Hence the banks
should take steps to encourage customers to use more and more convenience
services.
The multiple response analysis of utilization with respect to value added
services at ATM reveals that only 138 debit card holders of ICICI and 83 debit
card holders of SBI have accepted that they utilize value added services at
ATM. It is concluded that the percentage of debit cardholders using value
added services is very low. So the study banks should take necessary steps to
encourage customers to use more and more value added services at ATM
through appropriate promotional strategy.
346
The analysis of debit card holders’ usage with respect to services at POS
reveals that 214 card holders of ICICI and 197 card holders of SBI use debit
cards at point of sale. The services that are highly utilized by ICICI and SBI
card holders at POS are SMS alert and reward point services. It is concluded
that the services such as discount, surcharge waiver and cash withdrawal at
POS are not all used by many cardholders.
The analysis of utilization with respect to convenience services of net
banking reveals that 100 percent of net banking users utilize net banking for
accessing account information and the analysis of utilization with respect to
value added services of net banking reveals that 64 net banking users of ICICI
and 55 net banking users of SBI have accepted that they are utilizing value
added services. The main services utilized by Internet banking customers of
both banks are online railway ticket booking and online shopping other
services in the category of value added services are not used by many internet
banking customers. The analysis of utilization with respect to information
based mobile banking services reveals that majority of the mobile banking
customers (100%) of both banks use mobile banking for balance enquiry and
get last 5 transaction details. Services such as cheque status enquiry, get credit
card details, locate branch/ATM, status of service request services are utilized
by reasonable number of mobile banking users and the number of users of
transaction based services is low. So, the study banks should take necessary
steps to increase the usage of transaction based services by customers.
347
The analysis of utilization with respect to convenience services of credit
card reveals that besides usage of credit card for purchases, credit card holders
of SBI and ICICI are using it mainly for cash withdrawal, online railway ticket
booking. The multiple response analysis of utilization with respect to value
added services of credit card reveals that 83 credit card holders of ICICI and 52
credit card holders of SBI have accepted that they are utilizing value added
services. Among the various services the only service that is used by majority
of them is interest free credit period. Other value added services such as
balance transfer facility, dial-a-draft facility and personal loan on card are not
used by many cardholders. The multiple response analysis of utilization with
respect to benefit services and insurance services of credit card reveals that 96
card holders of ICICI and 67 card holders of SBI have accepted that they are
aware of benefit services of credit card. The services that are highly used by
ICICI and SBI card holders are add on card facility, Revolving credit facility
and Reward points. Among the various insurance services offered by banks
credit shield cover is highly utilized `by majority of the card holders.
HYPOTHESIS I to XXIV- test was conducted to find out whether there is
any association between age, gender, educational qualification and awareness
with respect to dimensions of e-banking, produces. In reveals that there is an
association between SBI ATM - cum - Debit card users’ awareness with
respect to convenience services, services at POS and age group. The awareness
of age group below 30 years and 30-40 years is higher than other age group.
The awareness of age group of above 50 years is very low. There is a
348
significant association between age group and awareness of ICICI bank’s net
banking customers towards value added services. The age groups of 30-40
years and 40- 50 years are highly aware of value added services. There is a
significant association between age group and awareness of ICICI bank’s credit
card holders with respect to benefit services. The awareness of younger age
group is lesser than other age group.
The test reveals that there is an association between gender and
awareness of ICICI bank’s debit card holders with respect to other services of
debit card. The awareness of male cardholder is higher than female. There is a
significant association between gender and awareness of ICICI bank’s net
banking customers with respect to convenience services and value added
services of net banking. The awareness of male is higher than female with
respect to convenience and value added services of net banking. The test also
reveals that there is an association between gender and awareness of SBI
bank’s credit cardholders with respect to insurance services of credit card and
the awareness of male is higher than female.
The next test shows that there is an association between educational
qualification and awareness of ICICI bank’s debit card holders with respect to
value added services at ATM. It reveals that the awareness of graduate is
higher. The test also reveals that there is an association between educational
qualification and awareness of SBI’s Internet banking customers with respect
to convenience services. It shows that the awareness of graduates is higher than
others. Another test shows there is an association between educational
349
qualification and awareness of ICICI bank’s credit card holders with respect to
insurance services. In SBI, the awareness of credit card holder with
professional qualification is higher than other with respect to convenience and
benefit services of credit card.
Hypothesis I to VIII - test was conducted to find out if there is any
association between occupation, monthly income and utility of various
dimensions of e-banking services offered by SBI and ICICI bank’s debit card
holders with respect to services at POS and other services of debit card. It is
concluded that these services are highly utilized by businessman there is an
association between occupation and utilization of SBI bank’s debit card holders
with respect to various dimensions of debit card services. It reveals that
convenience services at ATM are highly used by government employees
whereas value added services at POS and other services of debit card is highly
used by businessman.
The test of association between occupation and utilization of ICICI
bank’s net banking users reveals that the various dimensions of net banking
services are highly used by businessman. In SBI bank also the various
dimensions of net banking services are highly used businessman. The test to
find association between occupation and utilization of ICICI bank’s credit card
holders reveals that there is an association between occupation and utilization
with respect to convenience services. It was found that convenience services of
credit card are highly used by businessmen. As for as credit card services of
350
SBI reveals that convenience services are highly used by private employees
and benefit services are highly used by professionals.
HYPOTHESIS IX to XVI, test was conducted to find if there is any
association between monthly income and utilization of various dimensions of
e-banking services provided by SBI and ICICI banks. There is an association
between monthly income and utilization of SBI, ICICI bank’s debit card
holders with respect to dimensional of debit card services. In ICICI bank,
services at POS is highly utilized by customers whose monthly income is above
Rs,25,000 and other debit card services are highly used by customers in the
income group of Rs.40000 – 60000. In SBI, convenience services at ATM is
highly used by income group Rs.25000 – 40000 and the value added services
by the income group whose earning is above Rs.60000. The services listed in
the category of other services are highly by customers whose monthly income
is above Rs.60000.
The test further reveals that convenience services of net banking
provided by ICICI is highly utilized by customers whose income is above
Rs.60000. In SBI bank, both convenience and value added services of net
banking are highly used by customers whose income is higher than Rs.60000.
The test to find association between monthly income and utilization of various
dimensions of credit card services offered by SBI and ICICI reveals that there
is an association between monthly income and utilization of ICICI bank’s
credit card holders with respect to convenience services and insurance services
and these services are highly used by cardholders whose income is above
351
Rs.60,000. In SBI the convenience and insurance services are highly used by
cardholders whose income is above Rs.60000.
352
CHAPTER – V
PROBLEMS PERCEIVED BY E-BANKING CUSTOMERS
5.1. INTRODUCTION
In this chapter the e-banking customers’ perceptions of the various problems
are analysed and their views on resolution of problems and incidents are evaluated.
The perception of e-banking customers upon the problems experienced by them has
been evaluated based on the responses got on the following five point scale:
Strongly Agree – 5 Agree – 4 Neither agree nor disagree – 3
Disagree – 2 Strongly disagree – 1
Based on the above five point perception, the problems have been evaluated
with respect to each e-banking product separately. Hundred problems stated in the
questionnaire have been divided into the following eight categories and analysed
separately.
5.1.1. ATM related problems:
(1) ATMs are insufficient (2) ATMs not in prominent place (3) Insufficient cash
balance at ATMs (4) Lack of connectivity with more banks (5) Amount allowed to
drawn per day is low (6) Account debited cash not dispensed (7) Frequent card
blocking (8) safety situation around ATM not satisfactory (9) Heavy service charge
for cash withdrawal at other banks ATM (10) Heavy charges for fund transfer through
VISA money transfer and money send option.
5.1.2. Debit Card related problems
(1) Delay in giving final resolution for disputed transactions (2) Cancellation or
blocking of card takes more time (3) cancellation of card without assigning any
reason (4) Debiting cardholders a/c twice (5) It takes more than a month to get back
wrongly debited amount. (6) Getting ATM – cum – Debit card is time consuming (7)
Debit card for online purchase is risky (8) charges for issuing replacement card is
high.
353
5.1.3. Credit card related problems
(1)Hidden charges and basis of applying interest not known (2) Unwarranted
over draft allowed without consent (3) Unannounced slashing of credit limit (4)
Unsolicited credit card (5) New cards incepted and misused before they reach
customers (6) Banks are in the dock of using strong arm tactics to recover dues (7)
Difficulty in closure and blocking of lost card (8) Difficulty in returning the card
issued, (9) Charges for things that customer did not buy. (10) Debiting card a/c twice
(11) Drop boxes are not sufficient (12) Credit limit fixed is low. (13) Delay in issuing
new cards in the place of lost card (14) Delay in sending monthly statement of a/c
(15) Error in statement of a/c (16) Delay in sending duplicate statement of a/.c (17)
Providing unbelievable credit limit without reason (18) Reason for rejecting card
application not communicated (19) Sharing card holders information with subsidiaries
and affiliates (20) Receiving unwanted calls from agents (21) Receiving calls about
payment outstanding even after payment made (22) risk of giving card number when
buying online (23) Products purchased through card are costlier (24) Merchant
hesitate to accept credit card. (25) Merchant charge heavy transaction cost (26)
Merchant establishment are not displaying statement of “credit card accepted” (27)
Cash back offers and reward points are not much rewarding. (28) Usurious interest
charges on outstanding (29) Heavy fee on late payment. (30) Over limit credit charges
are high (31) Heavy charges for cash withdrawal at ATM (32) Finance charges are
very high on extended credit and cash advance (33) Foreign currency transaction fee
is high (34) surcharge on railway ticket reservation and petrol filling is high (35)
Cheque collection charges are high (36) High outstation cheque processing fee (37)
Replacement card fee is high (38) Statement retrieval fee is high (39) Charging late
payment fee for a short payment of few paise.
5.1.4. Net Banking Related Problems
(1) Information on bank’s website not current and updated (2) the websites are more
bank centric and less customer centric (3) The websites are not telling how a
particulars product or scheme is beneficial or profitable for a customer (4) Difficulty
in identifying the authenticity of bank’s e-mail (5) Difficulty in identifying the
difference between bank’s website and spoof website (6) Delay in getting back the
amount after cancellation of train ticket booked through net banking (7) Online Air
354
ticket booking through merchant side involves heavy fee (8) Fund transfer to any
other bank’s account through net banking is available in selected banks in selected
cities.
5.1.5. Mobile banking related problems:
(1) The permissible amount of financial transaction per day using mobile banking is
low (2) SMS alert on credit or debit transaction is only for higher value transactions
(3) Financial transactions are only possible on iphone.
5.1.6. RTGS, NEFT, ECS related Problems:
(1) RTGS, NEFT is enabled only in specific branches across India. (2) Non – credit or
delay in credit to the beneficiary a/c in case of NEFT transactions. (3) As a sponsor
bank of ECS debit and credit, banks collects heavy charges.
5.1.7 Any branch banking related problems:
(1) Permissible amount of deposit is low (2) Permissible amount of withdrawal is low.
(3) Huge charges for deposit of intercity cheques at non-home branch (4) Heavy
service charge for inter- city fund transfer to third party a/c at another CBS branch.
5.1.8. Problems related to fund
(1) Skimmers and cameras used by fraudsters to collect card information (2) Phishing
email seeking card information Pose trust worthy source. (3) Fake calls to wheedle
out financial information (4) Chances of capturing card number through charge slip is
high (5) Photo copies of card used by fraudster to make online purchase. (6)
Unsolicited credit card application raises chances of fraud. (7) Unauthorized person or
hacker traps data travelling across network (8) Information provided by card users to
the concerned website for online purchase are backed by fraudsters. (9) Through
cookies in the website fraudsters collect confidential information (10) Malicious or
malware software designed to steel password grows exponentially. (11) Malware
program in an undesirable website or an e-mail from unknown source is high (12)
viruses through free trail offers of software and services are high.
355
All the eight major classifications of problems have been analysed by using
five point Likert summated rating scale to evaluate the e-banking product user’s
problems perception.
5.2 DESCRIPTIVE ANALYSIS OF SAMPLES
Table 5.2.1
Respondents interest in complaining about the problem
Complaints
Frequency
Percentage
Yes
318
66.0
No
164
34.0
Total
482
100.0
Source: Primary data
The above table shows the e-banking user’s interest in contacting the bank for
their problems related to e-banking products and services. It reveals that 66 percent
were interested and able to contact the bank to report their problems and 34 percent
were not able to contact the bank to report their problems. It is concluded that 34
percent of the respondents were not able to make complaint or contact the bank
providing e-banking services.
356
Table 5.2.2
Reason for not making complaints
Reasons
Frequency
Percentage
Failure of previous effort
43 26.2
Busy with work
65 39.7
Automatic rectification
32 19.5
Other reason
24 14.6
Total
164 100.0
Source: Primary data
The above table shows the reasons for which the e-banking customers were unable
to contact the service providing bank for their problems or were not interested in
making complaint. It shows that 39.7 percent were busy with their work, 26.2 percent
felt that their previous efforts failed, 19.5 percent felt that the problems may be
rectified automatically by banks and 14.6 percent had other reasons such as customer
care centers always busy, unaware of proper channel for complaint making, fear of
tedious procedures involved, and lack of communication due to language problems. It
reveals that majority of the respondents were busy with their work and the failure of
previous effort had an impact on them. It is concluded that the study banks should
take necessary steps to keep the customers aware of the proper channels to make
complaints, simplify the grievance handling methods and to easily communicate in
their local language effectively for solving problems quickly.
357
Table 5.2.3
Methods of complaining
Methods
Frequency
Percentage
Through Help line
178
56.0
Internet
82
25.8
Other modes
58
18.2
Total
318
100.0
Source: Primary data
The above table reveals the e-banking product user’s method of approach to
make their complaints to the banks. It shows that 56 percent of the respondents gave
complaints through customer care helpline, 25.8 percent through internet, and 18.2
percent through other modes such as e-mail, SMS, and by directly meeting the bank
officials .It reveals that majority of the respondents gave complaints through customer
helpline. It is concluded that the banks should provide more helpline services for
handling problems quickly and proper training to customer care staffs so that they can
create friendly atmosphere when customers approach them with problems. This will
build confidence among customers on banks and better satisfaction.
358
Table 5.2.4
Number of times complaints made
Number of attempts
Frequency
Percentage
<3
208
65.4
3-6
65
20.4
>6
45
14.2
Total
318
100.0
Source: Primary data
The above table shows the number of times respondents approached the banks
regarding the problems. It represents that 65.4 percent approached less than three
times, 20.4 percent three to six times and 14.2 percent more than six times in an
attempt to give complaint to the service providing banks. It is concluded that majority
of the respondents have given complaints less than three times.
359
Table 5.2.5
Problems solved by banks
Problems solved
Frequency
Percentage
Yes
230
72.3
No
88
27.7
Total
318
100.0
Source: Primary data
The above table shows that 72.3 percent of problems were solved by banks,
27.7 percent were not solved properly. It reveals that the majority of problems were
solved but not all the problems solved by banks. It is concluded that the banks
providing e-banking services should take steps to solve all the problems of the
customers for better satisfaction in the study area.
360
Table 5.2.6
Duration of time required for the bank to solve the problem
Time taken
Frequency
Percentage
Within a day
22
9.6
Within a week
142
61.7
More than a week
66
28.7
Total
230
100.0
Source: Primary data
The above table shows the time required by banks to solve the problems of
their customers. It represents that 61.7 percent of the problems were solved within a
week, 28.7 percent more than a week and 9.6 percent within a day. It is concluded that
majority of the respondents’ problems, were solved by banks in a week. As the
expectation of every customer is quick redressal of their problems, the banks should
take immediate steps to solve problems immediately for better satisfaction.
361
Table 5.2.7
Overall problems of e-banking customers
Level of problem
Frequency
Percentage
Low
146 30.3
Moderate
193 40.0
High
143 29.7
Total
482 100.0
Source: Primary data
The above table shows the overall problems perceived by the respondents. It
represents that 40 percent of the respondent’s problems are moderate, 30.3 percent are
low and 29.7 percent are high. It is concluded that majority of the respondents faced
moderate problems in the study area.
FIG.5.2.7 OVER ALL PROBLEMS OF E-
BANKING CUSTOMERS
29.7
40
30.3
0
5
10
15
20
25
30
35
40
45
1 2 3 4 5 6 7 8 9 10
Percentage
Level of problem
362
Table 5.2.8
Overall satisfaction of respondents towards problem handling
Opinion about
satisfaction
Frequency
Percentage
Highly dissatisfied
45 9.3
Dissatisfied
122 25.3
Neither satisfied nor
dissatisfied
65 13.5
Satisfied
182 37.8
Highly satisfied
68 14.1
Total
482 100.0
Source: Primary data
The above table shows the overall satisfaction of respondents with reference to
problems handled by the study banks. It reveals that 37.8 percent were satisfied, 25.3
were dissatisfied, 13.5 percent neither satisfied nor dissatisfied and 9.3 percent highly
dissatisfied with reference to the problems handled by the study banks. It is
concluded that the overall satisfaction of respondents towards problem handling is
average. So the study banks should take necessary steps to examine and find an
alternative way of grievance redressal method for better satisfaction of e-banking
customers.
363
5.3 INFERENTIAL ANALYSIS ON SAMPLES
HYPOTHESIS- I
Null Hypothesis: There is no significant difference between banks and level of
Problem With respect to ATM
Table 5.3.1 Chi-Square test for significant difference between banks and level of
problems With respect to ATM
Bank Level of ATM related problems
Total
Chi-
square
value
P value
Low Moderate High
ICICI
111
(42.4)
97
(37.0)
54
(20.6)
262
13.921
0.001***
SBI
58
(26.4)
110
(50.0)
52
(23.6)
220
TOTAL
169
207
106
482
Note: The value within brackets refers to Row percentage.
Since the P value is less than 0.01, the null hypothesis is rejected at 1% level
of significance. Hence there is a highly significant difference between level of
problems perceived by ICICI bank’s ATM users and SBI bank’s ATM users. It is
concluded that the problems perceived by SBI customers are high and ICICI
customers are low with respect to ATM. So the SBI Bank should take necessary steps
to redress the grievances of its e-banking customers particularly problems with
respect to ATM.
364
HYPOTHESIS- II
Null Hypothesis: There is no significant difference between banks and level of
Problem with respect to credit card
Table 5.3.2 Chi-Square test for significant difference between banks and level of
problems with respect to credit card
Bank Level of credit card related
problems
Total
Chi-
square
value
P value
Low Moderate High
ICICI
41
(39.8)
40
(38.8)
22
(21.4)
103
8.806
0.012**
SBI
16
(19.8)
39
(48.1)
26
(32.1)
81
TOTAL
57
79
48
184
Note: The value within brackets refers to Row percentage.
Since the P value is less than 0.05, the null hypothesis is rejected at 5% level
of significance. Hence there is a significant difference between level of problems
perceived by ICICI bank’s credit cardholders and SBI bank’s credit card holders. It is
concluded the problems perceived by SBI credit cardholders are high and ICICI credit
card holders are low. So, the SBI bank should take necessary to redress the grievances
of its credit card holders quickly for high satisfaction.
365
HYPOTHESIS- III
Null Hypothesis: There is no significant difference between banks and level of
Problem with respect to Debit card
Table 5.3.3 Chi-Square test for significant difference between banks and level of
problems with respect to debit card
Bank Level of debit card related
problems
Total
Chi-
square
value
P value
Low Moderate High
ICICI
115
(43.9)
99
(37.8)
48
(21.4)
262
34.852
0.000***
SBI
41
(18.6)
120
(54.5)
59
(26.8)
220
TOTAL
156
219
107
482
Note: The value within brackets refers to Row percentage.
