Model Project 6

“CUSTOMER SATISFACTION ON INTERNET BANKING SERVICE
QUALITY”
A PROJECT REPORT SUBMITTED TO THE UNIVERSITY OF CALICUT IN

PARTIAL FULFILMENT OF THE REQUIREMENT FOR THE AWARD OF THE
DEGREE OF MASTER OF COMMERCE.
SUBMITED BY,
RATHEESH K K
(CHANMCM009)
UNDER THE SUPERVISION AND GUIDANCE OF
SRI. PRADEESH. K
ASSISTANT PROFESSOR OF COMMERCE
POST GRADUATE DEPT. OF COMMERCE
GOVERNMENT COLLEGE, CHITTUR
JULY 2015
1
DECLARATION
I RATHEESH K K hereby declare that the project report titled “CUSTOMER

SATISFACTION ON INTERNET BANKING SERVICE QUALITY” is a bonafide work
done by me and is submitted to the university of Calicut in partial fulfillment of the
requirements for the award of the degree of Master of commerce. I also declare that the
report has not been submitted by me for the award of degree, diploma or other similar title of
any university.
2
GOVERNMENT COLLEGE, CHITTUR
POST GRADUATE DEPARTMENT OF COMMERCE
CERTIFICATE
Certificate that is bonafide work carried out by RATHEESH K K is submitted
to the University of Calicut in partial fulfillment of the requirements for the award
of the degree of Master of Commerce.
Place: Signature
Date: Name and designation of
Supervising teacher
Counter signed by
Place: Signature of the
Date : Head of the Department
3
POST GRADUATE DEPARTMENT OF COMMERCE
GOVERNMENT COLLEGE, CHITTUR, PALAKKAD KERALA-678104
(AFFILIATED TO CALICUT UNIVERSITY)
CERTIFICATE
Certified that RATHEESH K K 4thsemester M.COM student in this department has worked
on the project titled “CUSTOMER SATISFACTION ON INTERNET BANKING
SERVICE QUALITY.” for a period of 21 days from the 2nd week of April 2015 under my
supervision and guidance. This has not been previously submitted for the award of any
degree, diploma or other similar title. This project is with submitting for the Degree of Master
of Commerce.
Place: Signature
Date: Name& Designation of Supervising Teacher
4
ACKNOWLEDGEMENT
Every study is a learn more. It is essentially a pursuit in solitude. However, there

cannot be any action yielding results without help of others. There are many I thank in
the successful completion of this project.
First and foremost, I thank almighty God for his blessings in the successful
completion of this project.
I acknowledge my sincere and profound gratitude to our Smt. C.A.VISHALAKSHI,

Head of department of commerce, Govt. College Chittur, and other teachers of the
department for the advice and inspiration given.
I am extremely grateful to my supervising teacher Sri PRADEESH.K, Asst. Prof. of

department of commerce, Govt. College Chittur for the valuable guidance, supervision
and encouragement with enabled me to complete this project.
I express my deepest sense of gratitude to Dr. LAKSHMANAN M.P, Asst. Prof. of

department of commerce, Govt. College Chittur for his enormous help, invaluable
ideas and knowledge, advice, encouragement for the successfully completion of my
research work.
I would like to express my great thanks to all the respondents for their invaluable
support in the field work.
I convey my sincere thanks to my family and my friends for all their helps, support
and encouragement for this study.
This list is almost incomplete and I am grateful to all those who have helped me
directly and indirectly in my research work.
Place:
Date: RATHEESH K K
5
CONTENTS
SL NO PARTICULARS PAGE NO
CHAPTER 1
1 8 – 14
INDRODUCTION
CHAPTER 2
2 REVIWE OF LITRATURE 15 – 22
CHAPTER 3
3 THEORETICAL FRAMWORK 23 – 37
CHAPTER 4
4 38 – 54
ANALYSIS AND INTERPRETATION
CHAPTER 5
5 FINDINGS,SUGGESTIONS AND 55 – 60
CONCLUSIONS
6 BIBLIOGRAPHY AND APPENDIX 61 – 64
6
LIST OF TABLES
TABLE PAGE
TABLE NAME
NO. NO.
4.1.1 Demographic profile of respondents 40
4.2.1 Mean ranks Obtained for the reason behind in using IB services 41
4.2.2 Friedman Test 42
4.3.1.1 Gender wise Estimated Marginal Means- Transaction Efficiency 42
4.3.1.2 Education Qualification wise Estimated Marginal Means- TE 42
4.3.1.3 Two-Way ANOVA – TE 43
4.3.2.1 Gender wise Estimated Marginal Means- Reliability 43
Education Qualification wise Estimated Marginal Means-
4.3.2.2 44
Reliability
4.3.2.3 Two-Way ANOVA – Reliability 44
4.3.3.1 Gender wise Estimated Marginal Means- Service Content 45
4.3.3.2 Education Qualification wise Estimated Marginal Means- SC 45
4.3.3.3 Two-Way ANOVA – SC 45
4.3.4.1 Gender wise Estimated Marginal Means- Customer Support 46
4.3.4.2 Education Qualification wise Estimated Marginal Means- CS 46
4.3.4.3 Two-Way ANOVA – CS 47
4.3.5.1 Gender wise Estimated Marginal Means- Ease of Use 47
4.3.5.2 Education Qualification wise Estimated Marginal Means- EU 48
4.3.5.3 Two-Way ANOVA – EU 48
4.3.6.1 Gender wise Estimated Marginal Means- Safety and Security 49
4.3.6.2 Education Qualification wise Estimated Marginal Means- SS 49
4.3.6.3 Two-Way ANOVA – SS 49
Mean ranks obtained for the problems faced by the IB Service
4.4.1 51
Users
4.4.2 Friedman Test 51
Education Qualification-wise mean ranks on Security Features of
4.5.1 52
IB services
4.5.2 Kruskal Wallis Test 54
7
CHAPTER 1
INTRODUCTION
8
INTRODUCTION
Banking sector plays a significant role in the development of an economy. The advent of
Information Technology (IT) and its convergence with communication technology have
drastically changed the landscape of banking services across the globe. Over the past few
decades, banks all over the world have been investing substantial amounts of money in IT
with the avowed objectives of improving operational efficiency, competitive position and
product innovation. The use of IT in the banking sector has contributed to the emergence of
more flexible and user friendly Self Service Banking Technologies (SSBT) to address the
rapid and changing needs of banking customers. It has changed the face of global banking
sector radically altering the manner in which customers conduct their banking transactions.
Indian banking sector too has followed the same path and the gap between Indian banks and
their counterparties in the technology advanced countries is vanishing.
The banking sector reforms initiated in India in the early 1990s revitalized the banking sector.
The private and foreign banks brought new technologies and rendered technology-based
world class quality services to customers through ATMs, credit cards, Internet Banking,
Mobile Banking. World class quality service in banking was mirage to Indian customers and
the service of private and foreign banks was a delight for them. They received wide patronage
from younger generations and emerging entrepreneurs. Gradually, these tech-savy banks
started snatching customers from public sector banks and they felt the heat and realized that if
they do not follow the path of these banks, they would be thrown out from the banking scene
within no time. Thus, the entry of new generation tech-savy banks has resulted in a paradigm
shift in the ways of banking in India and paved the way for extensive use of IT in the banking
sector.
The beginning of empowerment of banking customers for their own transactions started with
the evolution of ATMs as a delivery channel. The emergence of Self Service Banking
technologies (SSBT) such as ATM, Internet Banking, and mobile Banking ushered the
concept of anytime and anywhere banking. With the advent of internet, it becomes easy for
banks to share the databases and maintain a centralized database at a low cost. Internet
facilitated banks to create their own web pages through the web browsers even while sitting
at home. This kicked off Internet Banking way back in 1996.
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Internet Banking refers to systems that enable bank customer to get access to their accounts
and general information on bank products and services through the use of bank’s website,
without the intervention or inconvenience of sending letters, faxes, original signatures,
telephone confirmations. Pikkarainen et al., (2004) defines Internet Banking as an “Internet
portal, through which customers can use different kinds of banking services ranging from bill
payment to making investments”. Thus Internet Banking is the use of internet by banking
customers for transacting their banking transactions. In other words, it is the use of internet
by bank to deliver banking services to customers irrespective of their geographical location. It
is the delivery of traditional ‘brick and mortar’ banking services via non personal
communication channel, viz., internet. The cost handling a banking transaction at a traditional
branch is estimated to be 100 times higher than on the internet, so Internet Banking will soon
expand. The main advantage of IB for banks is that the cost per transaction is even lower than
those of an ATM. This is primarily because Internet banking as a delivery channel does not
require physical infrastructure, thus saving on prohibitive real estate costs. Thus, banks are
trying to get customers to switch over to this mode of banking.
Customer Satisfaction
Customers are the king of market and customer satisfaction becomes a major area of
marketing. Satisfaction is a person’s feeling of pleasure or disappointment resulting from
comparing a product performance (outcome) in relation to his or her expectations. Customer
satisfaction has been recognized as an important element that drives customer retention,
loyalty and post-purchase behavior of customers. It is well documented that the measurement
of customer satisfaction regarding the service quality of firms is a necessary means by which
organizations delve into the minds of its customer for useful feedback that could form the
basis for effective marketing strategy.
Banks today know better than anyone the opportunities and the risks they face in an ever
changing competitive environment. In offering e-commerce products, banks some key
advantage over potential competitors. E-commerce would create opportunities for banks to
strengthen their relationship with customers. The main purpose of the study is to gain better
understanding of the customer satisfaction measurement of Internet Banking Service facilities
users.
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STATEMENT OF PROBLEM
Customer satisfaction is a complicated mix of “hardware” (technology, product, price, quality
etc.) and “software” (attitude, responsiveness, deliverance, communication etc.). Today’s
customers are not satisfied with care and courtesy alone, they expect concern and
commitment. In this competition environment not the oldest, not the strongest and not the
first can survive, but only the “best” can survive.
The success of Internet Banking not only depends on the technology but also on the large
extend the attitude, commitment and involvement of the operating at all levels and how far
the customers reap the benefits from Internet banking services. It is crucial for banks that
offer IB services to periodically and consistently measure the satisfaction of their customers.
The purpose of this study is to examine the customer satisfaction with various service quality
dimensions.
OBJECTIVES
1) To identify the factors affecting customer satisfaction on Internet Banking service

quality
2) To evaluate the satisfaction level of Internet Banking users.
3) To examine the major problems faced by users while using Internet Banking services
4) To identify the level of trust and awareness level on the security features of Internet
Banking
SIGNIFICANCE OF THE STUDY
Internet has established its role as a powerful economic force multiplier with a new study
projecting that its contribution to India’s GDP will explode to $100 billion (Rs 5 lakh crore)
by 2016. The increasing usage of internet in Kerala is evident from the fact in the previous
years. People of Kerala are becoming e-literate through ‘Akshaya’ project undertaken by
Govt. of Kerala in 2005, which imparts training to one person from one family to make
people aware of the basics and scope of IT, hands-on-skill in operating a computer and use of
internet. Both availability of access to internet and e-literacy are essential prerequisites for the
adoption of internet banking. More access to computers and the internet, the greater is the
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possibility of the use of internet banking. Similarly, the more people are becoming e-literate,
the more is the possibility of doing internet banking.
At present, public utility service providers are encouraging their customers to make payment
of their utility bills online. It is hoped that just as ATMs saw a period of inaction before they
were accepted by Indian masses, Internet Banking too would be accepted once customers
realize the possibilities and potentials of IB. However, research studies indicate that
customers’ security and risk concerns are the major inhibitors to the adoption of IB. therefore,
in order to ally the apprehensions of customers about the risk associated with the use of IB,
the providers need to educate and enlighten customers regarding the safe use of IB by asking
them to take the required precautions.
In the wake of the above, it is an opportune time to conduct a customer centric study on IB. A
review of literature revealed that a number of studies have been carried out in India and
abroad in relation to adoption, rationales and benefits of IB. However, a comprehensive
research investigating the extent of IB use, precautions taken by IB users for safe banking
over internet, awareness and trust of customers on the security features adopted by banks to
guard them against the risk of fraud, the service quality dimensions and their effect on
customer satisfaction, problems encountered by IB users during service delivery etc. Hence,
the present study is quite relevant and timely from the point of view of both academic and
banking industry.
RESEARCH METHODOLOGY
Research methodology refers to the theoretical analysis of the methods appropriate to a field
of study or to the body of methods and principles particular to a branch of knowledge.
Data sources
The study makes use of primary and secondary data. The primary data is collected from the
IB users through a structured questionnaire. Secondary data collected from various sources
like Articles, websites, Lecture books etc
Period of study
The study is conducted for a period of 21 days from 2nd week of April 2015.
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Research Instrument
A well-structured questionnaire was prepared with a view to collect information from Internet
banking Users. The questionnaire consists four parts.
1. Demographic Profile of Respondents

2. IB service Quality Dimensions
3. Problems faced by IB Users
4. Security Features available in IB
Population
Population comprises all the customers who were using Internet Banking Services in
Palakkad.
Sample size
Due to the limited period of study, only 100 customers selected as sample unit from the
population. The study is conducted on the basis of the responds of the selected sample and
findings are drawn based on their responds.
Method of sampling
Random Sampling Method is used for selecting the Sample Unit.
Type of analysis
Bi-variable analysis was done for establishing relationship among the variables under study.
Tools used for analysis
1. Friedman Test
The Friedman test is a non-parametric statistical test developed by the U.S economist Milton
Friedman. Similar to the parametric repeated measures ANOVA, it is used to detect
differences in treatments across multiple test attempts. The procedure involves ranking each
row (or block) together, then considering the values of ranks by columns. Applicable to
complete block designs, it is thus a special case of the Durbin Test.
In this study, it is used for testing the variation of the rank preference of the customers
towards the reason for using IB and the problems faced by IB users.
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2. Two-way ANOVA
In statistics, the two-way analysis of variance (ANOVA) is an extension of the one-way

ANOVA that examines the influence of two different categorical independent variables on
one continuous dependent variable. The two-way ANOVA not only aims at assessing the
main effects of each independent variable but also if there is any interaction between them.
In this study, two-way ANOVA is used to test the gender and Education Qualification wise
Satisfaction of customers on the IB service quality.
3. Kruskal-Wallis Test
The Kruskal-Wallis one-way ANOVA by ranks (named after William Kruskal and W. Allen
Wallis) is a non-parametric method for testing whether samples originate from the same
distribution. It is used for comparing two or more samples that are independent, and that may
have different sample sizes and extends the Mann-Whitney test to more than two groups. The
parametric equivalent of the Kruskal-Wallis test is the one-way ANOVA.
Here, the test is used to test the mean rank preference of users by Education Qualification
wise as to their level of trust on security features available in IB.
LIMITATIONS OF THE STUDY
1. Selected Sample is limited to 100. Hence findings cannot be generalized.