Since P value is less than 0.01, the null hypothesis is rejected at 1% level of
significance. Hence there is highly significant difference between level of problems
perceived by SBI bank’s debit card holders and ICICI bank’s debit card holders. It
reveals that the problems perceived by SBI debit card holders are high and ICICI
debit card holders are low. Hence the SBI bank should take necessary steps to redress
grievances of its debit cardholders quickly for achieving higher satisfaction of its
customers.
366
HYPOTHESIS- IV
Null Hypothesis: There is no significant difference between banks and level of
Problem with respect to Internet banking
Table 5.3.4 Chi-Square test for significant difference between banks and level of
problems with respect to Internet banking
Bank Level of Internet banking related
problems
Total
Chi-
square
value
P value
Low Moderate High
ICICI
23
(31.5)
37
(50.7)
13
(17.8)
73
1.879
0.039**
SBI
12
(21.1)
32
(51.6)
13
(22.8)
57
TOTAL
35
69
26
130
Note: The value within brackets refers to Row percentage.
Since P value is less than 0.05, the null hypothesis is rejected at 5% level of
significance. Hence there is a significant difference between level of problems
perceived by Internet banking users of SBI bank and ICICI bank. It is concluded that
the SBI internet banking customer’s level of problem is high, whereas ICICI internet
banking customer’s level of problem is low. So, the SBI should collect feedback from
customers and conduct periodic reviews to redress the grievances and should take
steps to redress quickly for higher customer satisfaction.
367
HYPOTHESIS- V
Null Hypothesis: There is no significant difference between banks and level of
Problem with respect to Mobile banking
Table 5.3.5 Chi-Square test for significant difference between banks and level of
problems with respect to Mobile banking
Bank Level of Mobile banking related
problems
Total
Chi-
square
value
P value
Low Moderate High
ICICI
10
(34.5)
9
(31.0)
10
(34.5)
29
15.934
0.047**
SBI
5
(20.0)
16
(64.0)
4
(16.0)
25
TOTAL
15
25
14
54
Note: The value within brackets refers to Row percentage.
Since P value is less than 0.05, the null hypothesis is rejected at 5% level of
significance. Hence there is a significant difference between level of problems
perceived by SBI mobile banking customers and ICICI bank’s mobile banking
customers. It reveals that the problems perceived by ICICI mobile banking customers
are high and the problems of SBI mobile banking customers are low. So, the ICICI
bank should take appropriate steps to redress the grievances of mobile banking
customers quickly for higher satisfaction in this area.
368
HYPOTHESIS- VI
Null Hypothesis: There is no significant difference between banks and level of
Problem with respect to RTGS, NEFT and ECS
Table 5.3.6 Chi-Square test for significant difference between banks and level of
problems with respect to RTGS, NEFT and ECS
Bank Level of RTGS, NEFT and ECS
related problems
Total
Chi-
square
value
P value
Low Moderate High
ICICI
10
(21.3)
24
(51.1)
13
(27.7)
47
0.267
0.035**
SBI
11
(22.9)
22
(45.8)
15
(31.3)
48
TOTAL
21
46
28
95
Note: The value within brackets refers to Row percentage.
Since P value less than 0.05, the null hypothesis is rejected at 5% level of
significance. Hence there is a significant difference between level of problems
perceived by RTGS, NEFT and ECS users of SBI and ICICI banks. It is concluded
that problems perceived by SBI customers are high and ICICI customers are low with
respect to RTGS, NEFT and ECS. So, the SBI bank should take appropriate steps to
redress the grievances of its customers quickly to achieve higher satisfaction.
369
HYPOTHESIS- VII
Null Hypothesis: There is no significant difference between banks and level of
Problems with respect to Any Branch banking
Table 5.3.7 Chi-Square test for significant difference between banks and level of
problems with respect to Any Branch banking
Bank Level of Any Branch banking
related problems
Total
Chi-
square
value
P value
Low Moderate High
ICICI
5
(25.0)
8
(40.0)
7
(35.0)
20
0.398
0.020**
SBI
5
(17.9)
13
(46.4)
10
(31.3)
28
TOTAL
10
21
17
48
Note: The value within brackets refers to Row percentage.
Since P value is less than 0.05, the null hypothesis is rejected at 5% level of
significance. Hence there is a significant difference between level of problems
perceived by any branch banking customers of SBI and ICICI. It is concluded the
ICICI bank customer’s perception on problems is high with respect to any branch
banking whereas it is low in case of SBI bank. So, the ICICI bank should take
necessary steps to understand the problems of its customers and should take
appropriate steps to redress the grievance of its any branch banking customers quickly
for higher satisfaction.
370
HYPOTHESIS- VIII
Null Hypothesis: There is no significant difference between banks and level of
Problems with respect to Fraud
Table 5.3.8 Chi-Square test for significant difference between banks and level of
problems with respect to Fraud
Bank Level of Fraud related problems
Total
Chi-
square
value
P value
Low Moderate High
ICICI
84
(32.1)
111
(42.4)
67
(25.6)
262
3.555
0.016**
SBI
72
32.7)
77
(35.0)
71
(32.3)
220
TOTAL
156
188
138
482
Note: The value within brackets refers to Row percentage.
Since P value is less than 0.05, the null hypothesis is rejected at 5% level of
significance. Hence there is a significant difference between level of problems
perceived by SBI and ICICI customers with respect to fraud. It is concluded that SBI
banks’ e-banking customer’s perception on problems related to fraud is high and the
ICICI bank’s e-banking customer’s perception on problems related fraud is low. So,
the SBI should educate its e-banking customer’s fraud prevention measures and keep
them informed of the new malware so that they can be cautious.
371
HYPOTHESIS-IX
Null Hypothesis: There is no significant association between age group and level
of Problems with respect to ATM
Table 5.3.9 Chi-Square test for association between age group and level of
Problems with respect to ATM
Age
group
(years)
Level of ATM related problems Total Chi-
square
value
P value
Low Moderate High
<30
44
(40.0)
44
(40.0)
22
(20.0)
110
4.394
0.023**
30-40
68
(34.3)
81
(40.9)
49
(24.7)
198
40-50
38
(31.9)
59
(49.6)
22
(18.5)
119
>50
19
(34.5)
23
(41.8)
13
(23.6)
55
Total
169
207
106
482
Note: The value within brackets refers to Row percentage.
Since P value is less than 0.05, the null hypothesis is rejected at 5% level of
significance. Hence there is a significant association between age group and level of
problems with respect to ATM. It reveals that age group below 30 years faced lesser
problems than other age group. It is concluded that the banks should conduct a survey
and identify the problems with respect to ATM, age group wise for better satisfaction.
372
HYPOTHESIS-X
Null Hypothesis: There is no significant association between age group and level
of Problem with respect to credit card
Table 5.3.10 Chi-Square test for association between age group and level of
Problems with respect to credit card
Age
group
(years)
Level of credit card related
problems
Total Chi-
square
value
P value
Low Moderate High
<30
12
(26.7)
24
(53.3)
9
(20.0)
45
4.069
0.067
30-40
33
(35.5)
35
(37.6)
25
(26.9)
93
40-50
11
(26.2)
18
(42.9)
13
(31.0)
119
>50
1
(25.0)
2
(50.0)
1
(25.0)
4
Total
57
79
48
184
Note: The value within brackets refers to Row percentage.
Since P value is greater than 0.05, the null hypothesis is accepted at 5% level
of significance. Hence there is no association between age group and level of
problems perceived with respect to credit card. It is concluded that the level of
problems perceived by credit card holders is moderate. The banks should identify the
problems through customers’ feedback irrespective of age group and should take
appropriate steps to redress the grievances.
373
HYPOTHESIS-XI
Null Hypothesis: There is no significant association between age group and level
of Problem with respect to Debit card
Table 5.3.11 Chi-Square test for association between age group and level of
Problems with respect to Debit card
Age
group
(years)
Level of Debit card related
problems
Total Chi-
square
value
P value
Low Moderate High
<30
39
(35.5)
49
(44.5)
22
(20.0)
110
4.763
0.025**
30-40
55
(27.8)
93
(47.0)
50
(25.3)
198
40-50
40
(33.6)
53
(44.5)
26
(21.8)
119
>50
22
(40.0)
24
(43.6)
9
(16.4)
55
Total
156
219
107
482
Note: The value within brackets refers to Row percentage.
Since P value is less than 0.05, the null hypothesis is rejected at 5% level of
significance. Hence there is an association between age group and level of problems
perceived with respect to debit card. It reveals that debit card holders in the age group
of 30-40 are facing high level of problems and age group below 30 is facing lesser
problems. It is concluded that the banks should conduct a survey for identifying the
problems faced by debit cardholders in each age group separately and should take
appropriate steps to redress the grievances accordingly.
374
HYPOTHESIS-XII
Null Hypothesis: There is no significant association between age group and level
of Problem with respect to Internet banking
Table 5.3.12 Chi-Square test for association between age group and level of
Problems With respect to Internet banking
Age
group
(years)
Level of Internet banking related
problems
Total Chi-
square
value
P value
Low Moderate High
<30
6
(24.0)
17
(68.0)
2
(8.0)
25
4.681
0.585
30-40
10
(23.3)
22
(51.2)
11
(25.6)
43
40-50
14
(31.1)
21
(46.7)
10
(22.2)
45
>50
5
(29.4)
9
(52.9)
3
(17.6)
17
Total
35
69
26
130
Note: The value within brackets refers to Row percentage.
Since P value is greater than 0.05, the null hypothesis is accepted at 5% level
of significance. Hence there is no association between level of problems with
reference to internet banking and age group. It is concluded that the internet banking
customers in all age group are facing moderate level of problems. So the banks
providing internet banking facilities should try to find out the internet banking
customers perception on problems and take appropriate steps to redress the grievances
for higher satisfaction in this area.
375
HYPOTHESIS-XIII
Null Hypothesis: There is no significant association between age group and level of
Problem with respect to Mobile banking
Table 5.3.13 Chi-Square test for association between age group and level of
Problems with respect to Mobile banking
Age
group
(years)
Level of Mobile banking related
problems
Total
Chi-
square
value
P value
Low Moderate High
<30
4
(44.4)
3
(33.3)
2
(22.2)
9
3.616
0.028**
30-40
8
(25.0)
16
(50.0)
8
(25.0)
32
40-50
2
(20.0)
4
(40.0)
4
(40.0)
10
>50
1
(33.3)
2
(66.7)
0
(0.0)
17
Total
15
25
14
54
Note: The value within brackets refers to Row percentage.
Since P value is less than 0.05, the null hypothesis is rejected at 5% level of
significance. Hence there is a significant association between age group and level of
problems with respect to mobile banking. It reveals that the mobile banking customers
in the age of 40-50 years are facing high level problems and the problems of mobile
banking customers in the age group of below 30 years in low. It is concluded that the
banks should find out the mobile banking customer’s problems on the basis of age
group and redress their grievances accordingly without any delay which is necessary
for achieving higher satisfaction.
376
HYPOTHESIS-XIV
Null Hypothesis: There is no significant association between age group and level
of Problem with respect to fraud
Table 5.3.14 Chi-Square test for association between age group and level of
Problems Related to fraud
Age
group
(years)
Level of fraud related problems
Total
Chi-
square
value
P value
Low Moderate High
<30
37
(33.6)
42
(38.2)
31
(28.2)
110
3.733
0.013**
30-40
63
(31.8)
75
(37.9)
60
(30.3)
198
40-50
36
(30.3)
46
(38.7)
37
(31.1)
119
>50
20
(36.4)
25
(45.5)
10
(18.2)
55
Total
156
188
138
482
Note: The value within brackets refers to Row percentage.
Since P value is less than 0.05, the null hypothesis is rejected at 5% level of
significance. Hence there is a significant association between age group and level of
problems related to fraud. The e-banking customers in the age group of above 50
years are facing lesser fraud related problems compared to other age group and the
problems of age group 30-40 is high. Therefore, it is concluded that the banks should
create awareness among e-banking customers about frauds and educate fraud
prevention measures giving due consideration to each age group.
377
HYPOTHESIS-XV
Null Hypothesis: There is no significant association between occupation and
level of Problem with respect to ATM
Table 5.3.15 Chi-Square test for association between occupation and level of
Problems with respect to ATM
Occupation
Level of ATM related
problems
Total
Chi-
square
value
P value
Low Moderate High
Businessman
22
(37.9)
28
(48.3)
8
(13.8)
58
17.363
0.047**
Professional
30
(40.0)
30
(40.0)
15
(20.0)
75
Govt.
Employee
45
(28.7)
64
(40.8)
48
(30.6)
157
Private
employee
47
(36.4)
59
(45.7)
23
(17.8)
129
Retired
person
7
(25.0)
15
(53.6)
6
(21.4)
28
Others
18
(51.4)
11
(31.4)
6
(17.1)
35
Total
169
207
106
482
Note: The value within brackets refers to Row percentage
Since P value is less than 0.05, the null hypothesis is rejected at 5% level of
significance. Hence there is a significant association between occupation and level of
problems with reference to ATM. It reveals that the level of problems of Government
employees in higher than businessmen, professional and other e-banking customers.
So, the banks should analyse the problems from the aspect of e-banking customers in
different occupational status and find solutions accordingly.
378
HYPOTHESIS-XVI
Null Hypothesis: There is no significant association between occupation and
level of Problem with respect to Credit card
Table 5.3.16 Chi-Square test for association between occupation and level of
Problems with respect to credit card
Occupation
Level of credit card related
problems
Total
Chi-
square
value
P value
Low Moderate High
Businessman
12
(52.2)
8
(34.8)
13
(13.0)
23
17.755
0.023**
Professional
8
(22.2)
22
(61.1)
6
(16.7)
36
Govt.
Employee
15
(21.7)
28
(40.6)
26
(37.7)
69
Private
employee
20
(38.5)
20
(38.5)
12
(23.1)
52
Others
2
(50.0)
1
(25.0)
1
(25.0)
4
Total
57
79
48
184
Note: The value within brackets refers to Row percentage
Since P value is less than 0.05, the null hypothesis is rejected at 5% level of
significance. Hence there is a significant association between occupation and level
problems with respect to credit card. It is concluded that the Government employees
having credit cards are facing higher level of problems and the problems of
businessmen is lesser. So, the banks should conduct a survey from the aspect of
customers in different occupational status to find out the problems and take
appropriate steps to redress the grievances quickly for higher satisfaction.
379
HYPOTHESIS-XVII
Null Hypothesis: There is no significant association between occupation and
level of Problem with respect to Debit card
Table 5.3.17 Chi-Square test for association between occupation and level of
Problems with respect to debit card
Occupation
Level of debit card related
problems
Total
Chi-
square
value
P value
Low Moderate High
Businessman
27
(46.6)
20
(34.5)
11
(19.0)
58
41.009
0.000***
Professional
26
(34.7)
39
(52.0)
10
(13.3)
75
Govt.
Employee
30
(19.1)
73
(46.5)
54
(34.4)
157
Private
employee
41
(31.8)
65
(50.4)
23
(17.8)
129
Retired
person
13
(46.4)
12
(42.9)
3
(10.7)
28
Others
19
(54.3)
10
(28.6)
6
(17.1)
35
Total
156
219
107
482
Note: The value within brackets refers to Row percentage
Since P value is less than 0.01, the null hypothesis is rejected at 1% level of
significance. Hence there is a highly significant association between occupational
status and level of problems with respect to debit card.
It is concluded that the government employees’ perception on problems
related to debit card is high in comparison with businessmen, retired person,
380
professional and private employees. So the banks should take necessary steps to
examine the problems from the aspect of occupational status and redress the
grievances quickly for higher satisfaction in this area.
HYPOTHESIS-XVIII
Null Hypothesis: There is no significant association between occupation and
level of Problem with respect to Net banking
Table 5.3.18 Chi-Square test for association between occupation and level of
Problems with respect to Net banking
Occupation
Level of Net banking related
problems
Total
Chi-
square
value
P value
Low Moderate High
Businessman
16
(34.8)
23
(50.0)
7
(15.2)
46
9.892
0.045**
Professional
6
(21.4)
16
(57.1)
6
(21.4)
28
Govt.
Employee
5
(18.5)
12
(44.4)
10
(37.0)
27
Private
employee
6
(26.1)
14
(60.9)
3
(13.0)
23
Retired
person
1
(50.0)
1
(50.0)
0
(0.0)
2
Others
1
(25.0)
3
(75.0)
0
(0.0)
4
Total
35
69
26
130
Note: The value within brackets refers to Row percentage
381
Since P value is less than 0.05, the null hypothesis is rejected at 5% level of
significance. Hence there is a significant association between occupation and level of
problems perceived by internet banking customers. The government employees
availing internet banking facilities are facing more problems than other net banking
users and the private employees are facing lesser problems than other net banking
users. Hence, the banks should examine the problems of net banking customers from
the aspect of occupational status to redress the grievances properly and gain
customer’s satisfaction in this area.
382
HYPOTHESIS-XIX
Null Hypothesis: There is no significant association between occupation and
level of Problem with respect to Mobile banking
Table 5.3.19 Chi-Square test for association between occupation and level of
Problems with respect to Mobile banking
Occupation
Level of Mobile banking
related problems
Total
Chi-
square
value
P value
Low Moderate High
Businessman
0
(0.0)
0
(0.0)
4
(100.0)
4
917.838
0.058
Professional
5
(35.7)
7
(50.0)
2
(14.3)
14
Govt.
Employee
5
(27.8)
7
(38.9)
6
(33.3)
18
Private
employee
5
(33.3)
8
(53.3)
2
(13.3)
15
Retired
person
0
(0.0)
2
(100.0)
0
(0.0)
2
Others
0
(0.0)
1
(100.0)
0
(0.0)
1
Total
15
25
14
54
Note: The value within brackets refers to Row percentage
Since P value is greater than 0.50, the null hypothesis is accepted at 5% level
of significance. Hence there is no significant association between occupational status,
and level of problems with respect to mobile banking. It is concluded that all mobile
383
banking customers are facing moderate level of problems except the businessman
irrespective of their occupational status. So, the banks should examine the problems
of mobile banking customers irrespective of their occupational status and take
necessary steps to redress their grievances quickly to gain customer’s satisfaction in
the competitive environment.
384
HYPOTHESIS-XX
Null Hypothesis: There is no significant association between occupation and
level of Problem with respect to RTGS, NET and ECS.
Table 5.3.20 Chi-Square test for association between occupation and level of
Problems with respect to RTGS, NEFT and ECS
Occupation
Level of RTGS, NEFT and ECS
related problems
Total
Chi-
square
value
P value
Low Moderate High
Businessman
10
(21.7)
22
(47.8)
14
(30.4)
46
10.268
0.417
Professional
5
(21.7)
14
(60.9)
4
(17.4)
23
Govt.
Employee
2
(15.4)
7
(53.8)
4
(30.8)
13
Private
employee
3
(27.3)
3
(27.3)
5
(45.5)
11
Retired
person
1
(100.0)
0
(0.0)
0
(0.0)
1
Others
0
(0.0)
0
(0.0)
1
(100.0)
1
Total
21
46
28
95
Note: The value within brackets refers to Row percentage
Since P value is greater than 0.05, the null hypothesis is accepted at 5% level
of significance. Hence there is no significant association between occupational status
of RTGS, NEFT, ECS users and their level of problems. It reveals that businessmen,
professionals and Government employees are facing moderate level of problems
where as private employers are facing high level of problems.
385
It is concluded that majority of the RTGS, NEFT and ECS users are facing
moderate level of problems. So, the banks should conduct a survey and identify the
problems for the proper redressal of grievances which is necessary for higher
satisfaction in this area.
HYPOTHESIS-XXI
Null Hypothesis: There is no significant association between occupation and
level of Problem with respect to fraud
Table 5.3.21 Chi-Square test for association between occupation and level of
Problems Related to fraud
Occupation
Level of fraud related
problems
Total
Chi-
square
value
P value
Low Moderate High
Businessman
23
(39.7)
15
(25.9)
20
(34.5)
58
19.897
0.030**
Professional
24
(32.0)
30
(40.0)
21
(28.0)
75
Govt.
Employee
39
(24.8)
61
(38.9)
57
(36.3)
157
Private
employee
43
(33.3)
56
(43.4)
30
(23.3)
129
Retired
person
13
(46.4)
13
(46.4)
2
(7.1)
28
Others
14
(40.0)
13
(37.1)
8
(22.9)
35
Total
156
188
138
482
Note: The value within brackets refers to Row percentage
Since P value is less than 0.05, the null hypothesis is rejected at 5% level of
significance. Hence there is a significant association between occupational status of e-
banking customers and their level of problems related to fraud. It reveals that
386
government employees’ perception on problems related to fraud is high in comparison
with other e-banking customers. So the study banks should conduct a survey to
understand which category of customers are facing high level of problems and create
awareness among them and educate them fraud prevention measures to reduce the
level of problems related fraud which will leads to higher customer confidence and
satisfaction in this area of study.
5.4. Summary
In this chapter the e-banking customer’s perceptions of the various problems
are analysed and their views on resolution of problems and incidents are evaluated.
The problems have evaluated with respected to each e-banking product separately
under eight categories such as ATM related problems, credit card related problems,
debit card related problems, Internet banking related problems, Mobile banking
related problems, RTGS, NEFT, ECS related problems, Any branch banking related
problems and problems related fraud.
The analysis was to find out the problems perceived by the respondents in the
study banks shows that if they are interested in contacting the banks for their
problems related to e-banking products, it represents 66 percent interested and 34
percent were not able to contact the banks or make complaint for their problems. The
reasons for the respondents for not making complaint are busy with their work and
failure of previous efforts. Majority of the respondents made complaints through help
line, and duration of time required to solve the problems is in a week and the number
times complaints made by majority of the respondents was less than 3 times. The
overall problem perceived by majority of the respondents is moderate. Further, the
overall satisfaction of respondents’ problems handled or being handled in study banks
is also an average level.
Hypothesis I to VIII – test was conducted to find out if there is any significant
difference between SBI and ICICI bank’s e-banking customers and the level of
problems perceived by them with respect to ATM, Credit card, Debit card, net
banking, mobile banking, RTGS, NEFT, ECS and any branch banking. It reveals that
there is a significant difference between e-banking customers of SBI and ICICI banks
and their level of problems with respect to each e-banking product and problems
related to fraud. It is concluded that the problems perceived by SBI’s e-banking
387
customers with respect to ATM,. Debit card, credit card, internet banking, RTGS,
NEFT, ECS and fraud is high. But the problems perceived by ICICI bank’s e-banking
customers with respect to mobile banking and any branch banking are high.
Hypothesis IX to XIV – test was conducted to find out if there is any significant
association between age group and level of problems perceived by e-banking
customers with respect to ATM, debit card, credit card, internet banking, mobile
banking, and problems related fraud. It reveals that there is a significant association
between age group and level of problems with respect to ATM and age group below
30- years are facing lesser problems than other age group.
There is no association between age group and level of problems perceived by
credit cardholders and the level of problems perceived by all credit cardholders is
moderate. It also reveals that there is an association between age group and level of
problems perceived with respect to debit card and the debit card holders in the age
group of 30-40 are facing high level of problems. There is no significant association
between level of problems with reference to internet banking and age group. It is
concluded that the internet banking customers in all age group are facing moderate
level of problems. The analyses further reveals that there is a significant association
between age group and level of problems with respect to mobile banking and it is
concluded that the mobile banking customers in the age of 40-50 years are facing high
level of problems. Further there is a significant association between age group and
level of problems related to fraud. It is concluded that e-banking customers in the age
group of above 50 years are facing lesser fraud related problems and the problems of
age group 30-40 is high.
Hypothesis XV to XXI – test was conducted to find out if there is any
association between occupational status and level of problems perceived by e-banking
customers with reference to ATM, Debit card, credit card, Internet banking, Mobile
banking, RTGS, NEFT, ECS and fraud. If reveals that there is a significant
association between occupation and level of problems with reference to ATM and the
Government employees level of problems is higher than businessmen and
professionals. There is a significant association between occupation and level of
problems with respect to credit card. It is concluded that Government employees are
facing higher credit card related problem and the problems of businessmen is lesser.
388
It also reveals that there is a highly significant association between
occupational status and levels problems with respect to debit card. It is concluded that
the government employees perception on problems related to debit card is high in
comparison with the problems of businessmen, retired person, professional and
private employees. However, there is no significant association between occupational
status and level of problems with respect to mobile banking. It is concluded that all
mobile banking customers except businessmen are facing moderate level of problems.
The test further reveals that there is a significant association between occupation and
level of problems perceived by internet banking customers. It is concluded that the
Government employees availing internet banking facilities are facing more problem
than other net banking users. There is no significant association between occupational
status of RTGS, NEFT, ECS users and their level of problems.
It is concluded that majority of the RTGS, NEFT and ECS users are facing
moderate level of problems. The test also reveals that there is a significant association
between occupational status of e-banking customers and their level of problems
related to fraud. It is concluded that government employees’ perception on problems
related to fraud is high in comparison with other category of e-banking customers.
389
CHAPTER VI
CUSTOMERS’ SATISFACTION TOWARDS E-BANKING PRODCUTS AND
SERVICES
6.1. INTRODUCTION
Customer’s satisfaction is a major force in banking business. Ever since, the
liberalization and globalization of Indian economy the focus point in any service
organization is “customer service” and “customer satisfaction” more so in the banking
industry. Customer service and satisfaction is the base for business expansion because
of the stiff competition prevalent in the banking industry. With the advent of new
private banks in 1995, the concept of customer service has become an important and
pivotal issue in banks, either it is in the public sector, private sector, co-operative
sector or NBFC. The service of banking business is dependent on customer service
and customer satisfaction.
Satisfaction is a function of perceived performance and expectations. If the
performance falls short of expectation, the customer is dissatisfied. If the performance
matches the expectations, the customer is satisfied. If the performance exceeds
expectations, the customer is highly satisfied or delighted. Many banks are aiming for
high satisfaction because customers who are just satisfied still find it easy to switch
when a better offer comes along. Those who are highly satisfied are much less ready
to switch. High satisfaction or delight creates an emotional bond and the result is high
customer loyalty.
A customer is the core component in the banking business. The business of
banking cannot function without customers, nor is the business done by acquiring a
certain number of customers. It is a continuing process of transactions culminating in
a long term banker-customer relationship. Most banking institutions thrive more on
keeping old customers happy rather than getting new customers. It has been found
that keeping existing customers happy and satisfied in turn brings in new customers
and becomes easier to market the banking products. Since almost all banks offering
more or less the same products with little changes, the concept of enhancing the
customer’s satisfaction has become a pivotal point to attract more and more people to
banking by a particular bank.
390
Today, customers are not ready to accept delay in service and are in need of
information for instant decision. Continuous improvement, gaining competitive edge,
increased market shares, higher profit; none of these things is possible unless business
can find a new way of enhancing the customer satisfaction. A highly satisfied
customer stays loyal longer, buy more as the bank introduces to new products and
services, talks favorably about the bank and its services, pay less attention to
competitive products and advertising, offers product and service ideas to the bank.
Today, the relationship between the banker and customer has become under
the sharp focus both at the banker’s and as well as at the customer’s ends. Many
customers are not only expecting but are demanding better service. For delivery of
quality service, it is imperative to have customer orientation as a culture in the bank.
Customer orientation builds long term relationships resulting in customer satisfaction
and cash flow to banks. Thus once good service is extended to a customer; a loyal
customer will work as an Ambassador to the bank and facilitate growth of business.
This chapter is devoted to measure the satisfaction level of customers of SBI
and ICICI banks towards e-banking in Thanjavur town. To assess the satisfaction
level of customers, the factors like age, gender, occupation, monthly income and
marital status were used. To test the significance between the above variable and
satisfaction level various test were used. This chapter also analyses, if there is any
association between satisfaction level and level of problems of e-banking customers.
The satisfaction of the e-banking customers was assessed on the basis of parameters
such as e-banking facilities and quality of service. The e-banking customers of the
respective banks customers were asked to rate their bank’s e-banking services on the
basis of e-banking products such as ATM – cum – Debit Card, ATM services, credit
card, internet banking, mobile banking, RTGS, NEFT, Electronic Clearing Service
(ECS) and any branch banking and on the basis of quality of service such as
accuracy/absence of error, confidentiality, good, complaint handling, clear
communication, No breakdown of machines/services, prompt to response customer
request, easy connectivity, adoption of user friendly technology, connectivity with
other banks, secured transaction.
391
Based on these parameters, overall satisfaction level of e-banking customers
was found. The satisfaction of customer’s towards e-banking services was assessed
based on five point scale given in the questionnaire and the points allotted to them
are:
Excellent – 5 Very good – 4 Just satisfactory – 3
Poor – 2 Very poor – 1
392
6.2 DESCRIPTIVE ANALYSIS OF SAMPLES
Table 6.2.1
Overall level of satisfaction of E-Banking customers
Level of satisfaction
Frequency
Percentage
Low
101
21
Moderate
234
48.5
High
147
30.5
Total
482
100.0
Source: Primary data
The above table shows the overall satisfaction level of e-banking customers in
the study banks. It reveals that 21 percent of low satisfaction, 48.5 percent of
moderate and 30.5 percent of higher satisfaction. It is concluded that the satisfaction
of e-banking customers is moderate. The respondents are not fully satisfied with the e-
banking services provider by SBI and ICICI banks. So, the banks should take
necessary steps and adopt appropriate strategy to improve their quality of services for
their customers’ higher level of satisfaction.
FIG.6.2.1 OVERALL SATISFACTION OF
E-BANKING CUSTOMERS
21
30.5
48.5
0
10
20
30
40
50
60
Low
Mod
erate
Hig
h
Percentage
393
Table 6.2.2
Level of satisfaction of ATM-cum-Debit card users
Bank
Level of satisfaction
Total
Low Moderate High
ICICI
50
(19.1)
119
(45.4)
93
(35.5)
262
SBI
51
(23.2)
115
(52.3)
54
(24.5)
220
Total
101
234
147
482
Source: Primary data
The above table shows the satisfaction level of SBI and ICICI bank’s ATM –
cum-Debit card users. It reveals that 19.1 percent of ICICI customers have low level
of satisfaction, 45.9 percent moderate level and 35.5 percent have high level of
satisfaction. It also reveals that 23.2 percent of SBI customers have low level of
satisfaction. 52.3 percent moderate and 24.5 percent have high level of satisfaction. It
is concluded that both banks ATM – cum – Debit card users have moderate level of
satisfaction but comparatively the satisfaction level of ICICI bank’s ATM – Cum –
debit card users are higher than SBI. So the Banks should take immediate steps to
provide more quality of ATM – cum – Debit card services for higher level of
satisfaction.
394
Table 6.2.3
Level of satisfaction of credit card users
Bank
Level of satisfaction
Total
Low Moderate High
ICICI
27
(26.2)
37
(35.9)
39
(37.9)
103
SBI
31
(38.3)
35
(43.2)
15
(18.5)
81
Total
58
72
54
184
Source: Primary data
The above table shows the satisfaction level of SBI and ICICI bank’s credit
cardholders. It reveals that among 103 credit cardholders of ICICI bank 26.2 percent
have low level of satisfaction, 35.9 percent have moderate and 37.9 percent high level
of satisfaction. Among 81 credit card holders of SBI bank 38.3 percent have low level
of satisfaction, 43.2 percent moderate and 18.5 percent have high level of satisfaction.
It is concluded that satisfaction level of ICICI bank’s credit cardholders are higher
than SBI. So, the SBI bank should adopt appropriate strategy to improve the quality of
credit card service for achieving the higher level satisfaction of their cardholders in
this area of study.
395
Table 6.2.4
Level of satisfaction of Internet banking users
Bank
Level of satisfaction
Total
Low Moderate High
ICICI
15
(20.5)
29
(39.7)
29
(29.7)
73
SBI
15
(26.3)
29
(50.9)
13
(22.8)
57
Total
30
58
42
130
Source: Primary data
The above table shows the satisfaction level of internet banking users of ICICI
and SBI banks. It reveals that 20.5 percent of ICICI net banking users have low level
of satisfaction and 39.7 percent moderate and 29.7 percent have higher level of
satisfaction. In case of SBI 26.3 percent have low level satisfaction, 50.9 percent
moderate and 22.8 percent have higher level of satisfaction. It is concluded that the
satisfaction level of net banking users of these two banks have moderate level of
satisfaction but comparatively the satisfaction level of ICICI bank’s customers are
higher than SBI. So, the banks particularly SBI should assess their customers’ needs
and expectation for improving the facilities provided under net banking and should
also adopt appropriate strategy to improve the quality of their net banking services for
higher customer’s satisfaction.
396
Table 6.2.5
Level of satisfaction of Mobile banking users
Bank
Level of satisfaction
Total
Low Moderate High
ICICI
8
(27.6)
11
(37.9)
10
(34.5)
29
SBI
8
(32.0)
10
(40.0)
7
(28.0)
25
Total
16
21
17
54
Source: Primary data
The above table shows the satisfaction level of mobile banking users of SBI
and ICICI banks. Among 29 mobile banking users of ICICI bank 27.6 percent have
low level of satisfaction, 37.9 have moderate level and 34.5 percent have high level of
satisfaction. In case of SBI it represents 32 percent of low satisfaction, 40 percent of
moderate and 28 percent of higher satisfaction. It is concluded that both SBI and
ICICI bank’s mobile banking user’s satisfaction level is moderate. But comparatively
the satisfaction levels of ICICI bank’s mobile banking users are higher than SBI. So,
the banks should assess the needs and expectations of their mobile banking users and
try to improve their quality of mobile banking services for higher satisfaction.
397
Table 6.2.6
Level of satisfaction of NEFT users
Bank
Level of satisfaction
Total
Low Moderate High
ICICI
8
(27.6)
11
(44.0)
6
(24.0)
25
SBI
3
(14.3)
10
(47.6)
8
(38.1)
21
Total
11
21
14
46
Source: Primary data
The above table shows the satisfaction level of SBI and ICICI bank’s NEFT
users. Among 25, ICICI NEFT users 27.6 percent represent low level of satisfaction,
44 percent moderate and 24 percent higher satisfaction. In case of SBI it represents
14.3 percent low satisfaction, 47.6 percent moderate and 38.1 percent higher
satisfaction. It is concluded that both bank’s NEFT user’s satisfaction is moderate.
But comparatively the satisfaction level of SBI NEFT users is higher than ICICI.
However both banks should adopt correct strategy to improve their quality of NEFT
services through proper assessment of the needs and expectations of their customers.
398
Table 6.2.7
Level of satisfaction of RTGS users
Bank
Level of satisfaction
Total
Low Moderate High
ICICI
4
(18.2)
10
(45.5)
8
(36.4)
22
SBI
2
(11.1)
12
(66.7)
4
(22.2)
18
Total
6
22
12
40
Source: Primary data
The above table shows the satisfaction level of RTGS users of ICICI and SBI
banks. It reveals that among 22 ICICI bank’s RTGS users, 18.2 percent have low
satisfaction, 45.5 percent have moderate and 36.4 percent have high satisfaction. In
case of SBI, 11.1 percent have low satisfaction, 66.7 percent have moderate, and 22.2
percent have higher satisfaction with respect to RTGS facility. It is concluded that
both bank’s RTGS users have moderate satisfaction. But comparatively the
satisfaction levels of ICICI bank customers are higher than SBI. So, the banks
particularly SBI should improve its quality of RTGS service for achieving higher
satisfaction in this area of study.
399
Table 6.2.8
Level of satisfaction of ECS users
Bank
Level of satisfaction
Total
Low
Moderate
High
ICICI
5
(38.5)
4
(30.8)
4
(30.8)
13
SBI
2
(10.5)
10
(52.6)
7
(36.8)
19
Total
7
14
11
32
Source: Primary data
The above table shows the satisfaction level of ECS users of ICICI and SBI
banks. It reveals that incase of ICICI bank’s ECS users 38.5 percent represents low
satisfaction, 30.8 percent moderate, 30.8 percent represent higher satisfaction. In case
of SBI, 10.5 percent represent low satisfaction, 52.6 percent moderate, 36.8 percent
higher satisfaction. It is concluded that the satisfaction level of ICICI bank’s ECS
users is low and comparatively SBI bank’s ECs users’ satisfaction is higher. So, the
ICICI bank should find out the reason for low satisfaction of its ECS users and should
improve the quality of service for achieving higher satisfaction.
400
Table 6.2.9
Level of satisfaction of Any Branch banking users
Bank
Level of satisfaction
Total
Low
Moderate
High
ICICI
4
(20.0)
9
(45.0)
7
(35.0)
20
SBI
7
(25.0)
15
(53.6)
6
(21.4)
28
Total
11
24
13
48
Source: Primary data
The above table shows the satisfaction level of any branches banking users. It
reveals that 20 percent of ICICI bank customers have low satisfaction, 45 percent
moderate and 35 percent have high satisfaction. In case of SBI 23 percent have low
satisfaction, 53.6 percent moderate and 21.4 percent have high satisfaction.
It is concluded that the satisfaction level of ICICI bank customers with respect
to any branch banking is higher than that of SBI customers. So, SBI should take
immediate steps to provide more quality in any branch banking services for achieving
higher level of satisfaction.
401
6.3 INFERENTIAL ANALYSIS ON SAMPLES
HYPOTHESIS- I
Null Hypothesis: There is no significant difference between banks and level of
satisfaction with respect to E-banking products and services
Table 6.3.1 Chi-Square test for significant difference between banks and level of
satisfaction with respect to E-banking products and services
Bank
Level of satisfaction
Total
Chi-
square
value
P value
Low
Moderate
High
6.817
0.033**
ICICI
50
(19.1)
119
(45.4)
93
(35.5)
262
SBI
51
(23.2)
115
(52.3)
54
(24.5)
220
Total
101
234
147
482
Note: The value within brackets refers to Row percentage
Since the P value is less than 0.05, the null hypothesis is rejected at 5% level
of significance. Hence there is a significant difference between level of satisfaction of
e-banking customers of SBI and ICICI banks. It is concluded that the satisfaction
level of ICICI bank’s customers with respect to e-banking products and services are
higher than SBI bank’s customers. So the SBI bank should collect periodic reviews
from customers to understand their needs and expectations better and should adopt
appropriate strategy to promote the e-banking services and improve the quality of
service which is essential for gaining higher customer satisfaction in this area of
study.