2. Respondents may be biased. So the collected data may not be reliable
3. Customers’ preferences and opinions are supposed to change from time to time
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CHAPTER 2
LITERATURE REVIEW
15
Introduction:
Generally, a researcher conducts and surveys the related literature in order to review the
present status of a particular research topic. From the survey of literature, a researcher is able
to know the quantum of work already done on his research topic so far not touched, or yet to
be undertaken. The overview of literature at the national or an international level is to be
researched with the help of research reports, articles, books and other materials.
The major benefits of literature reviews are: firstly, helps the researcher in avoiding
duplication of efforts on the same research topic. Secondly, helps the researcher in adopting
methodologies used successfully by other researchers, writers and policy makers. Thirdly,
suggests new approaches in planning, organizing the investigation of research topic. Fourthly,
helps to narrow down the research problem more clearly and sixthly, assists investigators to
develop firm understandings of theoretical implications of proposed inquiries.
This study contributes to literature by focusing on the measurement of Customer Satisfaction
of Internet Banking in Western India. The aim of literature reviews is to justify, rationale of
an ensuring research study, provides an overview of historical perspectives and to bring to the
light the research trends and problems.
Rahmath Safeena et al(2011) found that banks need to highlight the benefits of IB, make IB
easy to use, and enhance IB security to improve consumers’ trust. They also need to make the
consumers aware about the system by providing them about the details of the benefits
associated with it and also ensuring security of the system. Banks can highlight benefits such
as IB conveniences in their promotional and advertising activities. The IB interface could be
made simple. Banks also need to engage in security enhancement activities such as
encryption, firewall, and user protection and authenticity.
Trust is one of the more influential factors, implying that controlling the risk of online
banking is more important than providing benefits. This finding is particularly important for
managers as they decide how to allocate resources to retain and expand their current customer
base. However, building a risk free online transaction environment is much more difficult
than providing benefits to customers.
Therefore, online banking companies need to search for risk-reducing strategies that might
assist in inspiring high confidence in potential customers. This study suggests that they
should consider focusing on the prevention of intrusion, fraud and identity theft. In addition,
this study suggests that online banking companies could develop trust-building mechanisms
16
to attract customers, such as statements of guarantee, increased familiarity through
advertising, and long-term customer service. The proposed model makes an important
contribution to the emerging literature on e-commerce, especially with regard to online
banking.
Dixit N. & Datta S.K., (2010) in their study, they found that country like India, there is need
for providing better and customized services to the customers. Banks must be concerned the
attitudes of adult customers with regard to acceptance of online banking. It is shows that adult
customers are more reluctant to join new technologies or methods that might contain little
risk. It’s also important to note that some adult customers are interested in online banking;
however, they do not possess the necessary computer literacy to conduct it. In addition banks
should design the website to concern security and privacy issues. The recommendations to
the banks are that they have to increase the level of trust between banks’ website and
customers. Because customer perception on security and privacy aspect have been seen in the
literature. The importance of security and privacy for the acceptance of internet banking has
been noted in many banks study and found that people have weak understanding of internet
banking, although they are aware about risk. Banks noted that although consumer confidence
in their bank was strong yet their confidence in the technology was weak through many
studies. It is clear those adult customers are ready to adopt online banking if banks take
necessary action. There are following strategies should be applied by banks. Banks should
ensure that online banking is safe and secure for financial transaction like as traditional
banking, Banks should organize seminar and conference to educate the customer regarding
uses of online banking as well as security and privacy of their accounts, Some elder
customers are hindered by lack of computer skills. They need to be educated on basic skills
required to conduct online banking,
Banks must emphasize the convenience that online banking can provide to elder people, such
as avoiding long queue, in order to motivate them to use it, Banks must emphasize the cost
saving that online can provide to the elder people, such as reduce transaction cost by use of
online banking. Adult customer always prefers advanced technology but sometimes lack of
knowledge they are unable to access such technologies. The fact that people have positive
perceptions about online banking should be treated with great value. This is because one bad
experience can result in customer discontinuation of the E-banking service (Jun & Cai, 2001).
17
Rod Michel et al (2009), Their outcome presented a model to explain how three dimensions
of internet banking service quality influence perceptions of overall internet banking service
quality, and how these overall perceptions of internet service quality influence customers’
satisfaction. All hypotheses were confirmed albeit with H3 marginally. Our results suggest
that online information system quality is a significantly stronger predictor of overall internet
banking service quality than both online customer service quality and banking service
product quality individually and when combined. The significant relationship between online
customer service quality and overall internet banking service quality indicates that the quality
of customer service is important for banks in the context of internet banking. Even in the
absence of face-to-face interactions, reliability, responsiveness, tangibles and empathy are
still important to customers. These dimensions directly affect customer perceptions of overall
internet banking service quality which influences overall customer satisfaction with the bank.
Online information system quality is also significantly related to overall internet banking
service quality perceptions. A high-performance information system enables customers to
conduct banking transactions on their own through the computer system. Without direct
interaction with bank staff, ease of use, accuracy, security, timeliness, contents and aesthetics
are critical to enhancing customer perception of overall internet banking service quality. The
strong positive association between overall internet banking service quality and customer
satisfaction suggests that when overall internet banking service quality is perceived to be
high, customers are more likely to be satisfied with their online service and consequently will
be more satisfied with their bank. Overall, the contribution that this research makes is in
examining five relevant and important constructs in one model. The research findings suggest
a number of implications for online banking services management. This includes the need for
managers to acknowledge that the provision of online service quality is an expectation of
bank customers.
Khan M.S. & Mahapatra S.S., (2009), explored the service quality of internet banking
operative in India from customer’s perspective. It is observed that customers are satisfied
with the reliability of the services provided by the banks but are not very much satisfied with
the dimension ‘User friendliness’. A seven-dimension model using regression analysis is
developed for measuring the overall service quality of i-banking. The result indicates that the
two dimensions, viz. ‘Privacy/Security’ and ‘Fulfillment’ are not contributing significantly
towards the overall service quality. This is an implication that the customers feel that bankers
fail in providing the services on these two dimensions satisfactorily. It is also observed that
18
the opinion of male and female of business class differs from the other classes. The I-banking
is going to be very crucial for India, having increasing percentage of younger generation
population with computer literacy. Since research on service quality in i-banking is still in its
infancy and the relevant literature is scarce, therefore the insight gained in this study may
offer a foundation for future research on self-service technology and provide useful
recommendations to the bankers for improving the i-banking services.
The limitation of this study is that the result should not be generalized, as the service quality
of i-banking has been tested in urban India. Furthermore, a small sample may not be the
representative of the whole population and hence, in future, the research can be conducted by
taking a large sample to facilitate a robust examination of the service quality of the i-banking.
The future study can also be conducted to identify the relative importance of each dimension.
The extension of this study can also include the providers (bankers) perspective to have a
better understanding of the problem domain. Validation of model and extension of the results
to other industries and also to different cultures are some of the future directions in which the
academics and the practitioners can work with to enrich the service quality literature in i-
banking.
Lio Z. & Cheung M.T., (2008), the study conclude that Internet banking to become
significantly more important in the increasingly technology and information-based global
economy. Financial institutions must therefore deliver ever-better service quality in their
online operations and products. Given that a large number of service-quality attributes can
potentially affect consumer attitudes toward Internet banking, the theory of bounded
rationality suggests that the high decision cost entailed in the pursuit of service-quality
enhancement in each and every direction would be reduced if the opportunity set is rationally
made smaller. To this end, we have proposed a framework under which service-quality
attributes are reduced to a core subset on the basis of both analytical and empirical
considerations. The resulting core framework can then be applied to decision- cost-effective
and empirically prioritized management in Internet banking, especially with regard to market
development. Significant analytical and statistical grounds exist to justify the introduction of
perceived usefulness, ease of use, reliability, responsiveness, security, and continuous
improvement into the core subset. The idea of empirically testing bounded-rational model
construction can also be extended to evaluate re-specification of the core subset in response
to shifts in the business and/or technological environment. If bank-user perceptions and
preferences are found to change with regard to certain core attributes, empirical results
19
obtained in this exercise can be exploited by marketing managers to attract more customers to
online banking.
Srivastava, (2007), reveals that the perception of the consumers can be changed by
awareness program, friendly usage, less charges, proper security, and the best response to the
services offered. The study also provides the kind of correlation between different factors. As
per our basic assumptions we consider only those consumers who know how to use Internet
and have an access to Internet, and our study considered only the situation wherein banks
provide Internet banking of their colleagues or friends who surround him using Internet
banking then it may influence his decision to follow Internet banking option.
Sohail et al (2007), the results of the factor analysis in the present study produced three
dimensions. While this result reveals that “efficiency and security” is the most influencing
factor in users’ evaluation of service quality, the factor group produces a combination of
diverse measures which may be due to the highly correlated nature of service quality
dimensions. Efficiency in internet banking mainly involves download speed, which in turn
involves users in completing a transaction quickly. Findings of the present study support the
results of research by Hoffman and Novak (1996), which a significant correlation between
web site download speed and perception of superior service quality. While speed is of
concern to users, other important factors are the ease of acquiring needed information and the
organization of the information on the site itself.
Banks should strike a balance between attractiveness and speed, ensuring that there is no
usage of extensive high-resolution graphics. The role of host server is also important as this
significantly affects efficiency. Technological developments in recent times have greatly
assisted banks, as the speed of downloading has increased in Saudi Arabia. Security, which
involves protecting users from the risk of fraud and financial loss, has been another important
issue in safe use of the internet when conducting financial transactions in Saudi Arabia. A
number of studies have pointed this out as a key evaluative criterion in online services (for
example Culnan and Armstrong, 1999; Hoffman et al., 1999; Quelch and Klein, 1996). Banks
in Saudi Arabia have used numerous features to boost the confidence of online user, such as
advanced encryption technology, employing a method whereby five minutes of inactivity
automatically logs users off the account or requires users to provide a combination of
different unique identifiers. The second important factor in internet banking users’ evaluation
of service quality as identified in this study is labeled “fulfillment”. In an online context we
20
include the dimensions of technical reliability under this factor. This finds support in the
work of (Zeithaml et al., 2002). The findings of this study are supported by Wolfin barger
and Gilly (2003), who found that reliability/ fulfillment ratings were the strongest predictor of
customer satisfaction and quality and the second strongest predictor of loyalty/intentions to
repurchase at a site. Reliability has also been cited as an important factor in electronic service
quality (Palmer et al., 2000). Finally, the third factor identified in this study is that of
responsiveness, which is deemed important in evaluating internet service quality.
Measurement of service quality generally for service delivery through web sites and
particularly for online banking services is in its early stages; published scholarly literature is
minimal, and hence it is difficult to make comparisons
Prabha, Divya et al, (2006), in their study analyzed the service quality perception of the
corporate customers in Coimbatore regarding the services provided by their banks. For this
study they considered both product and service based on sectors and SERVQUAL scale
based questionnaire for the survey. By this study it has been revealed that even though
customers are more satisfied with the competence and customer orientedness dimensions of
service quality, still banks need to focus upon the aspects of communication, modernization
and quickness of service
The study conducted by Man Siu, Noel Yee et al. (2005)" was an attempt to examine
customer's service quality perceptions in internet banking as well as the impact of these on
customer satisfaction and future consumption behaviour. The study was based on four
dimensions of service quality viz., credibility, efficiency, problem handling and security.
The results of the study showed that all dimensions except security are important in
determining overall service quality perceptions, credibility, problem handling and security are
important on customer satisfaction and security and efficiency are significantly associated
with future consumption behaviour. It concluded as, technically functioning websites and
quick confirmations are the essential elements in satisfying customer needs.
Siu et al, (2005), the findings from this study provide initial direction in determining the
optimum service quality attributes to focus on in evaluating Internet banking service quality.
The conceptual framework for this research is based on the dimensions proposed by Zeithaml
et al. (2000, 2002).
Four dimensions were generated in the current study, namely credibility, efficiency, security
and problem handling. Only one dimension, efficiency, was found to have remained the same
21
as the original construct. New factors labeled credibility, security and problem handling were
formed. The credibility factor had the highest mean score, and this indicates that Internet
banking users are most impressed by technically functioning web sites and quick
confirmations. Bank managers need to emphasize the credibility aspect of their services. On
the other hand, the problem handling factor showed the lowest mean score, indicating that
most of the respondents disagreed that the bank would compensate them for problems their
service had created. Problem handling is related to what Zeithaml et al. (2002) describe as a
recovery dimension. In routine interactions with sites, consumers seem not to be concerned
about the availability of online customer service representatives or the compensation policy
of Internet banks.
However, when customers confront problems and questions, such dimensions would be used
in evaluating electronic service quality. Therefore, it is necessary for practitioners to
investigate present problem handling policies to identify perception gaps between customers
and management. This will help to inspire customers’ confidence in using Internet banking
services. Credibility, problem handling and efficiency have been shown to be moderately
good predictors of overall service quality. The most significant correlation was found in the
efficiency factor. The ease and speed of accessing and using a web site is a vital factor in
evaluating overall service quality. These results are consistent with those of previous studies
(Zeithaml, Parasuraman and Malhotra 2001) that efficiency is the core dimension in
electronic service quality.
This may be explained by the fact that too much information and graphics can be confusing
and would slow down transaction speed. In the case of a pure service such as Internet
banking, service quality is generally believed to be the most important determinant of
customer satisfaction. However, the results indicate that service quality dimensions have only
weak predictive power in terms of the relationship between the overall service quality and
customer satisfaction. The strongest association is with the credibility dimension. This shows
that technically functioning web sites and quick confirmations are the essential elements in
satisfying customer needs. Meeting customer expectations alone is no longer enough. Bank
managers should delight their customers by exceeding their expectations to enhance customer
satisfaction. Such a principle could be applied to technology-based service encounters such as
those in Internet banking.
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CHAPTER 3
THEORETICAL FRAMEWORK
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3.1. The Growth of Internet Banking and common products
Internet Banking is a product of e-commerce in the field of banking and financial