402
HYPOTHESIS- II
Null Hypothesis: There is no significant difference between male and female
E-banking customers with respect to satisfaction level
Table 6.3.2 t-test for significant difference between male and female e-banking
customers with respect to satisfaction level
Level of
satisfaction
Levene’s
Test for
Equality of
variances
t-test for Equality of Mean
F
Sig
t
Sig
(2-
tailed)
Mean
Difference
Std.Error
Differenc
e
95%
Confidence
Interval of the
Difference
Equal
variances
assumed
0.230
0.652
1.055
0.029
0.084
0.079
-0.072
0.240
Equal
variances
not
assumed
1.042
0.031
0.084
0.080
-0.075
0.242
*** Correlation is significant at the 0.05 level (2-tailed)
The above table reveals that, levene’s test has a probability greater than 0.5
(F=0.230, P>0.05), it can be assumed that variances are relatively equal. Therefore we
use the t-value and two-tail significance for the equal variance estimate to determine
whether there is any difference exists between male and female customers with
respect to satisfaction level. The two tail significance indicates that P<0.05 and
therefore is significant. The null hypothesis is rejected. Hence there is a significant
difference between level of satisfaction of male and female e-banking customers.
403
HYPOTHESIS- III
Null Hypothesis: There is no significant difference between married and
unmarried e-banking customers with respect to satisfaction
level
Table 6.3.3 t-test for significant difference between married and unmarried E-
banking Customers with respect to satisfaction level.
Lev
el o
f sa
tisf
act
ion
Levene’s Test
for Equality
of variances
t-test for Equality of Mean
F
Sig
t
Sig
(2-
tailed)
Mean
Difference
Std.Error
Difference
95%
Confidence
Interval of
the
Difference
Equal
variances
assumed
1.030
0.311
0.217
0.012
0.018
0.084
-0.147
0.184
Equal
variances
not
assumed
0.223
0.024
0.018
0.082
-0.144
0.180
*** Correlation is significant at the 0.05 level (2-tailed)
The above table reveals that levene’s test has a greater probability (F=1.030,
P>0.05) it can be assumed that variances are relatively equal. Therefore we use the t-
value and two-tail significance for the equal variance estimates to determine whether
there is any difference in the satisfaction level of married and unmarried e-banking
customers. The two tail significance indicates that P<0.05 and therefore is
significance. The null hypothesis is rejected. Hence there is a significant difference
between the level of satisfaction of married and unmarried e-banking customers.
404
HYPOTHESIS- IV
Null Hypothesis: There is no significant difference between age group with
respect to Satisfaction level
Table 6.3.4 ANOVA for significant difference between age group with respect
to Satisfaction level
Fact
or
Age
gro
up
N
Mea
n
S .D
So
urc
e
Su
m o
f
Sq
uare
s
df
Mea
n
Sq
uare
F
Sig
Sati
sfact
ion
lev
el
Below
30 years
110 2.15 0.693
Between
groups 2.954 3 0.985
1.956
0.012**
30 to 40
years 198 2.04 0.732
40 to 50
years
119 2.05 0.699
Within
groups 240.656 478 0.503
Above
50 years 55 2.27 0.679
Total 482 2.10 0.712
Total 243.610 481
** Correlation is significant at the 0.05 level (2-tailed
Since P value is less than 0.05, the null hypothesis is rejected at 5% level of
significance. Hence there is a significant difference between age group with respect to
satisfaction towards e-banking products and services and the satisfaction level of age
group of above 50 years is high. The satisfaction level of age group 30-40 years is
low.
405
HYPOTHESIS- V
Null Hypothesis: There is no significant difference in satisfaction level of e-
banking customers with Different educational qualification
Table 6.3.5 ANOVA for significant difference in satisfaction level of e-banking
customers with Different educational qualification
Fact
or
Educational
qualification
N
Mean
SD Source Sum of
Squares df Mean
Square
F
Sig
Sa
tisf
act
ion
lev
el
Graduate 132 2.01 0.693
Between
groups
3.076 4 0.769
1.525
0.000***
Post Graduate 193 2.11 0.717
Professional
91 2.20 0.749
Within
groups
240.534 477 0.504
Doctorate
21 1.90 0.768
Others 45 2.18 0.614
Total
482 2.10 0.712
Total 243.610 481
Since P value is less than 0.01 the null hypothesis is rejected at 1% level of
significance. Hence there is a significant difference in the satisfaction level of e-
banking customers having different educational qualification and the satisfaction level
of professional is high and the satisfaction level of customers with doctorate
qualification is low.
406
HYPOTHESIS- VI
Null Hypothesis: There is no significant association between occupation and
satisfaction level of e- Banking customers
Table 6.3.6 ANOVA for significant association between occupation and
satisfaction level of E- Banking customers
Fact
or
Occupation
N
Mean
SD Source Sum of
Squares df
Mean
Squar
e
F
Sig
Sati
sfact
ion
lev
el
Businessman
58 2.07 0.722
Between
groups 7.151 5 1.430
2.879
0.014**
Professional
75 2.21 0.741
Govt.
Employee
157 1.94 0.686
Within
groups 236.459 476 0.497
Private
Employee
129 2.16 0.723
Retired
Person
28 2.29 0.659
Others
35 2.23 0.646
Total
482 2.10 0.712
Total 243.610 481
Since P value is less than 0.05, the null hypothesis is rejected at 5% level of
significance. Hence there is a significant association between occupation and
satisfaction level of e-banking customers and the satisfactions level of government
employee are low.
407
HYPOTHESIS- VII
Null Hypothesis: There is no significant association between monthly income
and satisfaction level of e-Banking customers
Table 6.3.7 ANOVA for significant association between monthly income and
satisfaction level of e-banking customers
* * *Correlation is significant at the 0.01 level (2-tailed)
Since P value is less than 0.01, the null hypothesis is rejected at 1% level of
significance. Hence there is a highly significant association between monthly income
and satisfaction level of e-banking customers. The satisfaction level of income group
whose earning is below Rs. 15,000 is high and the satisfaction level income group
Rs.25,000-40,000 is low.
Fa
cto
r
Monthly
income
N
Mean
SD Source Sum of
Squares df Mean
Square
F
Sig
Sa
tisf
act
ion
lev
el
Below
Rs.15000
131 2.24 .646
Between
groups
8.354 4 2.089
4.235
0.002***
Rs.15000
to
Rs.25000
155 2.10 .700
Rs.25000
to
Rs.40000
110 1.89 .758
Within
groups 235.256 477 0.493
Rs.40000
to
Rs.60000
54 2.06 .763
Above
Rs.60000
32 2.25 .622
Total
482 2.10 .712
Total 243.610 481
408
HYPOTHESIS- VIII
Null Hypothesis: There is no significant association between overall problems
and satisfaction level of e-banking customers
Table 6.3.8 Chi-Square test for significant association between overall problems
and satisfaction level of e-banking customers
Overall
problem
level
Level of satisfaction Total Chi-
square
value
P value
Low Moderate High
Low
1
(0.7)
72
(49.3)
73
(50.0)
146
86.725
0.000***
Moderate
42
(41.6)
97
(41.5)
54
(36.7)
193
High
58
(40.6)
65
(45.5)
20
(14.0)
143
Total
101
234
147
482
Note: The value within brackets refers to Row percentage
Since P value is less than 0.01, the null hypothesis is rejected at 1% level of
significance. Hence, there is a highly significant association between overall problems
and satisfaction of e-banking customers. It reveals that the problem of e-banking
customers is moderate and the satisfaction is also moderate. So the study banks should
take necessary steps to redress the problems of e-banking customers quickly for
higher satisfaction in the area.
409
6.4 SUMMARY
In this chapter the results of the study on the basis of the analysis and tests
made could be summarized as follows.
The satisfaction of e-banking customers towards e-banking services provided
by SBI and ICICI banks were assessed on the basis of parameters such as e-banking
facilities and quality of service, which includes accuracy, confidentiality, good
complaint handling, clear communication, No breakdown of machines/services,
prompt response to customers’ request, easy connectivity, adoption of user friendly
technology, connectivity with other banks and secured transaction. Based on these
parameters overall satisfaction level of e-banking customers was found. In identifying
the satisfaction level, five point scale has been used. The five point scale is
categorized into Excellent, very good, just satisfactory, poor and very poor.
The analysis of satisfaction of e-banking customers reveals that their overall
satisfaction towards e-banking products and services is moderate. The respondents are
not fully satisfied with the e-banking services provided by SBI and ICICI bank. So,
the banks should try to understand the needs and expectations of their customers and
improve their quality of service to gain higher satisfaction in the area of study.
The analysis shows that the satisfaction level of ATM – cum – Debit card
users of both banks is moderate. But comparatively the satisfaction level of ICICI
bank’s ATM – cum – Debit card users are higher than SBI, similarly the satisfaction
level of ICICI bank’s credit card holders are higher than SBI card holders. In the same
way the satisfaction level of Internet banking and mobile banking users in ICICI bank
is higher than net and mobile banking users in SBI. However in case of NEFT, SBI
customers’ satisfaction is higher than ICICI. SBI bank’s ECs user’s satisfaction
410
towards e-banking is higher than ICICI bank’s ECS users. The RTGS users and any
branch banking users of ICICI bank have higher satisfaction than the customers of
SBI.
Hypothesis I - test was conducted to find out is any significant difference
between level of satisfaction of e-banking customers in SBI and ICICI banks. It was
found that there is a significant difference between level of satisfaction of e-banking
customers in SBI and ICICI banks. The satisfaction levels of ICICI bank’s customers
are higher than SBI bank’s customers.
Hypothesis II, test was conducted to see in there is any significant difference
exist between male and female customers with respect to satisfaction level. It was
found that there is significant difference between male and female respondents and
their satisfaction level.
Hypothesis III, test is to see if there is any difference significant between
married and unmarried respondents and their satisfaction level. It is found that there is
a significant difference in the satisfaction level of married and unmarried respondents.
Hypothesis IV, test was conduct to find out whether there is any significant
difference between age group and level of satisfaction. It was found that there is a
significant difference in the satisfaction level of respondents in different age group
and the satisfaction level of age group of above 50 years is high. The satisfaction level
of age group 30-40 years is low.
Hypothesis V, test was conducted to find out if there is any significant
difference in the satisfaction level of e-banking customers with different educational
qualification. It was found that there is a significant difference in the satisfaction level
411
of e-banking customers with different educational qualification and the satisfaction
level of professional is high and the satisfaction level of customers with doctorate
qualification is low.
Hypothesis VI – test is to see if there is any association between occupation
and satisfaction level. It reveals that there is a significant association between
occupation and level of satisfaction and the satisfactions level of government
employee is low.
Hypothesis VII – test is to see if there is any significant association between
monthly income and satisfaction level. It reveals that there is a significant association
between monthly income and satisfaction level and the satisfaction level of income
group whose earning is below Rs. 15,000 is high and the satisfaction level income
group Rs.25,000-40,000 is low.
Hypothesis VIII, test is to see if there is any association between overall
problem and overall satisfaction. It reveals that there is a highly significant
association between overall problems and overall satisfaction. It is concluded that the
problems of e-banking customers is moderate and the satisfaction is also moderate. So
the study banks should take necessary steps to redress the problems of e-banking
customers quickly for achieving higher satisfaction.
412
CHAPTER VII
SUMMARY OF FINDINGS, SUGGESTIONS AND CONCLUSION
In the proceeding chapters results were given. The study has utilized
various methods of descriptive and inferential analysis such as chi-square test,
t-test, one-way ANOVA followed by multiple response analysis for conducting
the statistical analysis. In this chapter, a summary of the main findings of the
study are presented. A few suggestions to banks providing electronic banking
products and services and future scope for the research have also been made.
The discussion of this study is presented in seven chapters.
The first chapter outlines the frame work of the study, reviews of
literature on various research work done in the related area both in India and
abroad with focus on the statement of problem, scope of the study, objectives
of the study, hypothesis framed, methodology adopted, sample taken up for the
study, limitations of the study, and chapterization scheme.
The second chapter deals with the theoretical framework of important E-
banking products namely ATM, Debit card, Credit card, Internet banking,
Mobile banking, Electronic fund transfer system, Electronic clearing service,
Real Time Gross Settlement, any branch banking and various services offered
by these products to the customers. An attempt is made in this chapter to
provide in a nutshell the historical development in the concept of each e-
banking product, its growth and development in India, and RBI initiatives in
413
the development of e-banking products. This chapter also discusses fraud an
important threat of e-banking and steps taken by RBI to avoid frauds.
Electronic banking is one of the emerging trends in the Indian banking.
The banking sector in India has introduced E-banking in a phased manner. E-
banking impinges on operations of banking in a number of ways. It has enabled
the banks to handle the payment electronically and interbank settlement faster
and in large volumes. The major channels for distribution in the banking
industry, besides branches are ATMs, Internet banking, mobile banking, card
base delivery system. Availability of ATMs and plastic cards, EFT, electronic
clearing services, internet banking and mobile banking to a large extent avoid
customers going to branch premises and has provided wide range of services.
ATM is the widely accepted delivery channel. ATM technology is used as a
means to reach out to the customers at a lower initial and transaction costs and
offering hassle free services. Since its inception innovations in ATM
technology have come a long way and customer receptiveness has also
increased manifold. Banks across the country have started the process of setting
up ATMs enabled with biometric technology to tap the potential of rural
markets. Multi-lingualATMs has also entered and this technological innovation
is also aimed the rural banking business believed to have large untapped
potential.
Among the card based mechanisms for various banking services. Credit
card and debit card have been immensely successful in India. Since their
launch, penetration of these card based systems have increased manifold over
414
the past few years. Aided by expanding ATM networks and point of sale
terminals, banks have also able to increase the transition of customers towards
these channels, thereby reducing their costs too.
Internet banking is gaining popularity and transactions through net
banking have been steadily increasing. Internet penetration is the main driving
force. Mobile banking is increasingly being seen as a tool for differentiation in
customer servicing by banks. To provide customers a mobile wallet is being
seen as one of the top priorities for banking institutions in the near future. With
the advent of smart phones and ever growing usage of internet on mobile
handsets, application based banking has emerged as a new concept within this
space.
The innovation in technology and communication infrastructure in
recent years have improved banks in a large way through the development of
payment settlement systems, which are central to the major portion of the
business of banking. The continued increase in the volume of cheques added
pressures on the existing setup thus necessitated a cost effective alternative
system such as NEFT, RTGS and ECS. In India cash continues to be the pre-
dominant mode of payment. The policy initiatives and regulatory stance of RBI
has continued to focus on increasing the acceptance and penetration of safe,
secure and efficient non-cash payment modes comprising credit/debit cards and
transactions through ECS/RTGS/NEFT. The day is not far off when the banks
would be viewed more as technology companies offering banking products and
services. While bank branches would continue to function, they would reorient
415
themselves as relationship centers rather than routine banking service
providers.
With the advent of technology, there is a need to further strengthen
customer service in areas of net and mobile banking to enhance customer’s
confidence in these technologies. With great infusion of technology in banking,
the incidents of fraud in electronic banking have witnessed an increase in
recent times. There is a need for building robust mechanism to prevent
incidents of fraud in areas of mobile/net banking and electronic fund transfer.
The third chapter analyses the socio-economic and other variables of the
e-banking customers of SBI and ICICI banks in Thanjavur town. For the
purpose of this analysis, the following socio-economic variables such as sex,
age, education qualification, occupation, monthly income and marital status of
the e-banking customers were considered. This chapter also analyses e-banking
customer’s preference for e-banking product, reason for it. Motivational factors
influencing to use e-banking product, various e-banking produces used by
them, number of years of utilization by the respondents were used for analysis
and found results.
An application of various tests was conducted to find out if there is an
association between age, occupation and the number of years of availing e-
banking services. It reveals that there is an association between age group
number of years of availing e-banking services and the respondents in the age
group of above 40 years were availing e-banking services for more periods than
416
other age group. Further the test reveals that there is no association between
occupation and number of years of availing e-banking services.
Another test exists for an association between age, occupation , monthly
income and frequency of using e-banking products which shows businessman
are using e-banking products more frequently than others and majority of the
higher income group of respondents are using e-banking more frequently than
lower income group.
The fourth chapter analyses the data pertaining to awareness and utility
of e-banking services. The e-banking products that offer multiple services are
only taken for analyses such as ATM cum debit card, credit card, internet
banking, mobile banking and any branch banking. The services of each product
have been classified. Based on the classification customers’ awareness and
utilization were evaluated by using yes/no pattern, giving one point for yes
response and zero for no response. Multiple response analysis has been used to
analyse the customer’s awareness and utilization of e-banking services.
A test was conducted to find out whether there is any association
between age, gender, educational qualification and awareness with respect to
dimensions of e-banking, produces. It reveals that there is an association
between SBI bank’s ATM-cum-Debit card user’s awareness with respect to
convenience services, services at POS and age group. The awareness of age
groups below 30 years and 30-40 years are higher than other age group. The
awareness of age group of above 50 years is very low. There is a significant
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association between age group and awareness of ICICI bank’s net banking
customers towards value added services. The age groups of 30-40 years and
above 40- 50 years are highly aware of value added services. There is a
significant association between age group and awareness of ICICI bank’s credit
card holders with respect to benefit services. The awareness of younger age
group is lesser than other age group.
The test reveals that there is an association between gender and
awareness of ICICI bank’s debit card holders with respect to other services of
debit card. The awareness of male cardholder is higher than female. There is a
significant association between gender and awareness of ICICI bank’s net
banking customers with respect to convenience services and value added
services of net banking. The awareness of male is higher than female with
respect to convenience and value added services net banking. The test also
reveals that there is an association between gender and awareness of SBI
bank’s credit cardholders with respect to insurance services of credit card and
the awareness of male is higher than female.
The next test shows that there is an association between educational
qualification and awareness of ICICI bank’s debit card holders with respect to
value added services at ATM. It reveals that the awareness of graduates is
higher. The test also reveals that there is an association between educational
qualification and awareness of SBI’s bank’s Internet banking customers with
respect to convenience services. It shows that the awareness of graduates is
higher than others. Another test shows there is an association between
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educational qualification and awareness of ICICI bank’s credit card holders
with respect to insurance services. In SBI, the awareness of credit card holder
with professional qualification is higher than others with respect to
convenience and benefit services of credit card.
A test was conducted to find out if there is any association between
occupation, monthly income and utility of various dimensions of e-banking
services offered by SBI and ICICI banks. It reveals that there is an association
between occupation and utility of ICICI bank’s debit card holders with respect
to services at POS and other services of debit card. It is concluded that these
services are highly utilized by businessman there is an association between
occupation and utilization of SBI bank’s debit card holders with respect to
various dimensions of debit card services. It reveals that convenience services
at ATM are highly used by government employees whereas value added
services at POS and other services of debit card is highly used by businessman.
The test of association between occupation and utilization of ICICI
bank’s net banking users reveals that the various dimensions of net banking
services are highly used by businessman. In SBI bank also the various
dimensions of net banking services are highly used businessman. The test to
find association between occupation and utilization of ICICI bank’s credit card
holders reveals that there is an association between occupation and utilization
with respect to convenience services. It was found that convenience services of
credit card are highly used by businessmen. As for as credit card services of
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SBI reveals that convenience services are highly used by private employees
and benefit services are highly used by professionals.
The next test was conducted to find if there is any association between
monthly income and utilization of various dimensions of e-banking services
provided by SBI and ICICI banks. There is an association between monthly
income and utilization of SBI, ICICI bank’s debit card holders with respect to
various dimensions of debit card services. In ICICI bank services at POS is
highly utilized by customers whose monthly income is above Rs,25,000 and
other debit card services are highly used by customers in the income group of
Rs.40000 – 60000. In SBI convenience services at ATM is highly used by
income group of Rs.25000 – 40000 and the value added services by the income
group whose earning is above Rs. 60000. The services listed in the category of
other services are highly by customers whose monthly income is above
Rs.60000.
The test further reveals that convenience services of net banking
provided by ICICI is highly utilized by customers whose income is above
Rs.60000. In SBI bank, both convenience and value added services of net
banking are highly used by customers whose income is higher than Rs.60000.
The test to find association between monthly income and utilization of various
dimensions of credit card services offered by SBI and ICICI banks reveals that
there is an association between monthly income and utilization of ICICI bank’s
credit card holders with respect to convenience services and insurance services
and these services are highly used by cardholders whose income is above
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Rs.60,000. In SBI the convenience and insurance services are highly used by
cardholders whose income is above Rs.60000.
The fifth chapter analyses the e-banking customer’s perceptions of the
various problems and their views on resolution of problems and incidents are
evaluated. The perception of e-banking customers upon the problems
experienced by them has been evaluated based on the responses got on the
following five point scale: strongly agree, agree, neither agree not disagree,
disagree and strongly disagree. Hundred problems stated in the questionnaire
have been divided into the following eight categories and analysed separately.
(1) ATM related problems. (2) Debit card related problems (3) Credit card
related problems (4) Internet banking related problems (5) Mobile banking
related problems (6) RTGS, NEFT and ECS related problems (7) Any branch
banking related problems and (8) frauds related problems.
This chapter discuss the respondents interest in complaining about the
problems to banks, reason for not making complaint, methods of complaining,
number of times complaint made to the banks, if the problems have been
solved or not, if solved duration of time required to solve the problems. It
shows that the majority of the e-banking customers faced moderate problems.
Further it reveals that 66 percent were interested and 34 percent were not able
to contact the banks or make complaint for their problems. Customers were not
able to make complaint due to the following reasons: their busy schedule of
work and failure of previous efforts. It has been found that majority of the
respondents made complaints through helpline and the duration of time
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required by banks to solve the problems is a week. It was found that around
72.3 percent of e-banking customer’s problems were solved by the banks. The
satisfaction of e-banking customers regarding problems handling or being
handled in various banks is average.
A test was conducted to find out if there is any significant difference
between SBI and ICICI e-banking customers and their level of problems with
respect to ATM, credit card, Debit card, net banking, mobile banking, RTGS,
NEFT, ECS and any branch banking. It reveals that there is a significant
difference between e-banking customers of SBI and ICICI banks and their level
of problems with respect to each e-banking products and problems related to
fraud.
Accordingly it was found that the problems perceived by ICICI bank’s
e-banking customers with respect to mobile banking and any branch banking is
high whereas the problems perceived by SBI bank’s e-banking customers with
respect to ATM, debit card, credit card, net banking, RTGS, NEFT, ECS and
fraud is high.
Another test was conducted to find out whether there is any significant
association between age group and level of problems perceived by e-banking
customers with respect to ATM, debit card, credit card, net banking, mobile
banking and problems related to fraud. It reveals that age group below 30 years
is facing lesser problems with respect to ATM. The mobile banking customers
in the age of 40-50 years are facing high level problems and the age group
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below 30 years is facing low level of problems. It also reveals that debit card
holders in the age group of 30-40 years are facing high level of problems and
age group below 30 years is facing lesser problems.
Next test was to find out whether there is as association between
occupation and level of problems perceived by e-banking customers with
respect to ATM, debit card, credit card, net banking, mobile banking, RTGS,
NEFT, ECS and problems related to fraud. It reveals that level of problems of
Government employees is higher with respect to ATM than other e-banking
customers in different occupational status.
It also reveals that Government employees holding credit cards and
debit cards are facing higher level of problems. As for as net banking related
problems is concerned, private employees are facing lesser problems than other
net banking users. Further, the Government employee’s perception on
problems related to fraud is high in comparison with other e-banking
customers.
The sixth chapter analyses the satisfaction level of e-banking customers
of SBI and ICICI banks with respect to e-banking products and services in
Thanjavur town. The satisfaction of e-banking customers towards e-banking
products and services were assessed on the basis of parameters such as e-
banking facilities and quality of services which includes accuracy,
confidentiality, good complaint handling, clear communication, No breakdown
of machine/services. Prompt response to customer’s request, easy connectivity,
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adoption of user friendly technology, connectivity with other banks and
secured transactions. Based on these parameters, the overall satisfaction level
of e-banking customers was found. In identifying the satisfaction level five
point scale has been used. The five point scale is categorized in to Excellent,
very good, just satisfactory, poor and very poor.
The analysis of satisfaction of e-banking customers reveals that their
overall satisfaction towards e-banking is moderate. It means the respondents
are not fully satisfied with e-banking services provided by SBI and ICICI
banks. The analysis reveals that the satisfaction level of ATM – cum – Debit
card users of both banks is moderate, but comparatively the satisfaction level of
ICICI ATM – cum debit card users is higher than SBI debit card holders –
similarly the satisfaction level of ICICI bank’s credit cardholder is higher than
SBI credit card holders. The analysis further reveals that the satisfaction level
of internet banking and mobile banking users of ICICI bank is higher than SBI.
However in case of NEFT, SBI customer’s satisfaction is higher than ICICI.
The SBI ECS user’s satisfaction is higher than ICICI bank’s ECS users. The
analyses of satisfaction also reveal that the RTGS users and any branch
banking users of ICICI bank have higher satisfaction than the customers of
SBI.
An application of chi-square was conducted to find out if there is any
significant different between level of satisfaction of e-banking customers of
SBI and ICICI banks. It was found the there is a significant difference between
satisfaction level of e-banking customers in SBI and ICICI banks. The
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satisfaction level of ICICI bank’s customers is higher than SBI bank’s
customers.
Various test was conducted to find out if there is any significant
different exist between male and female respondents with respect to
satisfaction level. It was found that there is a significant difference between
male and female respondents. The test also reveals that there is a significant
difference between satisfaction level of married and unmarried respondents.
Another test was conducted to find out if there is any significant difference in
satisfaction level of respondents in different age group. It was found that there
is a significant difference in the satisfaction level respondents in different age
group and the satisfaction level of age group of above 50 years is high. The
satisfaction level of age group 30-40 years is low.
The next test was conducted to find out if there is any significant
difference in the satisfaction level e-banking customers with difference
education qualification reveals that there is a significant difference between
satisfaction level of e-banking customers and their education qualification and
the satisfaction level of professional is high and the satisfaction level of
customers with doctorate qualification is low. Another test was conducted to
find out if there is any association between occupational status, monthly
income and satisfaction. It reveals that there is a significant association
between occupational status, monthly income and satisfaction. It also reveals
that the satisfactions level of government employee is low and the satisfaction
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level of income group whose earning is below Rs.15,000 is high and the
satisfaction level income group Rs.25,000-40,000 is low.
An application of chi-square test was conducted for assessing if there is
any association exists between overall problem and overall satisfaction. It
reveals that there is an association between overall problem and overall
satisfaction. The problems of e-banking customers are moderate and the
satisfaction is also moderate.
Finally, the seventh chapter is a summary of major findings and
conclusions are outlined briefly based on the analysis and evaluations of the
study. This chapter includes valuable suggestions for improving e-banking
services and also identified future scope for the future research to the
researcher in Thanjavur.
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7.1 MAJOR FINDINGS
The analysis of the primary data collected from the respondents reveals
the following facts and findings.
� The analysis reveals that out of total 482 respondents, 78.8 percent were
male and 21.2 percent female. It is concluded that the majority of the
respondents were male. The reason for the low proportion of female e-
banking users is the lack of awareness among them.
� Majority of the respondents (41.1%) using e-banking products belong to
30-40 years age group, 24.7 percent to 40 -50 years, 22.8 percent to
below 30 years and 11.4 percent belongs to above 50 years age group.
The post graduates are the largest (40%) among 482 e-banking
customers. The second largest users of e-banking products are graduates
(27.4%) followed by 18.9 percent professionals, 9.3 percent others and
4.4 percent doctorates.
� The occupational status of e-banking customers reveals that 12 percent
are businessmen, 15.6 percent are professionals, 32.6 percent
Government employees, 26.8 percent private employees, 5.8 percent
retired persons, and the remaining 7.3 percent other category. It is
concluded that majority of the respondents were salaried class.
� The monthly income of the respondents’ shows that 27.2 percent of e-
banking customers belong to the income group earning less than
Rs.15000, 32.2 percent to the Rs.15000 – 25000 category, 22.8 percent
represent monthly income between Rs.25000 and Rs.4000, 11.2 percent
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between Rs.40000 and Rs.60000 and 6.6 percent more than Rs.60000. It
is concluded that majority of the e-banking customer’s monthly income
is between Rs.15000 and Rs.25000. The marital status shows that 82
percent of the respondents were married and 18 percent unmarried. It is
concluded that the majority of the respondents are married.
� It is evident from the analyses that 100 percent of respondents (482) are
using ATM-cum-debit card and ATM facilities. Out of 482 respondents
38.2 percent are credit card users, 27 percent net banking users, 11.2
percent mobile banking users, 9.5 percent NEFT, 8.3 percent RTGS and
10.5 percent are any branch banking users and only 6.6 percent are ECS
users. It is concluded that most of the respondents are multi-product
users. E-banking facilities such as mobile banking, NEFT, RTGS, ECS
and any branch banking are used by few respondents only. So the banks
should adopt appropriate promotional strategy to promote their e-
banking products to increase its penetration.
� The analysis reveals the majority of the respondent’s preference and the
reason for preferring e-banking products shows that 34 percent prefer
for convenience, 29.7 percent for time saving, and 19.5 percent for
avoiding risk of carrying cash, 10.4 percent for easy transfer of funds
and 6.4 percent for easy global access. It is concluded that E-banking
products are preferred by them not only for convenience and to avoid
risk of carrying cash but also for saving time of doing banking
operations.
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� The motivational factor which influence the selection of e-banking
products show that 34.4 percent were influenced by friends and
relatives, 27.2 percent by bank employees, 13.7 percent by
advertisement, 11.2 percent by sales executives, 8.9 percent by other
than these factors. It is concluded that majority of the respondents were
motivated by friends and relatives and bank employees.
� The duration of using e-banking products reveal that 50.2 percent are
using for more than 5 years, 27.2 percent for 2-5 years, 13.7 percent for
1-2 years and 8.7 percent for less than one year. It is concluded that
majority of the respondents are using e-banking products for more than
five years. The analysis of number of times banking transactions done
through electronic channels by e-banking users reveal that majority
(41.3%) of the respondents used electronic channels 5-15 times in the
past three months, 24.7 percent 15-30 times, 15.6 percent 1-5 times, 8.3
percent 30-50 times, 5.8 percent more than 50 times and 4.4 percent of
the respondents have not used electronic channels for the past three
months. It is concluded that majority of the respondents have not used
electronic banking products frequently.
� The analysis reveals that internet banking facilities are highly used by
businessmen as 35.4 percent of the internet banking users are
businessmen, 21.5 percent professional, 20.8 percent Government
employees, 17.7 percent private employees. Majority of the credit card
users are Government employees (37.5 percent) and private employees
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(28.3%). Mobile banking facilities are highly used by Government
employees (33.3%), private employees (27.8%) and professionals
(25.9%). The RTGS (70%) NEFT (43.5) and ECS (34.4%) facilities are
highly used by businessmen.
� The analysis of monthly income of internet banking users reveals that
31.5 percent belongs to income group earning between Rs.40,0 00 and
60,000, 29.2 percent to the Rs.25000 – 40000 and 23.1 percent to above
Rs.60000 income group. It is concluded that majority of the internet
banking users belong to high income group. Majority of the NEFT
(41.3%) and RTGS (55%) users belong to high income group. The
income analysis of credit cardholders shows that 42.9 percent belong to
income group of Rs.15,000 – 25,000, 35.3 percent to Rs.25,000 – 40000
and 10.3 percent represents income group of Rs.40000 – 60000. It is
concluded that majority of the credit cardholders belong to income
group earning between Rs.15, 000 and 25,000 and majority of the
mobile banking users (42.61%) belong to income group earning between
Rs.25, 000 and 40000.
� The analysis of the respondents’ view on security of transaction done
through electronic channels and service level improvement reveals that
19.5 percent feel very much secure with the electronic channels, 49.6
percent somewhat secure, 9.5 percent somewhat insecure and 3.1
percent feel very much insecure with electronic channels. The analysis
also reveals that majority of the respondents (59.8 %) accepted that
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electronic channels have improved the service level. It is concluded that
majority of the respondents felt somewhat secure when they transact
through electronic channels and not very much secure. Hence, the study
banks should ensure the security of information and privacy and try to
make e-banking customers feel secure.
� A test was conducted for assessing if there is an association between
age, occupation and the number of years of availing e-banking services.
It reveals that respondents in the age group of above 40 years were
availing e-banking services for more periods than other age group.
Further it reveals that there is no association between occupation and
number of years of availing e-banking services.
� Another test was conducted to find out if there is an association between
age, occupation, monthly income and frequency of using e-banking
products. It reveals that businessmen are using e-banking products more
frequently than others and majority of the higher income group of
respondents are using e-banking more frequently than lower income
group.
� The multiple response analysis of awareness of ATM – cum – debit card
holders with respect to convenience services reveals that majority of the
respondents in both SBI and ICICI bank are aware of convenience
services offered at ATM. Besides basic convenience services such as
balance enquiry (100%), cash withdrawal (100%), the services that are
known to majority of the debit card holders, in ICICI bank are: obtain
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statement of a/c (79.8%), deposit of cash (77.1%), Fast cash (64.9%),
cheque book request (46.2%). In SBI as well all debit card holders are
aware of basic convenience services such as balance enquiry and cash
withdrawal. Besides these services, the services that are known to
majority of SBI debit card holders are: obtain statement of a/c (92.7%)
change of PIN (88.2), fast cash (62.3%), cash deposit (45%).
� The multiple response analysis of awareness of ATM – cum - debit card
holders reveals that 224 cardholders from ICICI bank and 164
cardholders from SBI bank accepted that they are aware of value added
services provided at ATM. The services that are known to majority of
the ICICI cardholders are: Fund transfer (63.4%), credit card bill
payment (75,4%), Insurance payment (50.9%), Mobile top-ups (69.6%),
card to card transfer (45.1%). The services that are known to majority of
SBI card holders are: Fund transfer (93.5%), credit card bill payment
(50.6%), Insurance payment (56%), Mobile top-ups (50%), card to card
transfer (57,1%). It is concluded that majority of cardholders from the
study banks are aware of many value added services and the services
that are known to few card holders are card to a/c transfer, educational,
holy and trust donation payment services at ATM.
� The multiple response analysis of awareness of debit card holders with
respect to services available at point of sale reveals that 258 cardholders
from ICICI bank and 219 from SBI bank accepted that they are aware of
services provided at POS. Besides payment for purchases, the services
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that are known to majority of the ICICI cardholders are: SMS alert
(91.5%), Reward points (64.9%), discount (45.6%) cash withdrawal at
POS (47.9%). In case of SBI, SMS alert (94.5%), Reward points
(72.6%), Discount (35.2%), cash withdrawal at POS (28.8%).It is
concluded that in both banks the majority of the card holders are aware
of services provided at POS. The awareness of cardholders towards
certain POS services is low such as cash withdrawal at POS, and
surcharge waiver.
� The analysis of e-banking customers’ awareness towards other services
of debit cards shows that 253 respondents from ICICI and 213 from SBI
accepted that they are aware of other services of debit card. The
percentage of ICICI respondents who are aware of other debit card
services is high with respect to services such as: operate multiple
accounts with single card (57.3%), online utility payment (87.4%) and
online purchases (98%). In SBI as well, services such as online utility
bill payment (97.2%), online purchase (94.8%) and operate multiple a/c
with single card (59.6%) are known to majority of the cardholder. It is
concluded that the banks should create awareness among cardholders
about services such as lost card liability cover, purchase protection and
personal accident cover offered along with debit card.
� The multiple response analysis of awareness of SBI and ICICI
customers towards convenience services of Internet banking reveals that
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the percentage respondents who are aware of convenience services of
net banking is very high in both banks.
� The analysis of awareness of customers towards value added services of
net banking reveals that 69 net banking users of ICICI and 55 net
banking users of SBI accepted that they are aware of value added
services. It reveals that in both banks the services that are known to
majority of net banking users are online railway ticket booking, online
air ticket booking, online shopping, income and service tax payment and
access credit details through net banking. It is concluded that the value
added services such as linking of credit card a/c and Demat a/c, online
custom duty payment through net banking are not popular among net
banking users in this area. So the study banks should take steps to
promote their value added services in this area of study for higher
penetration.
� The multiple response analysis of awareness of mobile banking
customers towards information based mobile banking services reveals
that besides the basic information based services such as balance
enquiry (100%), get last 5 transaction details (100%), the services that
are known to majority of the mobile banking users in ICICI bank are:
Locate branch/ATM (96.6%), status of service request (75.9%), get
credit card details (65.5%), cheque status enquiry (62.1%) and cheque
book request (55.2%). The percentage of mobile banking users of SBI
bank who are aware of information based services of mobile banking is
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high with respect to services such as: Locate branch/ATM (92%), status
of service request (56%), get credit card details (60%), cheque status
enquiry (96%), cheque book request (68%). It is concluded that services
such as apply for bank products, stop cheque request, get details of loan
a/c and demat a/c, are not popular among mobile banking users.
� The multiple response analysis of awareness of mobile banking users
towards transaction based services offered by SBI and ICICI banks
reveals that majority of mobile banking users of these two banks are
aware of transaction based services. In ICICI the percentage of
respondents aware of transaction based services are: bill payment
(73.1%), Fund transfer (73.1%) and prepaid mobile recharge (64.4%). In
SBI the percentage of respondents aware of these services are: bill
payment (73.7%), fund transfer (84.2%) and prepaid mobile recharge
(42.1%).
� The multiple response analysis of the awareness of credit card holders
towards convenience services of credit card offered by SBI and ICICI
banks reveals that majority of cardholders in both banks are aware of
many convenience services. The services that lack customer’s awareness
and attention are online management of card; auto debit facility and
credit card bill payment through ECS service as these are known to few
card holders.
� The analysis of awareness of credit card holders towards value added
services reveals that 87 respondents of ICICI bank and 54 respondents
435
of SBI bank accepted that they are aware of value added services of
credit card. In ICICI, 93.1 percent aware of interest free credit period,
48.3 percent balance transfer facility, 35.6 percent Dial-a-draft facility
and only 25.3 percent aware of personal loan on card service. In SBI,
94.4 percent aware of interest free credit period, 40.7 percent dial-a-draft
facility, 27.4 percent balance transfer and only 13 percent aware of
personal loan on card facility. It is concluded that the awareness of
cardholders towards value added services of credit card is low. So the
banks should take appropriate steps to promote value added services of
credit card in this area of study.