services. In what can be described as B2C domain for banking industry, Internet Banking
offers different online services like balance enquiry, requests for cheque books, recording
stop-payment instructions, balance transfer instructions, account opening and other forms of
traditional banking services.
Mostly, these are traditional services offered through Internet as a new delivery channel.
Banks are also offering payment services on behalf of their customers who shop in different
e-shops, e-malls etc. Further, different banks have different levels of such services offered,
starting from level-1 where only information is disseminated through Internet to level-3
where online transactions are put through. Considering the volume of business e-commerce,
particularly in B2B domain, has been generating, it is natural that banking would position
itself in an intermediary role in settling the transactions and offering other trade related
services. This is true both in respect of B2C and B2B domains.
Besides, the traditional role of financial intermediary and settlement agents, banks have also
exploited new opportunities offered by Internet in the fields of integrated service providers,
payment gateway services, etc. However, the process is still evolving and banks are
repositioning themselves based on new emerging e-commerce business models.
In B2B scenario, a new form of e-commerce market place is emerging where various
players in the production and distribution chain are positioning themselves and are achieving
a kind of integration in business information flow and processing (STP or near STP) leading
to efficiencies in the entire supply chain and across industries. Banks are positioning
themselves in such a market in order to be a part of the financial settlements arising out of
transactions of this market and providing wholesale financial services. This needs integration
of business information flow not only across the players in the supply chain, but with the
banks as well.
With the integration of business information flow and higher degree of transparency, the
banks and other financial services institutions have lost some of the information advantage
they used to enjoy and factor in to pricing of their products. However, such institutions have
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the advantage of long standing relationships, goodwill and brand, which are important
sources of assurance in a virtual market.
Banks are in fact, converting this goodwill into a business component in e-commerce
scenario in providing settlement and other financial services. Some banks have also moved to
providing digital certificates for transactions through e-markets. Banks’ strategies in B2B
market are responses to different business models emerging in e-commerce.
There is no definite answer as to which approach is appropriate. Perhaps it depends on the

type of market the bank is operating, its existing competencies and the legal and regulatory
environment. It is, however, sure that e-banking is evolving beyond the traditional limits of
banking and many new products / services are likely to emerge as ecommerce matures.
3.2 Internet Banking: The Indian Scenario:
"Use of the Internet for banking has seen a massive rise in the 2010-11 survey, taking the
overall number of bank consumers who use the Net to close 7percent of the total bank
account holders -- a seven-fold jump since 2007 -- even as for the first time in the past 13
years, branch banking has come down by a full 15 percentage points during the same period
3.2.1 The entry of Indian banks into Net Banking:
Internet banking is a medium of delivery of banking services and as a strategic tool for
business development, has gained wide acceptance internationally and is fast catching up in
India with more and more banks entering the fray. India can be said to be on the threshold of
a major banking revolution with net banking having already been unveiled. A recent
questionnaire, to which 46 banks responded, has revealed that at present, 11 banks in India
are providing Internet banking services at different levels, banks propose to offer Internet
banking in near future while the remaining 13 banks have no immediate plans to offer such
facility.
At present, the total Internet users in the country are estimated at 9 lakh. However, this is
expected to grow exponentially to 90 lakh by 2003. Only about 1percent of Internet users did
banking online in 1998. This increased to 16.7percent in March 2000. The growth potential
is, therefore, immense. Further incentives provided by banks would dissuade customers from
visiting physical branches, and thus get ‘hooked’ 90 to the convenience of arm-chair banking.
The facility of accessing their account from anywhere in the world by using a home computer
25
with Internet connection, is particularly fascinating to Non-Resident Indians and High Net
worth Individuals having multiple bank accounts.
Costs of banking service through the Internet form a fraction of costs through conventional
methods. Rough estimates assume teller cost at Re.1 per transaction, ATM transaction cost at
45 paise, phone banking at 35 paise, debit cards at 20 paise and Internet banking at 10 paise
per transaction. The cost-conscious banks in the country have therefore actively considered
use of the Internet as a channel for providing services. Fully computerized banks, with better
management of their customer base are in a stronger position to cross-sell their products
through this channel.
3.2.2 Products and services offered
Banks in India are at different stages of the web-enabled banking cycle. Initially, a bank,
which is not having a web site, allows its customer to communicate with it through an e-mail
address; communication is limited to a small number of branches and offices which have
access to this e- mail account. As yet, many scheduled commercial banks in India are still in
the first stage of Internet banking operations.
With gradual adoption of Information Technology, the bank puts up a web-site that provides
general information on the banks, its location, services available e.g. loan and deposits
products, application forms for downloading and e-mail option for enquiries and feedback. It
is largely a marketing or advertising tool. For example, Vijaya Bank provides information on
its web-site about its NRI and other services. Customers are required to fill in applications on
the Net and can later receive loans or other products requested for at their local branch. A few
banks provide the customer to enquire into his demat account (securities/shares) holding
details, transaction details and status of instructions given by him. These web sites still do not
allow online transactions for their customers.
Some of the banks permit customers to interact with them and transact electronically with
them. Such service include request for opening of accounts, requisition for cheque books,
stop payment of cheques, viewing and printing statements of accounts, movement of funds
between accounts within the same bank, querying on status of requests, instructions for
opening of Letters of Credit and Bank Guarantees etc.
With gradual adoption of Information Technology, the bank puts up a web-site that provides
general information on the banks, its location, services available e.g. loan and deposits
26
products, application forms for downloading and e-mail option for enquiries and feedback. It
is largely a marketing or advertising tool.
The race for market supremacy is compelling banks in India to adopt the latest technology on
the Internet in a bid to capture new markets and customers.
3.3 Internet Banking and its various types:
Currently, there are three basic kinds of Internet banking that are being employed in the
market place:
Information:
This is the most basic level of Internet banking. The bank has marketing information about its
products and services on a stand – alone server. This level of Internet banking service can be
provided by the bank itself or by sourcing it out. Since the server or Web site may be
vulnerable to alteration, appropriate controls must therefore be in place to prevent
unauthorized alterations to data in the server or web site.
Communication:
This type of Internet banking allows interaction between the bank’s systems and the
customer. It may be limited to electronic mail, account inquiry, loan applications, or static file
updates. The risk is higher with this configuration than with the earlier system and therefore
appropriate controls need to be in place to prevent, monitor, and alert management of any
unauthorized attempt to access bank’s internal network and computer systems. Under this
system the client makes a request to which the bank subsequently responds.
Transaction:
Under this system of Internet banking customers are allowed to execute transactions. Relative
to the information and communication types of Internet banking, this system possesses the
highest level of risk architecture and must have the strongest controls. Customer transactions
can include accessing accounts, paying bills, transferring funds, etc. These possibilities
demand very stringent security.
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3.3.1 Types of Services Available:
Net banking is a web-based service that enables the banks authorized customers to access
their account information. It allows the customers to log on to the banks website with the help
of bank’s issued identification and personal identification number (PIN).
The banking system verifies the user and provides access to the requested services, the range
of products and service offered by each bank on the internet differs widely in their content.
Most banks offer net banking as a value-added service. Net banking has also led to the
emergent of new banks, which operate only through the internet and do not exists physically,
Such banks are called “virtual” banks or “Internet Only” banks. A couple of years ago, there
was a belief even among bankers that customers opening new accounts wanted the online
banking facility, just to ‘feel good’ and very few of them actually used that services.
Today, bankers believe that the trend from ‘nice to have’ is changing to ‘need to have’ .after
all it depends on how busy a person is. Services provided through Internet Banking
1) Account information
2) E-cheques (Online Fund Transfer)
3) Bill Payment Service
4) Requests and Intimations
5) Demat Account share trading.
Through Internet banking, customers can not only get account balance and see statements of
account online but they can also transfer funds, order demand drafts, pay utility bills etc.
Following types of main transactions or operations can be performed through. Internet
banking:
Account Information:
Provide summary of all bank accounts. Allow transaction tracking which enables retrieval of
transaction details based on cheque number, transaction amount, and date. Provide account
statement and transaction reports used on user-defined criteria. Customers can even download
and print the statement of accounts.
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Funds Transfer (E-Cheque):
Customer can transfer funds: Transfer funds between accounts, even if they are in different
branches’ cities Customer can also transfer funds to any person having an account with the
same bank anytime, anywhere, using third party funds transfer option.
Bill Presentment and Payment:
Banks Bill Payments is the easiest way to manage bills. A/c holder can pay their regular
monthly bills i.e. telephone, electricity, mobile phone, insurance etc. at anytime, anywhere
for free. Saves time and effort. Make bill payments at customer’s convenience form their
home or office. Lets a/c holders check their hill amount before it is debited form their
account. No debits to account without their knowledge. No more missed deadlines, no more
loss of interest – a/c holder can schedule their bills in advance, avoid missing the bill
deadlines as well as earn extra interest on their money. Track payment history – all payments
to a biller are stored automatically for future reference. No queuing up at collection centers or
writing cheque anymore! Just a few clicks and customers account will be debited for the
exact amount they ask.
Premium:
1. Online Payment for Shopping done on Internet.

2. Loan Applications.
3. Standing Instructions.
4. Request and Intimations.
5. Financial Advice.
6. Credit and Debit Cards.
7. Investment Transactions.
8. Customer Correspondence.
10. Opening Accounts.
11. Insurance.
12. Other Value Added / Premium Services etc.
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3.3.2 Mediums of E-banking: [Various products and services:]
Electronic banking, also known electronic fund transfer (EFT), uses computer and electronic
technology as a substitute for checks and other paper transactions. EFTs is initiated through
devices like cards or codes that let you, or those you authorize, access your account.
Many financial institutions use ATM or debit cards and Personal Identification Numbers
(PINs) for this purpose. Some use other forms of debit cards and personal Identification
Numbers (PINs) for this purpose. Some use other forms of debit cards such as those that
require, at the most, your signature or a scan. The federal Electronic Fund Transfer Act (EFT
Act) covers some electronic consumer transactions.
Following are the electronic medium by which services are generally provided by the banks
as a part of e-banking services.
1. Internet Banking
2. ATM (Automatic Teller Machine)
3. Phone Banking
4. Mobile Banking
5. Payment Cards (Debits/Credit Card)
All the above mediums provide services, which can be, also known as “any time any where
banking”. This facilitates the customer of the bank to operate their account from any corner
of the world, without visiting local or any subsidiary branch of their banks. Efforts are made
by the bank not only to provide the facility to the customer, but also to reduce the operational
cost of the bank by providing e- banking services. So with this, banks have to employ less
staff and still would be able to deliver service to the customer, round the corner.
3.3.3 Factors Responsible for Growth of Internet Banking:
Numerous factors including competitive cost, customer service, and demographic