� The multiple response analysis of awareness of credit card holders
towards benefit services reveals that 102 cardholders of ICICI bank and
79 cardholders of SBI bank accepted that they are aware of benefit
services of credit card. In ICICI, the services that are known to majority
of cardholder are: Add on card (95.1%), Revolving credit facility
(64.7%), Reward points (73.5%), Limited lost card liability (54.9%),
and temporary credit limit (50%). In SBI, the services known to
majority of card holders are: Add on card (81%), revolving credit
(64.6%), and reward points (88.6%). It is concluded that comparatively
ICICI bank’s credit card holder’s awareness towards benefit services are
higher than SBI as the percentage of respondents aware of other benefit
services such as temporary credit limit, permanent credit limit, self -
set/monthly preset limit, limited lost card liability cover and fuel
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surcharge waiver is lesser than ICICI. So, the SBI should take steps to
create awareness about these benefit services.
� The analysis of awareness towards insurance services of credit card
offered by SBI and ICICI banks reveals that 71 cardholders of ICICI and
only 57 cardholders of SBI have accepted that they are aware of
insurance service of credit card. It is concluded that in both banks the
number cardholders who are aware of insurance services is less and
majority of them are aware of credit shield cover, life insurance on
cardholder and purchase protection service. So, the study banks should
take necessary steps to increase the cardholder’s awareness towards
insurance services of credit card.
� A test was conducted to find out whether there is any association
between age and awareness with respect to dimensions of e-banking
products. It reveals that there is an association between SBI bank’s debit
card holder’s awareness with respect to convenience services, services at
POS and age group. It is concluded that the awareness of age group
below 30 years and 30-40 years is higher than other age group. The
awareness of age group of above 50 years is very low. There is a
significant association between age group and awareness of ICICI
bank’s net banking customers towards value added services. The age
group of 30-40 years and 40-50 years is highly aware of value added
services of net banking. It reveals that there is a significant association
between age group and awareness of ICICI bank’s credit card holders
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with respect to benefit services. It is concluded that the awareness of
younger age group is lesser than other age group.
� A test was conducted to find out, whether there is an association
between gender and awareness with respect to dimensions of e-banking
services. It reveals that there is an association between gender and
awareness of ICICI bank’s debit card holders with respect to other
services of debit card. The awareness of male cardholder is higher than
female. There is a significant association between gender and awareness
of ICIC bank’s net banking customers with respect to convenience
services and value added services of net banking. The awareness of male
is higher than female with respect to convenience services and value
added services of net banking. The test also reveals that there is an
association between gender and awareness of SBI bank’s credit card
holders with respect to insurance services of credit card and it is
concluded that the awareness of male is higher than female.
� A test was conducted to find out if there is any significant association
between educational qualification and awareness of e-banking
customers with respect dimensions of e-banking services. It shows that
there is an association between educational qualification and awareness
of ICICI bank’s debit card holders with respect to value added services
at ATM. It is concluded that the awareness of graduates is higher than
others with respect to value added services. The test also reveals that
there is an association between educational qualification and awareness
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of SBI bank’s Internet banking customers with respect to convenience
services. It shows that the awareness of graduates is higher than others
with respect to convenience services of net banking. There is an
association between educational qualification and awareness of ICICI
bank’s credit card holders with respect to insurance services. In SBI the
awareness of credit holders with professional qualification is higher than
others with respect to convenience and benefit services of credit card.
� The multiple response analysis of utilization of ATM – cum – debit card
holders with respect to convenience services at ATM reveals that 100
percent of the debit card holders use ATM to withdraw cash and for
balance enquiry. Other than cash withdrawal, the services that are highly
used by ICICI debit card holders at ATM are: obtain statement of a/c
(75.2%), change of PIN (71.8%) and shared ATM (86.3%). In SBI,
highly used services are: obtain statement of a/c (92.3%), change of PIN
(62.7%) and shared ATM (77.3%). It is concluded that services such as
cash deposit through debit card and cheque book request services are not
used by many cardholders. Hence the banks should take steps to
encourage customers to use more and more convenience services.
� The multiple response analysis of utilization with respect to value added
services at ATM reveals that only 138 debit card holders of ICICI bank
and 83 debit card holders of SBI have accepted that they utilize value
added services at ATM. Among them, the services that are highly
utilized by ICICI customers are: Fund transfer (49.3%), credit card bill
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payment (40.6%) and mobile top-ups (40.6%). Similarly, the services
highly used by SBI card holders at ATM are: Fund transfer (56.6%),
credit card bill payment (43.4%) and mobile top-ups (24.1%). It is
concluded that the percentage of debit cardholders using value added
services is very low. So the study banks should take necessary steps to
encourage customers to use more and more value added services at
ATM through appropriate promotional strategy.
� The analysis of debit card holders’ usage with respect to services at POS
reveals that 214 card holders of ICICI bank and 197 card holders of SBI
use debit cards at point of sale. The services that are highly utilized by
ICICI card holders at POS are: SMS alert (83.2%), reward points
(23.4%). As for as SBI cardholders is concerned, SMS alert (77.7%) and
reward points (51.3%) services are highly used by them. It is concluded
that the services such as discount, surcharge waiver and cash withdrawal
at POS are not all used by many cardholders.
� The analysis of utilization with respect to other services of debit card
reveals that 199 cardholders of ICICI bank and 139 card holders of SBI
have accepted that they use these services. The services that are highly
used by these cardholders are online utility bill payment (86.9%) in case
of ICICI and (86.3%) in case of SBI and online purchase. Besides these
services, lost card liability cover, purchase protection and personal
accident cover are not used by majority of the debit card holders.
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� The analysis of utilization with respect to convenience services of net
banking reveals that 100 percent of net banking users utilize net banking
for accessing account information. The services that are highly used by
ICICI bank net banking users are bill payment and presentment
(76.7%), Bank statement by email (69.9%) inter branch, fund transfer
(own a/c), (71.2%) and fund transfer to third party a/c (91.8%) and
cheque status enquiry (54.8%).In SBI, net banking customers mainly
utilize services such as bill payment and presentment (73.7%), bank
statement by email (84.2%), inter branch fund transfer to own a/c
(82.5%), inter branch fund transfer to third party a/c (94.7%) transfer to
any bank a/c (64.9%).
� The analysis of utilization with respect to value added services of net
banking reveals that 64 net banking users of ICICI bank and 55 net
banking users of SBI have accepted that they are utilizing value added
services. The main services utilized by Internet banking customers of
both banks are online railway ticket booking and online shopping. Other
services in the category of value added services are not used by many
internet banking customers.
� The analysis of utilization with respect to information based mobile
banking services reveals that majority of the mobile banking customers
(100%) of both banks are using mobile banking for balance enquiry and
to get last 5 transaction details. Services such as , cheques status
enquiry, get credit card details, locate branch/ATM, status of service
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request services are utilized by reasonable number of mobile banking
users.
� The analysis of utilization with respect to transaction based mobile
banking services reveals that 15 mobile banking users of ICICI bank and
10 mobile banking users of SBI have accepted that they are utilizing
transaction based services. Among them, 66.7 percent of ICICI bank
users and 70 percent of SBI bank users bill payment services. Fund
transfer through mobile is utilized by 60 percent of ICICI users and 60
percent of SBI mobile banking users. Still the number of users of
transaction based services is low. So, the study banks should take
necessary steps to increase the usage of transaction based services by
customers.
� The analysis of utilization with respect to convenience services of credit
card reveals that besides usage of credit card for purchases, credit card
holders of SBI and ICICI banks are using it mainly for cash withdrawal,
online railway ticket booking. The SMS facility is used by 78.6 percent
of ICICI cardholders and 87.7 percent of SBI cardholders. The main
payment options used by cardholders are cash/cheque/draft and drop
boxes. 54.4 percent of ICICI cardholders and 44.4 percent of SBI
cardholders use ATM for credit card bill payment. Payment through
ECS and auto debit facility is not at all used by many card holders. This
may be due to lack of awareness.
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� The multiple response analysis of utilization with respect to value added
services of credit card reveals that 83 credit card holders of ICICI bank
and 52 credit card holders of SBI have accepted that they are utilizing
value added services. Among various services the only service that is
used by majority of them is interest free credit period. Other value added
services such as balance transfer facility, dial-a-draft facility and
personal loan on card are not used by many cardholders. This is mainly
due to lack of awareness among cardholders. So the banks should take
necessary steps to create awareness and encourage customers to use
these benefit services.
� The multiple response analysis of utilization with respect to benefit
services of credit card reveals that 96 card holders of ICICI and 67 card
holders of SBI have accepted that they are aware of benefit services of
credit card. The services that are highly used by ICICI card holders are:
add on card facility (61.5%), Revolving credit facility (58.3%), Reward
points (39.6%), permanent credit limit enhancement (31.3%).. The
services that are highly used by SBI credit and holders are : Add on card
(56.7%) revolving credit facility (70.1%), reward point (67.2%).Other
benefit services such as temporary credit limit, self-set /monthly preset
credit limit, limited cost card liability are not highly used by credit card
holders of both banks. But comparatively the utilization of benefit
services by ICICI card holder is higher than SBI.
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� The multiple response analysis of utilization with respect to insurance
services of credit card reveals that 69 cardholders of ICICI bank and 42
cardholders of SBI are using Insurance services. Among the various
insurance services offered by banks credit shield cover is highly utilized
`by majority of the card holders. Another insurance service that is used
by reasonable number of card holders is life insurance on card. It is 44.9
percent in case of ICICI and 33.3 percent in case of SBI.
� The analysis of utilization with respect to any branch banking reveals
that the utilization level of ICICI customers is higher than SBI
customers as the percentage of users of various services provided
through any branch banking in ICICI bank is higher than SBI. This is
mainly due lack of awareness among SBI customers. Hence the SBI
should take necessary steps to create awareness among customers about
any branch banking services.
� A test was conducted for assessing if there is way significant association
between occupation and utilization of various dimensions of e-banking
services. It reveals that there is a highly significant association between
occupation and utilization with respect to services at POS and other
services of debit cards. The services provided at POS and services under
the head ‘other services’ are highly used by businessman. There is a
significant association between occupation and utilization of SBI debit
card holders with respect to various dimensions of debit card service. In
SBI, the convenience services at ATM are highly used by Government
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employees and the value added services at ATM, POS services and
other services of debit card are highly used by businessmen. The
analysis also reveals that there is a significant association between
occupation and utilization of net banking users of SBI and ICICI bank.
The convenience and value added services, provided by these banks
through net banking is highly used by businessmen. There is no
significant association between occupation and utilization of various
dimensions of mobile banking services. But there is a significant
association between occupation and utilization of ICICI bank’s credit
cardholders with respect to convenience services and these convenience
services are highly used by businessmen. In SBI, convenience services
of credit card are highly used by private employees and benefit services
are highly used by professionals and business.
A test was conducted to find if there is any association between
monthly income and utilization with respect to various dimensions of e-
banking services. It reveals that there is an association between monthly
income and utilization of ICICI bank’s debit card holders with respect to
value added services, services at POS and other services of debit card. The
services at POS are highly used by income group whose earnings are above
Rs.25000 and other debit card services are highly used by income group of
Rs.40000 – 60000.
There is a significant association between monthly income and
utilization of SBI bank’s debit card holders with respect to various
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dimensions of debit card services. In SBI, the convenience services of debit
card are highly used by income group Rs.25000 – 40000. Value added
services are highly used by income group above Rs 60000 and the services
at POS are highly used by customers whose income is above Rs.40000. The
services that are listed in the category ‘other services’ are highly utilized by
customers whose income as above Rs.60000. The analysis of association
between monthly income and utilization of ICICI bank’s net banking users
with respect to various dimensions of net banking services reveals that there
is a significant association between monthly income and utilization of
convenience services of net banking. The convenience services of net
banking are highly used by income group whose earning is above Rs.60,
000. In case of SBI there is a significant association between monthly
income and utilization with respect to dimensions of net banking services
and the utilization of income group whose earning is above Rs.60, 000 is
higher than other income group. There is a significant association between
monthly income and utilization of ICICI bank credit card holders’ with
respect to convenience services and insurance services. These services are
highly used by the income group whose earning is above Rs.60,000. In case
of SBI, the convenience services and insurance services of credit card is
highly used by cardholders whose monthly income is above Rs.60,000.
� The analysis to find out the problems perceived by the respondents in
SBI and ICICI banks shows that if they are interested in contacting the
banks for their problems related to e-banking, it represents 66 percent
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interested and 34 percent were not able to make complaint to banks for
their problems. It is concluded that majority of the respondents are
interested in making complaint about their problems to the banks.
� The respondents’ reasons for not making complaints to the banks reveal
that 39.7 percent were busy with their work, 26.2, percent felt that their
previous efforts failed, 19.5 percent felt that their problems may be
rectified automatically by banks and 14.6 percent had other reasons such
as customer service centers always busy, unaware of proper channel for
complaint making and fear of tedious procedures involved. It reveals
that majority of the respondents were busy with their work and the
failure of previous effort had an impact on them. It is concluded that the
study banks should take necessary steps to keep the customer aware of
the proper channels to make complaints, simplify the grievance handling
methods and to easily communicate in their local language effectively
for solving problems quickly.
� An analysis was conducted to find out the methods of complaining by
respondents’ shows that 56 percent complain through helpline, 25.8
percent through internet, and only 18.2, percent through other modes
such as e-mail, SMS and by directly meeting the bank officials. It
reveals that the majority of the respondent gave complaints through
helpline. It is concluded that the banks should provide more helpline
services for handling problems quickly.
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� The number of times complaints made by respondents to banks
represent that 63.4 percent approached less than 3 times, 20.4 percent 3
to 6 times and 14.2 percent more than 6 times. It is concluded that
majority of the respondents have given complaints less than 3 times.
� An analysis was conducted to find out whether the problems of credit
card holders were solved by banks or not. It reveals that 72.3 percent of
problems were solved by the banks and 27.7 percent of respondents’
problems were not solved by the banks. It is concluded the banks should
take steps to solve all the problems for e-banking customers for better
satisfaction.
� The duration of time taken or required for the banks to solve the
problems of e-banking customers reveals that 61.7 percent of the
problems were solved with a week. More than a week was required to
solve 28.7 percent of problems, 9.6 percent of problems were solved
within a day. It is concluded that the majority of e-banking customer’s
problems were solved in a week. The banks should take necessary steps
to solve the problems quickly for better satisfaction.
� The overall level of problems perceived by the respondents in this area
reveals that 40 percent of respondents’ problems were moderate, 29.7
percent high and 30.3 percent were low. It is concluded that the majority
of e-banking customers faced moderate problems in the study area.
� The analysis was conducted to find out the overall satisfaction of e-
banking customers with respect of problems handled or being handled
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by study banks shows that 37.8 percent of the respondents were
satisfied, 25.3 percent dissatisfied, 13.5 percent neither satisfied not
dissatisfied, 14.1percent were highly satisfied and 9.3 percent highly
dissatisfied. It is concluded that the overall satisfaction of respondents
toward problem handling is average, the study banks should take
necessary steps to examine and find an alternative way of grievance
redressal method for better satisfaction.
� A test was conducted to find out if there is any significant difference
between SBI and ICICI bank’s e-banking customers and their level of
problems with respect to ATM, credit card, and debit card, net banking,
mobile banking, RTGS, NEFT, ECS and any branch banking. It reveals
that there is a significant difference between e-banking customers of SBI
and ICICI bank and their level of problems with respect to each e-
banking product and problems related fraud. It is concluded that the
problems perceived by SBI bank’s e-banking customers with respect to
ATM, debit card, credit card, internet banking, RTGS, NEFT , ECS and
fraud is high. The problems perceived by ICICI bank’s e-banking
customers with respect to mobile banking and any branch banking are
high. A test was conducted to find out if there is any significant
association between age group and level of problems perceived by e-
banking customers with respect to ATM, debit card, credit card, net
banking, mobile banking and problems related fraud. It reveals that there
is an association between age group and level of problems with respect
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of ATM. The age groups below 30 years are facing lesser problems than
other age group. There is an association between age group and level of
problems with respect to debit card. It reveals that debit card holders in
the age group of 30-40 years are facing high level of problems. There is
an association between age group and level of problems with respect to
mobile banking. It reveals that mobile banking customers in the age of
40-50 years are facing high level of problems and the age group of
below 30 years is facing low level of problems. There is also an
association between age group and level of problems related to fraud. It
reveals that e-banking customers in the age group of above 50 years are
facing lesser fraud related problems compared to other age group.
� A test was conducted to find out if there is an association between
occupation and level of problems perceived by e-banking customers
with respect to ATM, debit card, credit card, net banking, mobile
banking, RTGS, NEFT, ECS and problems relate to fraud. It reveals that
there is an association between occupation and level of problems with
respect to ATM and the level of problems of Government employees are
higher than businessmen, professionals and other e-banking customers.
There is an association between occupation and level of problems with
respect to credit card and the Government employees having credit cards
are facing higher level of problems and the problems of businessmen is
less. The test also reveals that there is an association between occupation
and level of problems of debit card holders and the Government
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employees’ perception on problems related to debit card is high. As for
as, net banking is concerned private employees are facing lesser
problems than other net banking users. There is a significant association
between occupational status of e-banking customers and their level of
problems related to fraud. It reveals that Government employees’
perception on problems related to fraud is higher in comparison with
other e-banking customers.
� An analysis was conducted to find out the overall satisfaction of e-
banking customers. It reveals that 21 percent have low level of
satisfaction, 48.5 percent have moderate satisfaction and 30.5 percent
have higher satisfaction. It is concluded that the satisfaction of e-
banking customers is moderate. It means that the respondents are not
fully satisfied with the e-banking services provided by SBI and ICICI
banks. So, the banks should to be necessary steps and adopt appropriate
strategy to improve their quality of services for their customers’ higher
level of satisfaction.
� The analysis of satisfaction level of SBI and ICICI bank’s ATM – cum –
Debit card users reveals that 19.1 percent of ICICI customers have low
level of satisfaction, 45.4 percent moderate level and 35.5 percent have
higher level of satisfaction. In SBI, 23.2 percent have low level of
satisfaction, 52.3 percent moderate, and 24.5 percent have high level of
satisfaction. It is concluded that both bank’s ATM – cum debit card
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holders satisfaction is moderate, but comparatively the satisfaction level
of ICICI bank’s ATM-cum-debit card users are higher than SBI.
� The analysis of satisfaction level of SBI and ICICI bank’s credit card
holders reveals that 26.2 percent of ICICI credit card holders have low
level of satisfaction, 35.9 percent moderate and 37.9 percent high level
of satisfaction. In case of SBI, 38.3 percent have low level of
satisfaction, 43.2 percent moderate and 18.5 percent high level of
satisfaction. It is concluded that the satisfaction level of ICICI bank’s
credit card holders is higher than SBI.
� The analysis of satisfaction level of internet banking users of ICICI and
SBI banks reveals that 20.5 percent of ICICI net banking users have low
level of satisfaction, 39.7 percent moderate, and 29.7 percent have
higher level of satisfaction. In case of SBI, 26.3 percent have low
satisfaction, 50.9 percent moderate and 22.8 percent have higher level of
satisfaction. It is concluded that the satisfaction level of ICICI bank’s
net banking users is higher than SBI. So the SBI should assess their
customer’s needs and expectations for improving the facilities provided
under net banking and should adopt appropriate strategy to improve the
quality of their net banking services for height customer satisfaction.
� An analysis was conducted to assess the satisfaction level of mobile
banking users’ of SBI and ICICI banks. It reveals that 27.6 percent of
ICICI bank’s mobile banking users have low level of satisfaction, 37.9
percent have moderate level and 34.5 percent have high level of
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satisfaction. In case of SBI it represent 32 percent low satisfaction, 40
percent moderate, 28 percent higher satisfaction. It is concluded that the
satisfaction level of ICICI bank’s mobile banking users is higher than
SBI.