considerations are motivating banks to evaluate their technology and assess their Internet
banking strategies. The challenge for national banks is to make sure the savings from Internet
banking technology more than offset the costs and risks associated with conducting business
in cyberspace.
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Marketing strategies will vary as national banks seek to expand their markets and employ
lower cost delivery channels. Examiners will need to understand the strategies used and
technologies employed on a bank-by-bank basis to assess the risk. Evaluating a bank’s data
on the use of their Web sites, may help examiners determine the bank’s strategic objectives,
how well the bank is meeting its Internet banking product plan, and whether the business is
expected to be profitable.
Competition:
Studies show that competitive pressure is the chief driving force behind increasing use of
Internet banking technology, ranking ahead of cost reduction and revenue enhancement, in
second and third place respectively. Banks see Internet banking as a way to keep existing
customers and attract new ones to the bank.
Cost Efficiencies:
Banks can deliver banking services on the Internet at transaction costs far lower than
traditional brick and mortar branches. The actual costs to execute a transaction will vary
depending on the delivery channel used. The frequently quoted Booz –Allen and Hamilton
study showed that the cost of a customer walking into the branch and using a teller is
US$1.01, where as the cost of conducting the same transaction on the Internet is only a tenth
of the cost. No doubt the ATM is considerably cheaper than a teller, but even so, the Internet
is nearly 3 times cheaper than the ATM usage.
In short, replacing a teller with an Internet channel should in theory, show a 10 fold increase
in the distribution revenue for the bank. This reason alone should be sufficient for banks to
encourage this form of distribution channel.
However, banks should use care in making product decisions. Management should include in
their decision making the development and ongoing costs associated with a new product or
service, including the technology, marketing, maintenance, and customer support functions.
This will help management exercise due diligence, make more informed decisions, and
measure the Success of their business venture.
Geographical Reach:
Internet banking allows expanded customer contact through increased geographical reach and
lower cost delivery channels. In fact some banks are doing business exclusively via the
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Internet. They do not have traditional banking offices and only reach their customers online.
Other financial institutions are using the Internet as an alternative delivery channel to reach
existing customers ads attract new customers.
Branding:
Relationship building is a strategic priority for many national banks. Internet banking
technology and products can provide a means for national banks to develop and maintain an
ongoing relationship with their customers by offering easy access to a broad array of products
and services. By capitalizing on brand identification and by providing a broad array of
financial services, banks hope to build customer loyalty, cross sell, and enhance repeat
business.
Customer Demographics:
Internet banking allows national banks to offer a wide array of options to their banking
customers. Some customers will rely on traditional branches to conduct their banking
business. For many, this is the most comfortable way for them to transact their banking
business. Those customers place a premium on person to person contact other customers are
early adopters of new technologies that arrive in the marketplace. These customers were the
first to obtain PCs and the first to employ them in conducting their banking business. The
demographics of banking customers will continue to change.
Round the Clock Access:
Internet banking services are available on 24 x 7 bases to the customers without charging any
extra cost from the customers. And one can access the bank from anywhere in the world at
one’s own convenience without owning your own PC.
Definition and features of independent variables
Reliability
Reliability is defined as the firm performs the services right the first time and the firm honors
its promises. It involves in accuracy in billing, keeping records correctly, performing the
service at the designated time. In their further research, they also find the reliability consists
of providing services as promised, dependability in handling customers’ service problems,
performing services right the first time, provide services at the promised time and
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maintaining error-free record. Furthermore, they stated reliability as the most important factor
in conventional service
Transactions Efficiency
Transaction efficiency is the ability of the customers gets in to website, find they desire
product and information associate with it, and check out with minimal of effort. Transaction
efficiency also can understand as performance of Internet banking base on some elements: up
to date information, response time, download time, complete product information,
tutorial/demonstration, and help function.
Customer Support
Customer support including before sell support and after sell supports. Before customer make
decisions, the company should give some support to attract them, let customers feel they are
at home. The relationship is like a good friend not like a business. After customers buy the
services or products, company should solve the problem that customers met or response
customers’ questions immediately and according to the problems, company can ameliorate
them. In the Internet banking industries, support is also important. Not everyone good at the
computer so they need guide how to use. And maybe someone good at computer, but still
have problems, and then they also need support. Sometimes, after services on the internet,
customers might have questions waiting to answer, so he or she also needs support. So
support is very important for customers Service
Safety and Security
Security is defined as the freedom from danger, risk, or doubt. It involves physical safety,
financial security and confidentiality. It consists of employees who instill confidence in
customers, making customers feel safe in their transactions, employees who are consistently
courteous and employees who have the knowledge to answer customer question. Moreover,
security is defined as personal and possessions safety of the customers. It is includes
confidentiality maintained by service providers.
Ease of Use
Ease of use is as the factor influencing the adoption of Internet banking, and related to an
easy-to-remember URL address, well-organized, easy in site navigability, concise and
understandable contents, terms and conditions. Performance refer to product’s primary
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operating characteristic which is based on functional requirement, not taste with is
circumstantial preferences.
Service Content
Service content is all information that provides to customers. For internet banking service, is
mean the content that bank provide to customers through website. High value-added content
is essential
How can I tell if a web page is secure?
Anytime a web page asks you for sensitive information, you need to be able to identify if the
page is secure or not. The ability to recognize a secure web connection is extremely
important as online fraud cases have increased substantially from year to year.
What exactly do we mean by "secure"?
Anytime you view web site information is sent from your computer to the web server and
from the web server to your computer. The transmission of this information is normally sent
in "plain text", meaning anyone would be able to read it should they see it. Now consider
this. Each pieces of information transmitted traverses many computers (servers) to reach its
destination.
How can I tell if a web page is secured?
There are two general indications of a secured web page:
1) Check the web page URL
Normally, when browsing the web, the URLs (web page addresses) begin with the letters
"http". However, over a secure connection the address displayed should begin with "https" -
note the "s" at the end.
2) Check for the "Lock" icon
There is a de facto standard among web browsers to display a "lock" icon somewhere in the
window of the browser (NOT in the web page display area!) For example, Microsoft Internet
Explorer displays the lock icon in the lower-right of the browser window.
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Internet banking has become an easy and convenient way to conduct financial transactions.
But like most things on the internet, the onus of a safe and secure banking experience is on
you, the user.
To make sure that you can sleep soundly at night, here are some steps as follows:
1. Never access your bank from a public computer- Always use your own PC to log in to
your account. Public information may have programs running on them that monitor your
keystrokes, which can be used by people to obtain your account password
2. Don’t fall for phishing- sometimes you might get an innocent email, apparently froim
your bank, requesting you for your account details. It’s a trap. Do not fall for it. A bank will
never ask you for your IB password, your debit card PIN number, or credit card of CVV
number,
3. Log off- Always. Never just close your browser. Follow the instructions on your bank
website to securely log off after each session.
4. Protect your Password are the key to accessing your account. Do not disclose them to
anyone, not even bank employee. Frame a password that is hard to crack – let it not be your
nick name, birthday your spouse’s or kid’s name. Use a combination of letters and numbers,
uppercase and lower case. Also, change your password often.
5. Be wary of fake websites- Always check whether the website at which you log in your
account details is genuine. There are fake websites out there that parade themselves as well-
known bank websites to procure your account details. Some of them are very convincing.
Check the address of the website carefully before typing in your password. Also check for the
128-bit encryption seal (VeriSign) on the home page that loads up.
6. Close all other websites- before you access your account close their sites. This ensures
that your personal information is nit accessed by any other websites which could be running
some malware
Description of security features in Internet Banking
The various security features incorporated by banks to protect IB users from various risks
associated with IB are given below.
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1. VeriSign: VeriSign symbol is found on the index page of the Internet banking
website of banks, which guarantee that users are dealing with a secure website.
VeriSign is world’s leading Internet Certification Authority
2. Padlock Symbol: Padlock symbol on the internet banking screen is an indication that
the website is legitimate. There is a de facto standard among web browsers to display
a lock icon somewhere in the window of the browser. For example, Microsoft Internet
Explorer displays the lock icon in the lower right of the browser window. Double
clicking on it will display the VeriSign Certificate authenticating the site.
3. The Letter‘s’ in the URL: IB users will know that they are at a secured site when
they see https:// in the address field on the internet browser. It means that the user
name and password typed will be encrypted before sent to bank’s server. The letter ‘s’
in the URL indicate that the website is ‘secured’.
4. Virtual Keyboard: the virtual keyboard is an onscreen keyboard which provides a
mouse based alternative, for entering IB username and password, instead of using the
actual physical keyboard. A virtual keyboard prevents IB username or password from
being stolen, especially while using public computer, such as those available in
internet cafes. Public computers may have software installed over them known as
“Key logger” which stores information about the keys pressed and the pages accessed.
IB users use the mouse to enter the username and password by clicking on the keys of
the Virtual Keyboard rather than typing them using the keyboard.
5. SMS Alert: IB users receive regular SMS alerts from the bank when their account is
credited or debited. Any unauthorized transaction happened in an account is
immediately brought to the notice of IB users through SMS alerts.
6. Sign on Password Expiry: if an IB user is not changing his/her password within a
specified period of time. IB password expires as per the security policy of banks. This
security features forces IB users to change their passwords.
7. Automatic Lockout on Multiple Incorrect Password: To prevent somebody from
guessing any of the IB user’s password and getting unauthorized access to IB account,
the user ID is locked immediately in case of a specified number of (usually 3 times)
wrong password entries.
8. Automatic Timeout if Account not Operated for Specified Time: to prevent an
unauthorized person from viewing someone’s net banking account in case an IB user
leave his/her computer idle, the internet session is closed in case of inactivity for a
specified period of time (usually 5 minutes).
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9. Mandatory Use of Special Characters in Password: To prevent somebody from
guessing any of the IB user’s password and getting unauthorized access to IB account,
the password should compulsorily contain a mix of alphabets, numbers and special
characters such as !@#$%^&*(){}. This security feature prohibits IB users to use
personal data as passwords such as name, address, telephone number etc. which are
easily guessable by others.
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CHAPTER 4
ANALYSIS AND INTERPRETATION
38
Analysis of Data
The result of the survey conducted as a part of the research study has been presented and
analyzed in this chapter. Analysis of data is the most skilled task in the research process.
Analysis of data means studying the tabulated material in order to determine inherent facts or
meanings. In other words the analysis means the computation of certain indices or measure or
coefficients along with searching for pattern of relationships that exist among data groups.
The analysis is presented in five parts
1. Demographic profile of respondents