� The analysis of satisfaction level of SBI and ICICI bank’s NEFT users
reveals that 27.6 percent of ICICI NEFT users have low satisfaction, 44
percent moderate and 24 percent higher satisfaction. In case of SBI, it
represents 14.3 percent low satisfaction, 47.6 percent moderate and 38.1
percent higher satisfaction. It is concluded that the satisfaction level of
SBI NEFT users is higher than ICICI.
� An analysis was conducted to assess the satisfaction level of RTGS
users of SBI and ICICI banks. It reveals that 18.2 percent of ICICI
bank’s RTGS users have low satisfaction, 45.5 percent have moderate
and 36.4 percent have high satisfaction. In case of SBI, 11.1 percent
have low satisfaction, 66.7 percent have moderate, and 33.3 percent
have higher satisfaction. It is concluded that the satisfaction level of
ICICI bank’s RTGS users is higher than SBI.
� The analysis of satisfaction level of ECS users reveals that 38.5 percent
of ICICI bank’s ECS users have low satisfaction, 30.8 percent moderate
and 30.8 percent have higher satisfaction. In case of SBI, 10.5 percent
represents low satisfaction and 52.6 percent moderate, and 36.8 percent
represents higher satisfaction. It is concluded that the satisfaction level
of SBI bank’s ECS users is higher than ICICI bank’s ECS users.
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� The analysis of satisfaction level of any branch banking users reveals
that 20 percent of ICICI bank’s customers have low satisfaction, 45
percent moderate and 35 percent have higher satisfaction. In SBI, 25
percent of any branch banking users have low satisfaction, 53.6 percent
moderate and 21.4 percent have higher satisfaction. It is concluded that
the satisfaction level of ICICI bank’s any branch banking users is higher
than SBI. So the SBI bank should take immediate steps and adopt right
strategy to provide more quality services for achieving higher level of
customer satisfaction.
� A test was conducted to find out if there is any significant difference
between level of satisfaction of e-banking customers in SBI and ICICI
banks. It reveals that there is a significant difference between
satisfaction level of SBI and ICICI bank’s e-banking customers and the
satisfaction level of ICICI bank’s e-banking customers is higher than
SBI. So the SBI bank should collect periodic reviews from customers to
understand their needs and expectations better and should adopt
appropriate strategy to promote e-banking services and improve the
quality of services which is essential for gaining higher customer
satisfaction.
� A test was conducted to find out if there is an association between
overall problems and overall satisfaction of e-banking customers. It
reveals that there is an association between overall problem and overall
satisfaction. The problems of e-banking customers are moderate and the
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satisfaction is also moderate. So, the study banks should take necessary
steps to redress the problems of e-banking customers quickly for higher
satisfaction in this area.
� A test was conducted to find out if there is any significant difference
between male and female respondents with respect to satisfaction level.
It was found that there is a significant difference between male and
female respondents and their satisfaction level. Another test was
conducted to find out if there is any significant difference between
married and unmarried respondents and their satisfaction level and it
was found that there exist difference between married and unmarried
respondents and their satisfaction level.
� A test was conducted to find out if there is any significant difference
between age group and satisfaction level. It was found that there is a
significant difference in the satisfaction level of respondents in different
age group and the satisfaction level of age group of above 50 years is
high and the satisfaction level of age group 30-40 years is low.
� A test was conducted to assess if there is any significant difference
between satisfaction levels of e-banking customers with different
educational qualification. It reveals that the satisfaction level of
professionals is high and the satisfaction level of customers with
doctorate qualification is low.
� A test was conducted to assess if there is any association between
occupation, monthly income and satisfaction level. It reveals that the
455
satisfaction level of Government employee is low and the satisfaction of
retired person is high. It also reveals that the satisfaction of the income
group whose earning is below Rs.15000 is high and the satisfaction level
of income group Rs.25000 – 40000 is low.
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7.2 SUGGESTIONS
The following are the important suggestions made by the researcher to
the banks particularly SBI and ICICI banks providing e-banking products and
services for improving their services and satisfaction of customers in Thanjavur
town.
� E-Banking is gaining momentum and the customers now prefer to avail
e-banking services. Among the various e-banking products, ATM is the
widely accepted and used facility of e-banking. Similarly the credit card
and debit card services have been widely welcomed by the people which
is evident from the phenomenal increase in the number of cardholders in
the country. But the number of users of other e-banking products such as
net banking, mobile banking, RTGS, NEFT and ECS are minimum. This
may be due to lack of awareness among the customers about e-banking
products and services and also the various facilities available within
each product. Therefore it is suggested that the banks should conduct
separate awareness campaign with regard to e-banking.
� To promote e-banking services it is of paramount importance that the
banks must ensure quality in customer services. Quality in service and
satisfaction of customers are the key words which must be given sternest
attention to promote a product.
� Customer relationship is one of the important aspects the banks need to
be given par importance. Addressing individual customer needs is one
crucial aspect to be considered, as the customer would find himself as a
457
part of the organization. This would build good relationship between the
bank and the customer.
� The bank has to ensure that the employees are properly trained, so that
they provide individualized attention to customers to make e-banking
services more customers friendly and they should also make effort that
customers feel safe and secure with their e-banking transactions with the
bank.
� Banks should encourage formation of user communities to get feedback
on the banks and also enhance the efficiency of their e-banking
products.
� Banks should embrace the use of social media as a source of banking
information.
� Banks should encourage customers to use electronic channels whenever
possible by using price incentives.
� Customers expressed displeasure at the low density of ATMs. More
centers should be placed in important places such as Railway Station,
Terminals, petrol banks, Hospitals, Schools, Colleges and which are
easily accessible and convenient for customers.
� Customers complained that while carrying out transactions at the ATM,
sometime the account is debited but cash not dispensed. This creates
dissatisfaction among customers. The banks should take steps to avoid
these defaults.
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� There was no definite grievance redressal mechanism in place with the
customer being out of funds for the time take by the banks to resolve the
complaint. Therefore there should be a zero liability clause whereby
immediately on being informed of an ATM failing to deliver cash, the
funds of the customers should be immediately restored.
� Customers felt that a camera or some other equipment evidencing cash
should be attached and once complaint is made it should be possible to
authorize restoration of funds online.
� As recommended by various committees, every ATM should be
provided with unique ID so that a mere reference to the same would
hasten redressal of the customer grievances.
� Many respondents complained that the physical security of ATM and
the safety situation in and around ATM is not sufficient. Therefore as
per the RBI request every bank should install remote monitoring device
that would automatically alert police about ATM tampering and the RBI
should made it mandatory.
� The banks must take steps to update the knowledge and awareness of e-
banking customers on recent changes in the terms and conditions and
usage and also about additional benefits and services made available on
e- channel usage from time to time.
� Majority of the cardholders in India are ignorant about the basic
information on card usage including the interest rate, charges on
outstanding balance and thus actually pay interest higher than what they
459
believe they are paying. This should be rectified by giving awareness to
the card holders.
� Majority of the cardholders are not aware of the extent of over the limit
or overdraft permitted to them. For a marginal excess over the limit, the
charges usually was more than the actual excess. There should be a
customer choice for operation of this facility.
� There are certain hidden charges and basis of applying interest is not
made known to customer, which implies that there is a lack of integrity
in communication.
� The credit card issuing banks should reasonably reduce their interest,
finance charges and penalty which will reduce their cardholder’s
dissatisfaction. The higher rate of interest nearly 36 percent claimed for
the loan through credit card is abnormal. The claim of such abnormal
rate of interest on loan should be reduced and equated to bank rate of
interest in ordinary transaction.
� Many respondents complained that the issuers of card do not send credit
card statements in time but they immediately close the account and
terminate their service, as cardholders will get shock when suddenly
huge amount are billed and fines are levied upon his account for non-
payment of dues due to non-availability of accounts. They do not send
account statement, and then charge fine as well as late fee when
customers fail to pay. These major problems experienced by the
respondents should be considered by issuers of card who should take
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steps for their customer friendly approach of sale and satisfaction of
cardholders.
� Most of the card holders send their cheque for payment but
unfortunately due to their busy routine schedules commit errors. But the
issuers inadvertently imposes penalty for such cardholders without any
intimation. They are also charging late payment fee for a short payment
of few paise. This will discharge usage and increase their dissatisfaction.
� Sending unsolicited credit card applications and receiving calls about
payment outstanding even after payment are the two important issues
which irritate the cardholders and created displeasure among them.
� Customers are finding it difficult to block or cancel a credit card. While
it is the easiest thing to get a card, sometimes even without asking for
them, but returning them seem to be a daunting task. The banks should
clearly state the procedure and also simplify the procedure of closure
and blocking of card.
� Customers should be able to send SMS to block the card if he observes
misuse.
� Customer education should receive top priority and cover the entire
gamut of credit card operations. Illustrative examples should be used.
Call centre employees should be suitably trained.
� Banks were not restoring funds debited to their accounts by cloned cards
from distant places. In a card present scenario such distant transactions
if not authorized by the customers should be immediately reversed.
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� There was no definite grievance redressal process to address complaints
in the nature of identity theft. While technological banking aspects like
net banking was convenient to customers and cost effective to the banks,
there should be total secure protection afforded to the customers against
any losses suffered on account of such banking.
� Normally banks restrict the amount that can be transferred online by
way of a day cap or by way of ceiling amount per transfer. It is
suggested that additional factor of authentication should be taken and
higher amount should also be permitted for online transfer.
� Additional authentication method should be introduced to authenticate
online usage of card or card not present transaction.
� The minimum limit fixed for RTGS should be reduced for Rs.1 lakh
which will bring more people to the electronic fund transfer system.
� E-cardholders experienced lack of proper security of online transactions.
Even though issuing banks have step up SET system to prevent
unauthorized access to cardholders’ particulars, it is not completely fool
proof and secure. Every bank should switch over to the use of chip
based card.
� The banks can provide service to ATM card holders with the help of
newly devised authentication system that keeps them informed of the
transaction before hand over their mobile phone. SMS alert on card
usage should be sent allowing the customer reply back in case of card is
not used.
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� SMS alert for every transaction irrespective of the size of the transaction
should be made mandatory.
� In every bank two-way authentication for internet banking and debit
card transactions at POS should be introduced. This will provide an
additional layer of security. In ICICI bank and additional factor of
authentication for net banking is a grid. But it should not be printed on
the back of the card but should be given separately so that a photocopy
of the card does not give away all the information required to make
online payment.
� Those who frequently use the mobile banking services usually do not
conduct much of financial transactions but find it very useful for
information based transactions mainly checking account details. It is
believed that ensuring security of mobile banking and familiarizing
customers with how to use the service will definitely increase the rate of
using mobile banking services.
� Customers normally not aware of the time frame for redressal of
grievance. The banks should display on the notice board the time frame
for redressal of different types of grievances.
� To bring more customers in to the electronic way of transactions, banks
should introduce biometric cards and biometric ATMs in Thanjavur
which will attract senior citizens and illiterate customer.
� Fraud related problems seem to occupy the foremost place. There should
be an open end discussion on the threat and vulnerability coming across
463
the functioning of internet banking by employees in the various official
forums.
� Bank must continue to educate their customers on emerging threats. It is
unfortunate that Indian banks do not report frauds because there is no
legislation to make fraud public. In India, banks are not legally
mandated to put fraud in public domain.
464
7.3 CONCLUSION
The study found that both SBI and ICICI bank’s e-banking customers
have moderate level of satisfaction and the satisfaction level of ICICI bank’s
customers is higher than SBI bank’s customers. However, both banks should
realize the strong need for customer education and care as satisfaction more
depends on product awareness and problem awareness. E-banking offers a high
level of convenience for managing one’s finance. However it continues to
present challenges to the financial security and personal privacy. Awareness of
problems enables one’s to take precautions for more secured transaction
therefore, customer education on fraud needs special emphasis. The continuous
availability of banking services with reliable and secured banking transactions
is the main expectations of banking customers. Hence, besides offering more
innovative and value added services banks should concentrate more on safety
and privacy of financial transactions. By offering more advanced security
solutions and ensuring safety of e-banking transactions banks can will delight
the customer.
465
7.4. SCOPE FOR THE FUTURE STUDY
E-banking is new and fast growing but all the e-banking product are not
popular in Thanjavur. Due to lack for awareness among people in Thanjavur,
the study is restricted to Thanjavur town and the products of banks particularly
SBI and ICICI which are highly used by the respondents in this area have been
selected for this study. The study has not included services of other banks. It
has also not included the services provided by the foreign banks due to non-
availability of their services in this area, since the researcher could not be able
to consider for the present study. The cross cultural differences across countries
can be studied for selected banks from other countries. This may be throwing
light on improving competitiveness globally. So the researcher has identified
the above limitations as a scope for the proposed future research to the
researcher in Thanjavur.
xxi
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xxviii
A STUDY ON CUSTOMERS’ SATISFACTION TOWARDS
E-BANKING WITH SPECIAL REFERENCE TO SBI AND ICICI BANKS
IN THANJAVUR TOWN
Dr.M.SWAMINATHAN S.BELLARMIN DIANA
Research Advisor Research scholar
QUESTIONNAIRE
Please give attention to the following before start answering the questionnaire,
Sir/Madam,
I am a research Scholar doing Research in the field of customer’s satisfaction towards e-
banking. I request you to kindly spend 10-15 minutes in answering the questionnaire, which is
designed to understand your perception, preference, problems and level of satisfaction on your
bank’s e-banking services.
You will be aware of the fact that electronic delivery channels have enabled the banking
organization to redesign and restructure their functioning and acts as a key driver of changes.
Different opinions are expressed about the use of e-banking services. Findings of this report will
help the bank to improve their e-banking services according to your needs and expectations.
This questionnaire has six parts.
Part A captures personal details
Part B captures your e-banking habit and perception
Part C captures your awareness level and preference in relation to e-banking products
and services.
Part D Captures your perception on problems related to e-banking products and services.
Part E captures your satisfaction level with e-banking services of your bank.
xxix
This part has two columns.
Column Column 2
Parameters How do you rate e-banking services of your
bank on the parameters listed in Column 1
E-BANKING FACILITIES
ATM – CUM – Debit Card I II III IV V
Read the question in column2 as
How do you rate e-banking services of your bank on the parameter “E-Banking Facilities” like
services via ATM – cum – Debit Card etc?
The answer is to be recorded in the scale of I to V represented as
I – Excellent, II – Very good III – Just Satisfactory IV - Poor
V – Very Poor
You have to circle the number based on your opinion.
Part F has a blank space for expressing your opinion and suggestion in relation to e-
banking products and services of your bank.
Thanks for your co-operation
S.Bellarmin Diana
Research Scholar,
A.V.V.M. Sri Pushpam College,
Poondi – 613 503.
xxx
PART – A: PERSONAL DETAILS (√) the suitable option
1. Name
2. Age : Less than 30 30 to 40 40 to 50
50 and above
3. Sex : Male Female
4. Educational Qualification : Graduate Post Graduate
Professional Doctorate
Others ……………….. (Pl. specify)
5. Occupation : Businessman Professional
Govt. Employee Private Employee
Retired Person Other
6. Monthly Income : Rupees
Below 15000 15000 to 25000
25000 to 40000 40000 to 60000
Above 60000
7. Marital Status : Married Unmarried
xxxi
PART B : YOUR E – BANKING HABIT AND PERCEPTION
1. Do you have access to e-banking facilities?
Yes No
2. If yes, which of these facilities you are availing from your bank?
ATM – Cum Debit Card ATM Credit Card
Internet Banking Mobile Banking EFT/NEFT
RTGS Electronic Clearing Service (ECS)
Any Branch Banking
3. Motivational factor to avail E-banking products:-
Friends & Relatives Bank Employee
Phone Banking Sales Executives
Advertisement Other Factor
4. For how many years you are utilizing E – banking services?
Less than 1 year 1 to 2 years
2 to 5 years More than 5 years
5. Do you prefer to use electronic delivery channels like ATM, Internet,
Mobile etc. to carry out your banking transactions than going to bank?
Yes No
6. If yes, reason for preference to e-banking products:
Convenience of banking No risk of carrying cash
Global access Time saving
xxxii
Easy Fund Transfer
7. How many times you have done your banking transactions through electronic
delivery channels like ATM, Internet, Mobile etc., in the past, three months?
Zero 1 to 5 times 5 to 15 times
15 to 30 times 30 to 50 times
More than 50 times
8. Do you feel secure with you financial information available and managed through
electronic delivery channels?
Very secure Somewhat secure Not sure
Somewhat insecure Very much insecure
9. “Introduction of electronic delivery channels like ATM, Internet Mobile etc., has
improved the service level of banking”, is it true?
Very true Some what true No sure
Some what untrue Very untrue
10. “Human contact between bank and the client is necessary”, do you agree?
Strongly agree Agree Neither agree not disagree
11. “Electronic Channels like ATM, Internet, Mobile etc., will completely Replace
branches”, do you agree?
Strongly agree Agree Neither agree not disagree
Disagree Strongly disagree
xxxiii
PART C: AWARENESS AND PREFERENCE
(Answer Questions relevant to your e-banking product)
E-BANKING FACILITIES Do you Aware? Do you utilize?
I. ATM-CUM-DEBIT CARD
(i) SERVICES AT ATM
Balance Enquiry ( ) Yes ( ) No ( ) Yes ( ) No
Withdrawal of cash ( ) Yes ( ) No ( ) Yes ( ) No
Deposit of Cash/Cheque/Other Instrument ( ) Yes ( ) No ( ) Yes ( ) No
Obtaining Statement of Account ( ) Yes ( ) No ( ) Yes ( ) No
Cheque book request ( ) Yes ( ) No ( ) Yes ( ) No
Change of PIN ( ) Yes ( ) No ( ) Yes ( ) No
Fund Transfer ( ) Yes ( ) No ( ) Yes ( ) No
Between account in the same branch/bank ( ) Yes ( ) No ( ) Yes ( ) No
Card to card transfer ( ) Yes ( ) No ( ) Yes ( ) No
Card Account Transfer ( ) Yes ( ) No ( ) Yes ( ) No
Fast Cash ( ) Yes ( ) No ( ) Yes ( ) No
Share ATM Facility ( ) Yes ( ) No ( ) Yes ( ) No
Credit Card Bill Payment ( ) Yes ( ) No ( ) Yes ( ) No
Bank’s Insurance Premium Payment ( ) Yes ( ) No ( ) Yes ( ) No
Holy and Trust Donations ( ) Yes ( ) No ( ) Yes ( ) No
Fee payment for educational institution ( ) Yes ( ) No ( ) Yes ( ) No
Mobile Top-ups ( ) Yes ( ) No ( ) Yes ( ) No
Payment for Air Ticket ( ) Yes ( ) No ( ) Yes ( ) No
DEBIT CARD AT POINT OF SALE ( ) Yes ( ) No ( ) Yes ( ) No
Payment for purchase at POS ( ) Yes ( ) No ( ) Yes ( ) No
SMS alert of POS transaction ( ) Yes ( ) No ( ) Yes ( ) No
Cash withdrawal at POS ( ) Yes ( ) No ( ) Yes ( ) No
Attractive Discount ( ) Yes ( ) No ( ) Yes ( ) No
Surcharge Waiver ( ) Yes ( ) No ( ) Yes ( ) No
Reward points ( ) Yes ( ) No ( ) Yes ( ) No
iii. OTHER SERVICES THROUGH
DEBIT CARD
( ) Yes ( ) No ( ) Yes ( ) No
Operate multiple account with single
Debit Card
( ) Yes ( ) No ( ) Yes ( ) No
Personal accident cover ( ) Yes ( ) No ( ) Yes ( ) No
Lost Card Liability cover ( ) Yes ( ) No ( ) Yes ( ) No
Purchase protection ( ) Yes ( ) No ( ) Yes ( ) No
Online Utility Bill Payment ( ) Yes ( ) No ( ) Yes ( ) No
Online purchase ( ) Yes ( ) No ( ) Yes ( ) No
xxxiv
II. INTERNET BANKING
Access Bank Account Information ( ) Yes ( ) No ( ) Yes ( ) No
Bill payment and presentment ( ) Yes ( ) No ( ) Yes ( ) No
Bank a/c statement by e-mail ( ) Yes ( ) No ( ) Yes ( ) No
Fund Transfer
Internet Branch Fund Transfer
(between own a/c)
( ) Yes ( ) No ( ) Yes ( ) No
Inter Branch Fund Transfer
(to third party a/c)
( ) Yes ( ) No ( ) Yes ( ) No
Transfer to any bank a/c ( ) Yes ( ) No ( ) Yes ( ) No
RTGS Payment Instruction ( ) Yes ( ) No ( ) Yes ( ) No
Linking of Accounts
Linking bank a/c and Credit Card a/c ( ) Yes ( ) No ( ) Yes ( ) No
Linking bank a.c and Demat a/c ( ) Yes ( ) No ( ) Yes ( ) No
Access Credit Card details ( ) Yes ( ) No ( ) Yes ( ) No
Credit Card related service request ( ) Yes ( ) No ( ) Yes ( ) No
Access Demat account details ( ) Yes ( ) No ( ) Yes ( ) No
Subscribe alert on Mobile phone ( ) Yes ( ) No ( ) Yes ( ) No
Service Request
Apply for Debit Card ( ) Yes ( ) No ( ) Yes ( ) No
Intimate about loss of ATM Card ( ) Yes ( ) No ( ) Yes ( ) No
Opening Deposit Account ( ) Yes ( ) No ( ) Yes ( ) No
Cheque status enquiry ( ) Yes ( ) No ( ) Yes ( ) No
Apply for Phone banking ( ) Yes ( ) No ( ) Yes ( ) No
Apply for bank products ( ) Yes ( ) No ( ) Yes ( ) No
Online Air ticket booking ( ) Yes ( ) No ( ) Yes ( ) No
Online Railway ticket booking ( ) Yes ( ) No ( ) Yes ( ) No
Income, Service & Excise Duty Payment ( ) Yes ( ) No ( ) Yes ( ) No
Online Custom Duty Payment ( ) Yes ( ) No ( ) Yes ( ) No
Online Shopping ( ) Yes ( ) No ( ) Yes ( ) No
III. MOBILEW BANKING ( ) Yes ( ) No ( ) Yes ( ) No
Balance enquiry ( ) Yes ( ) No ( ) Yes ( ) No
Last 5 transaction details ( ) Yes ( ) No ( ) Yes ( ) No
Cheque book request ( ) Yes ( ) No ( ) Yes ( ) No
Cheque status enquiry ( ) Yes ( ) No ( ) Yes ( ) No
Stop cheque request ( ) Yes ( ) No ( ) Yes ( ) No
Bill Payment ( ) Yes ( ) No ( ) Yes ( ) No
Fund Transfer ( ) Yes ( ) No ( ) Yes ( ) No
Get Credit Card account Details ( ) Yes ( ) No ( ) Yes ( ) No
Get Demat account details ( ) Yes ( ) No ( ) Yes ( ) No
Loan account details ( ) Yes ( ) No ( ) Yes ( ) No
Locate Branch/ATM ( ) Yes ( ) No ( ) Yes ( ) No
Prepaid Mobile Recharge ( ) Yes ( ) No ( ) Yes ( ) No
Apply for Bank products ( ) Yes ( ) No ( ) Yes ( ) No
Status of service request raised ( ) Yes ( ) No ( ) Yes ( ) No
xxxv
IV. CREDIT CARD
Cash withdrawal facility at ATM ( ) Yes ( ) No ( ) Yes ( ) No
Cash advance at cash point ( ) Yes ( ) No ( ) Yes ( ) No
Online shopping ( ) Yes ( ) No ( ) Yes ( ) No
Online Railway Ticket Booking ( ) Yes ( ) No ( ) Yes ( ) No
E-Statement ( ) Yes ( ) No ( ) Yes ( ) No
SMS alert ( ) Yes ( ) No ( ) Yes ( ) No
Utility bill payment ( ) Yes ( ) No ( ) Yes ( ) No
Balance Transfer facility ( ) Yes ( ) No ( ) Yes ( ) No
Online Management of Card Account ( ) Yes ( ) No ( ) Yes ( ) No
Auto Debit Facility ( ) Yes ( ) No ( ) Yes ( ) No
Payment Option
Cash/Cheque/Draft ( ) Yes ( ) No ( ) Yes ( ) No
Payment through ATM ( ) Yes ( ) No ( ) Yes ( ) No
Payment through ECS
Drop box facility ( ) Yes ( ) No ( ) Yes ( ) No
Dial-a-Draft facility ( ) Yes ( ) No ( ) Yes ( ) No
Personal Loan on Card ( ) Yes ( ) No ( ) Yes ( ) No
Interest free Credit card ( ) Yes ( ) No ( ) Yes ( ) No
Add on card facility ( ) Yes ( ) No ( ) Yes ( ) No
Temporary Credit limit enhancement ( ) Yes ( ) No ( ) Yes ( ) No
Permanent Credit limit enhancement ( ) Yes ( ) No ( ) Yes ( ) No
Selfset/monthly preset limit ( ) Yes ( ) No ( ) Yes ( ) No
Limited lost card liability ( ) Yes ( ) No ( ) Yes ( ) No
Revolving Credit facility ( ) Yes ( ) No ( ) Yes ( ) No
Cash back offer ( ) Yes ( ) No ( ) Yes ( ) No
Discount ( ) Yes ( ) No ( ) Yes ( ) No
Reward point ( ) Yes ( ) No ( ) Yes ( ) No
Fuel Surcharge Waiver ( ) Yes ( ) No ( ) Yes ( ) No
Personal accident cover ( ) Yes ( ) No ( ) Yes ( ) No
Credit Shield Cover ( ) Yes ( ) No ( ) Yes ( ) No
Life Insurance on card holder ( ) Yes ( ) No ( ) Yes ( ) No
Life Insurance on add on card holder ( ) Yes ( ) No ( ) Yes ( ) No
Purchase protection ( ) Yes ( ) No ( ) Yes ( ) No
V.ANY BRANCH BANKING ( ) Yes ( ) No ( ) Yes ( ) No
Deposit of cash at non-home branch ( ) Yes ( ) No ( ) Yes ( ) No
Deposit of cheque& clearing instrument ( ) Yes ( ) No ( ) Yes ( ) No
Cash withdrawal at non-home branch ( ) Yes ( ) No ( ) Yes ( ) No
Balance enquiry at non-home branch ( ) Yes ( ) No ( ) Yes ( ) No
Get statement of account at non-home
branch
( ) Yes ( ) No ( ) Yes ( ) No
Passbook updation ( ) Yes ( ) No ( ) Yes ( ) No
Fund Transfer from home branch to third
party a/c at another CBS branch
( ) Yes ( ) No ( ) Yes ( ) No
xxxvi
PART D : YOUR PERCEPTION ON PROBLEMS
(Answer Relevant Questions only)
1. Electronic banking has increased the gap between bank and the Customer?
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
2. Difficulty in interacting with bank for grievances
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
3. Helpline waiting time in long
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
4. The 24 hours helpline of the bank is not of any help when any dispute arises
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
5. Misleading advertisement and promotion literature on banking products and
services.
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
6. Lack of explicit permission from customers for sharing information about them
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
xxxvii
7. Lack of proper compensation as per compensation policy
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
8. Without prior notification changes in the schedule of charges, terms and
conditions.
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
9. Service charges and annual maintenance changes are high with regard to e-
banking facilities.
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
10. Delay in correcting mistakes and cancelling any bank charges
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
11. Risk is the major constrain for e-banking customers
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
12. Technology used for the safety of e-banking transaction is not up to the mark
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
13. Insufficient consumer education of fraud prevention and detection
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
xxxviii
I. ATM related Problems:
14. ATM Centres are insufficient
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
15. ATM Centres are not in prominent place
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
16. In sufficient Cash balance at ATM centres
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
17. Lack of connectivity with more and more bank’s ATM through shared ATM
network
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
18. Amount allowed to be drawn from ATM per day is very low
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
19. “Account debited but cash not dispensed” is a frequent problem
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
xxxix
20. Card blocking is very frequent
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
21. Safety situation around ATM is not satisfactory
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
22. High service charge for cash withdrawal at shared and other banks ATM.
Strongly agree Agree Neither agree not disagree
a. Disagree Strong disagree
23. Heavy charges for fund transfer through VISA money transfer and money send
option
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
II. Credit Card related Problems
24. Hidden charges and basis of applying interest is not made known to the customer
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
25. Unwarranted Overdraft has been allowed by banks without the consent of the
customer
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
xl
26. Unannounced slashing of credit limit
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
27. Issue of credit card without asking customer
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
28. New Cards being incepted and misused by unscrupulous elements before they
reach customers
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
29. Banks are in the dock of using strong arm tactics to recover dues
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
30. Difficulty in closure and blocking of lost and
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
31. Difficulty in returning the cards issued
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
32. Charges for things that customer did not buy
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
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33. Debiting the card account twice
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
34. Drop boxes are not sufficient
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
35. Credit limit fixed is low
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
36. Delay in issuing new cards in the place of lost card
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
37. Delay in sending monthly statement of account
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
38. Error in statement of account
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
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39. Delay in sending Duplicate statement of account
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
40. Providing clients unbelievable credit limit without any reason
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
41. The reason for rejecting card application is not at all communicated to the
applicant
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
42. Sharing card holder’s information with any of its group companies subsidiaries or
affiliates etc.
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
43. Receiving unwanted calls from agents of sundry banker offering Financial product
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
44. Receiving calls about payment outstanding even after payment made
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
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45. There remains some risk of giving card number when buying online
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
46. Products purchased through card are costlier
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
47. Some merchants hesitate to accept credit card
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
48. Merchant establishments charge heavy transaction cost
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
49. Merchant establishments are not displaying statement ‘credit card accepted”
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
50. Cash back offer and reward points are not much rewarding
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
51. Usurious interest charges on outstanding
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
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52. Heavy fee on late payment
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
53. Higher charges on over limit credit
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
54. Heavy charges for cash withdrawal at ATM
Strongly agree Agree Neither agree not disagree
a. Disagree Strong disagree
55. Finance charges are very high on extended credit and cash advance
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
56. Foreign currency transaction fee is high
Strongly agree Agree Neither agree not disagree
a. Disagree Strong disagree
57. Surcharge on railway ticket reservation and petrol filling is high
Strongly agree Agree Neither agree not disagree
a. Disagree Strong disagree
58. Cheque collection charges are high
Strongly agree Agree Neither agree not disagree
a. Disagree Strong disagree
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59. High outstation cheque processing fee
Strongly agree Agree Neither agree not disagree
a. Disagree Strong disagree
60. Replacement card fee is high
Strongly agree Agree Neither agree not disagree
a. Disagree Strong disagree
61. Statement retrieval fee is high
Strongly agree Agree Neither agree not disagree
a. Disagree Strong disagree
62. Changing late payment fee for a short payment of few paise
Strongly agree Agree Neither agree not disagree
a. Disagree Strong disagree
III. Debit card related problems
63. Delay in giving final resolution for disputed transaction
Strongly agree Agree Neither agree not disagree
a. Disagree Strong disagree
64. Cancellation or blocking of a card after the card is lost or stolen takes more time
Strongly agree Agree Neither agree not disagree
a. Disagree Strong disagree
65. Cancellation of debit card without assigning any reason by banks
Strongly agree Agree Neither agree not disagree
a. Disagree Strong disagree
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66. Debiting card holder’s account twice
Strongly agree Agree Neither agree not disagree
a. Disagree Strong disagree
67. It takes more than a month to get back the money that is wrongly debited.
Strongly agree Agree Neither agree not disagree
a. Disagree Strong disagree
68. Getting an ATM Cum debit Card is a time consuming process
Strongly agree Agree Neither agree not disagree
a. Disagree Strong disagree
69. Using a debit card for online purchase is risky
Strongly agree Agree Neither agree not disagree
a. Disagree Strong disagree
70. Charges for issuing replacement card is high
Strongly agree Agree Neither agree not disagree
a. Disagree Strong disagree
IV. Net Banking related problems
71. The information on bank’s website are not current and updated
Strongly agree Agree Neither agree not disagree
a. Disagree Strong disagree
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72. The websites are more bank-centric and less customer – centric
Strongly agree Agree Neither agree not disagree
a. Disagree Strong disagree
73. The websites are not telling how a particulars product or scheme is beneficial or
profitable for a customer
Strongly agree Agree Neither agree not disagree
a. Disagree Strong disagree
74. Difficulty in identifying the authenticity of bank’s e-mail
Strongly agree Agree Neither agree not disagree
a. Disagree Strong disagree
75. Difficulty in identifying the difference between the bank’s website and spoof
website
Strongly agree Agree Neither agree not disagree
a. Disagree Strong disagree
76. Delay in getting back the amount after cancellation of train ticket booked through
net banking
Strongly agree Agree Neither agree not disagree
a. Disagree Strong disagree
77. Online air ticket booking through merchant side involves heavy fee
Strongly agree Agree Neither agree not disagree
a. Disagree Strong disagree
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78. Fund transfer to any other bank’s account through net banking is available in
selected banks in selected cities
Strongly agree Agree Neither agree not disagree
a. Disagree Strong disagree
IV. Mobile banking related problems
79. The permissible amount of financial transaction per day using mobile banking is
low
Strongly agree Agree Neither agree not disagree
a. Disagree Strong disagree
80. The SMS alerts on credit or debit transaction is only for higher value transaction
Strongly agree Agree Neither agree not disagree
a. Disagree Strong disagree
81. Financial transactions are only possible in iphone
Strongly agree Agree Neither agree not disagree
a. Disagree Strong disagree
VI. RTGS, NEFT, ECS related problems
82. RTGS and NEFT is enabled only in specific branches across India
Strongly agree Agree Neither agree not disagree
a. Disagree Strong disagree
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83. Non-credit or delay in credit to the beneficiary account in case of NEFT
transactions.
Strongly agree Agree Neither agree not disagree
a. Disagree Strong disagree
84. As a sponsor bank of ECS debit and credit, bank collects heavy charges
Strongly agree Agree Neither agree not disagree
a. Disagree Strong disagree
VII. Any Branch Banking
85. The permissible amount of deposit through any branch banking is very low
Strongly agree Agree Neither agree not disagree
a. Disagree Strong disagree
86. The permissible amount of withdrawal is low
Strongly agree Agree Neither agree not disagree
a. Disagree Strong disagree
87. Huge charges for deposit of intercity cheques and clearing instrument at non-home
branch
Strongly agree Agree Neither agree not disagree
a. Disagree Strong disagree
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88. Heavy Service Charges for inter city fund transfer to third party account at another
CBS branch
Strongly agree Agree Neither agree not disagree
a. Disagree Strong disagree
VIII. Problems related to fraud
89. Skimmers and cameras used by fraudsters to collect card information
Strongly agree Agree Neither agree not disagree
Disagree Strong disagree
90. Phishing e-mails from fraudsters, seeking information on card account, password
and pose as a trustworthy source
Strongly agree Agree Neither agree not disagree
a. Disagree Strong disagree
91. Fake calls to wheedle out financial information
Strongly agree Agree Neither agree not disagree
a. Disagree Strong disagree
92. The chances of capturing credit card number and its expiry date through charge
slip by fraudster is very high
Strongly agree Agree Neither agree not disagree
a. Disagree Strong disagree
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93. Photo copies of cards are used by fraudsters to make online purchase
Strongly agree Agree Neither agree not disagree
a. Disagree Strong disagree
94. Unsolicited Credit card applications raise the chances of risk.
Strongly agree Agree Neither agree not disagree
a. Disagree Strong disagree
95. Unauthorized person or hacker traps data travelling across the network.
Strongly agree Agree Neither agree not disagree
a. Disagree Strong disagree
96. Confidential information provided by card users to the concerned website for
making online purchases are hacked by internet fraudsters.
Strongly agree Agree Neither agree not disagree
a. Disagree Strong disagree
97. Through cookies in the website fraudsters collect confidential information
Strongly agree Agree Neither agree not disagree
a. Disagree Strong disagree
98. The amount of malicious or malware software designed to steal password grows
exponentially
Strongly agree Agree Neither agree not disagree
a. Disagree Strong disagree
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99. The risk of existence of malware program in an undesirable website or an e-mail
from an unknown source is very high
Strongly agree Agree Neither agree not disagree
a. Disagree Strong disagree
100. Cyber attackers sent Viruses through free trial offer of software and services
Strongly agree Agree Neither agree not disagree
b. Disagree Strong disagree
1. Have you come across any problem personally?
Yes No
2. Have you contacted your bank for complaining about your problem?
Yes No
3. If no, reason for not making complaint
Failure of previous effort Busy with work
Automatic rectifications Other reason
4. If yes, how you approached the bank?
Through Helpline Internet Other
5. Number of times complaint made by you,
Less than 3 times 3 to 6 times More than 6 times
6. Whether the bank helped to solve the problem at your satisfaction
Yes No
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7. If yes, whether appropriate redressal of your complaint is made within
stipulated period.
Yes No
8. Time taken to solve the problem
within a day within a week more than a week
9. Did you face the same problem again and again?
Yes No
10. Your level of satisfaction towards complaint handling of your bank
High satisfied Satisfied neither satisfied nor
Dissatisfied
Dissatisfied Highly dissatisfied
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PART E: SATISFACTION LEVEL WITH E-BANKING PRODUCTS AND
SERVICES
Column I lists the parameters
Number in Column 2 represents the answer to the question “How do you rate e-banking
services of your bank?” on the parameters listed in Column 2.
Circle the number based on your opinion in the scale
I – Excellent, II – very good, III – Just satisfactory, IV – Poor, V-very poor
Column I Column 2
Parameters
How do you rate e-banking services of
your bank on the parameters listed in
Column 1
A. E-BANKING FACILITIES I II III IV V
ATM – cum – debit card I II III IV V
ATM Services I II III IV V
Credit Card I II III IV V
Internet Banking I II III IV V
Mobile Banking I II III IV V
RTGs I II III IV V
EFT/NEFT I II III IV V
Electronic Clearing Service (ECS) I II III IV V
Any branch banking I II III IV V
B QUALITY OF SERVICE
Accuracy/Absence of error I II III IV V
Confidentiality I II III IV V
Good complaint handling I II III IV V
Clear communication between bank and the
customer
I II III IV V
No break-down of machines/services I II III IV V
Prompt response to customer request I II III IV V
Easy connectivity I II III IV V
Adoption of user friendly technology I II III IV V
Connectivity with other banks I II III IV V
Secured transaction I II III IV V
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Part F :
Please write your opinion – both positive and negative about e-banking services
offered by your bank, your expectations about services and also your suggestions for
improvements etc.