2. Reasons for using IB services
3. Customer satisfaction on IB service quality
4. Problems faced by IB users
5. Level of trust on security features available in IB
Friedman Test, Two-way ANOVA and Kruskal-Wallis Test are used for making these
analyses.
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TABLE 4.1.1
DEMOGRAPHIC PROFILE OF RESPONDENTS
NO.OF CUMULATIVE
CATEGORY
RESPONDANTS FREQUENCY
LESS THAN/= 25 24 24
26 TO 30 25 49
AGE 31 TO 40 25 74
GREATER THAN/= 41 26 100
MALE 64 64
GENDER
FEMALE 36 100
UP TO PLUS TWO 13 13
GRADUATE 10 23
EDUCATION POST GRADUATE 70 93
QUALIFICATION PROFESSION 7 100
UNEMPLOYED 16 16
PUBLIC SECTOR 25 41
OCCUPATION PRIVATE SECTOR 32 73
BUSINESS/PROFESSION 27 100
LESS THAN/= 10000 21 21
10001 TO 20000 33 54
AVERAGE
20001 TO 30000 19 73
MONTHLY INCOME
SAVINGS 77 77
TYPE OF BANK A/C
CURRENT 23 100
LESS THAN/= 5 34 34
USAGE OF BANKING 6 TO 10 27 61
SERVICE(YRS) 11TO 15 18 79
LESS THAN/= 2 31 31
USAGE OF IB 3 TO 5 33 64
SERVICE 6 TO 8 26 90
LESS THAN/= 3 25 25
AVG MONTHLY 4 TO 7 29 54
USAGE OF IB 8 TO 10 19 73
VERY GOOD 21 21
GOOD 67 88
ACCESSABILITY OF
AVERAGE 10 98
IB
POOR 2 100
VERY POOR 0 100
VERY GOOD 16 16
GOOD 62 78
WEBSITE
AVERAGE 20 98
PRESENTATION
POOR 2 100
VERY POOR 0 100
Table 4.1.exhibit the profile of the sample respondents selected for the study. The
majority of IB users belong to the age group greater than 40. Gender wise classification
shows that out of the 100 respondents, majority (64percent) are male. As to education
40
Qualification 70 percent are post graduate and only 7 percent are professionally qualified.
From the table it can be seen that majority (32 percent) are belong to private sector followed
by business and profession. The monthly income classification of the respondents reveals that
majority of them falls under the income group 10001-20000 and almost 73 percent
respondents were receiving less than 30000 as monthly income. The table shows that 77
percent respondents having Savings bank a/c. the classification of the sample based on the
usage of IB services shows that majority of respondents are using IB for about 3 to 5 years
and also, it may be seen that most of them (46 percent) using IB services for almost 8 and
above times. From the table it can be seen that majority of respondents have better
perception and opinion about the accessibility of IB services and Website presentation of
Bank.
4.2 Reason for Using IB Services
Using of IB services is influenced by many factors. It might be because of speed,

convenience, transaction efficiency, user friendly characteristics etc…
Friedman test is used to test the following hypothesis.
H0: there is no significant difference in the reason for using IB services of users.
H1: there is significant difference in the reason for using IB services of users.
The test results are presented in the following table.
Table 4.2.1
Mean ranks Obtained for the reason behind in using IB services
Ranks
Mean Rank Rank
SPEED 2.25 2
CONVENIENCE 2.01 *1
TRANSACTION EFFICIENCY 2.49 3
USER FRIENDLY 3.25 4
The mean ranks obtained for the reason behind the using of IB services are stated above. The
lower the ranks, the higher will be the preference or preferable reason. As per table given that
the highest preference is given to convenience (mean rank 2.01), followed by speed (mean
rank 2.25) and transaction efficiency (mean rank 2.49).
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Table 4.2.2: Friedman Test
Test Statistics
N 100
Chi-Square 51.912
Df 3
Asymp. Sig. 0.000**
a. Friedman Test
The chi-square static provides a value of 51.912, which is significant at 5 percent

level of significance (0.000<0.05). Therefore, the null hypothesis of “no difference in the
reason for using IB services among selected users” is rejected. This indicates the variation in
the preference of users in the selection of IB services.
4.3 Customer Satisfaction on IB Service Quality
4.3.1 Two-Way Anova of Transaction efficiency (TE) by Gender and Education

Qualification
The variation of transaction efficiency with regard to gender and Education Qualification
of respondents are analyzed with Two-Way ANOVA and the output is presented in the
following tables.
Table 4.3.1.1 Gender wise Estimated Marginal Means- TE
1. GENDER
Dependent Variable: Transaction Efficiency
GENDER Mean Std. Error 95percent Confidence Interval
Lower Bound Upper Bound
Male 15.715 0.344 15.033 16.397
Female 14.864 0.405 14.059 15.669
Source: primary data
Table 4.3.1.2
Education Qualification wise Estimated Marginal Means- TE
2. Education Qualification
Education Mean Std. Error 95percent Confidence Interval
Qualification Lower Bound Upper Bound
Up to plus two 14.156 0.589 12.986 15.325
Graduate 14.900 0.658 13.593 16.207
Post graduate 15.593 0.257 15.083 16.102
Profession 16.511 0.787 14.948 18.074
Source: primary dat
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Table 4.3.1.3
Two-Way ANOVA – TE
Tests of Between-Subjects Effects
Source Type I Sum of df Mean F Sig.
Squares Square
Gender 24100.668 2 12050.334 2781.177 0.000*
Education
33.714 3 11.238 2.594 0.057
Qualification
Error 411.618 95 4.333
Total 24546.000 100
*Significant at 5percent level of significance
The test of mean variation of scores for Transaction efficiency of IB among male and female
and among respondents having different Education Qualification wise by using Two-way
Anova shows that Gender-wise variation of mean scores are statistically significant at 5 per
cent level of significant (F=2781.77, df=2 with P=0.00<0.05) while Education Qualification-
wise, it is not statistically significant. Table shows that male have the high mean score i.e the
high mean score for male category signifies high level of satisfaction towards transaction
efficiency of IB service.
4.3.2 Two-Way Anova of Reliability by Gender and Education Qualification

The variation of Reliability with regard to gender and Education Qualification of
respondents are analyzed with Two-Way ANOVA and the output is presented in Table
4.3.2.1, 4.3.2.2 and 4.3.3.3.
Table 4.3.2.1
Gender wise Estimated Marginal Means- Reliability
Gender
Dependent Variable: Reliability
Gender Mean Std. Error 95percent Confidence Interval
Male 15.755 0.455 14.851 16.659
Female 15.552 0.537 14.485 16.618
43
Table 4.3.2.2
Education Qualification wise Estimated Marginal Means- Reliability
Education Qualification
Qualification Mean Std. Error 95percent Confidence
Interval
Up to plus two 14.714 0.781 13.165 16.264
Graduate 14.000 0.872 12.269 15.731
Post graduate 15.628 0.340 14.953 16.303
Profession 18.271 1.043 16.200 20.342
Table 4.3.2.3
Two-Way ANOVA – Reliablity
Source Type I Sum of df Mean Square F Sig.
Squares
Gender 24212.111 2 12106.056 1591.637 0.000*
Education
85.315 3 28.438 3.739 0.014*
Qualification
Error 722.574 95 7.606
Total 25020.000 100
Above Tables shows the satisfaction level on reliability of IB among selected respondents
based on Gender and Education Qualification. Two way Anova is used to test the mean
variation of scores for reliability of IB services between male and female and their Education
Qualification. From the above tables, it is found that gender wise and Education Qualification
wise variations of the mean scores are statistically significant at 5 percent level of
significance (F= 1591.637, 3.739 and df= 2, 3 with P= 0.000, 0.014 < 0.05) Table 4.3.2.1
clearly states that male have the high mean score. It implies that male are highly satisfied
with this quality dimension and Table 4.3.2.2 shows that respondents with Professional
Education Qualification have the high mean score i.e they are having high level of
satisfaction as to IB services.
44
4.3.3 Two-Way Anova of Service Content (SC) by Gender and Education
Qualification
The variation of Service Content with regard to gender and Education Qualification of
respondents are analyzed with Two-Way ANOVA and the output is presented in the
following Tables.
Table 4.3.3.1
Gender wise Estimated Marginal Means- SC
GENDER
Dependent Variable: Service Content
Male 15.397 0.399 14.606 16.188
Female 15.150 0.470 14.216 16.084
Table 4.3.3.2
Education Qualification wise Estimated Marginal Means- SC
EDUCATION QUALIFICATION
Up to plus two 14.318 0.684 12.961 15.675
Graduate 13.800 0.764 12.284 15.316
POST GRADUATE 15.708 0.298 15.117 16.298
Profession 17.268 0.914 15.454 19.082
Table 4.3.3.3
Two-Way ANOVA – SC
Squares
Gender 23964.250 2 11982.125 2054.335 0.000*
Education
71.652 3 23.884 4.095 0.009*
Qualification
Error 554.098 95 5.833
Total 24590.000 100
Above Tables shows the satisfaction level on service content of IB among selected
respondents based on Gender and Education Qualification. Two way Anova is used to test the
45
mean variation of scores for service content of IB services between male and female and their
Education Qualification. From the above tables, it is found that gender wise and Education
Qualification wise variations of the mean scores are statistically significant at 5 percent level
of significance (F= 2054.335, 4.095 and df= 2, 3 with P= 0.000, 0.009 < 0.05) Table 4.3.3.1
clearly states that male have the high mean score. It implies that male are highly satisfied
with this quality dimension and Table 4.3.3.2 shows that respondents with Professional
Education Qualification have the high mean score i.e. they are having high level of
satisfaction as to IB services.
4.3.4 Two-Way Anova of Customer Support (CS) by Gender and Education

Qualification
The variation of Customer support with regard to gender and Education Qualification
of respondents are analyzed with Two-Way ANOVA and the output is presented in the
following Tables.
Table 4.3.4.1
Gender wise Estimated Marginal Means- CS
GENDER
Dependent Variable: Customer support
Male 14.486 0.452 13.590 15.383
Female 13.989 0.533 12.931 15.047
Table 4.3.4.2
Education Qualification wise Estimated Marginal Means- CS
Dependent Variable: Customer support
Up to plus two 13.943 0.775 12.405 15.481
Graduate 13.500 0.865 11.782 15.218
POST GRADUATE 14.686 0.337 14.017 15.356
Profession 14.822 1.035 12.766 16.877
46
Table 4.3.4.3
Two-Way ANOVA – CS
Dependent Variable: Customer Support
Squares
Gender 21176.293 2 10588.147 1413.600 0.000*
Education
17.138 3 5.713 0.763 0.518
Qualification
Error 711.569 95 7.490
Total 21905.000 100
The test of mean variation of scores for Customer Support quality of IB among male and
female and among respondents having different Education Qualification wise by using Two-
way Anova shows that Gender-wise variation of mean scores are statistically significant at 5
per cent level of significant (F=1413.6, df=2 with P=0.00<0.05) while Education
Qualification-wise, it is not statistically significant. Table shows that male have the high
mean score i.e. the high mean score for male category signifies high level of satisfaction
towards customer support quality of IB service.
4.3.5 Two-Way Anova of Ease of Use (EU) by Gender and Education

Qualification
The variation of Ease of Use with regard to gender and Education Qualification of
following tables.
Table 4.3.5.1
Gender wise Estimated Marginal Means- EU
GENDER
Dependent Variable: Ease of Use
Male 16.305 0.422 15.467 17.143
Female 15.601 0.498 14.612 16.589
47
Table 4.3.5.2
Education Qualification wise Estimated Marginal Means- EU
Up to plus two 14.733 0.724 13.296 16.171
Graduate 15.500 0.809 13.895 17.105
POST GRADUATE 16.057 0.315 15.431 16.682
Profession 17.521 0.967 15.601 19.441
Table 4.3.5.3
Two-Way ANOVA – EU
Squares
Gender 25704.694 2 12852.347 1965.500 0.000*
Education
39.103 3 13.034 1.993 0.120
Qualification
Error 621.202 95 6.539
Total 26365.000 100
The test of mean variation of scores for Ease of Use of IB among male and female and among
respondents having different Education Qualification wise by using Two-way Anova shows
that Gender-wise, variation of mean scores are statistically significant at 5 per cent level of
significant (F=1965.5, df=2 with P=0.00<0.05) and Education Qualification-wise, it is not
statistically significant. Table shows that male have the high mean score i.e the high mean
score for male category signifies high level of satisfaction towards Ease of Use of IB service.
4.3.6 Two-Way Anova of Safety and Security (SS) by Gender and Education
Qualification
The variation of safety and Security with regard to gender and Education Qualification of
following tables.
48
Table 4.3.6.1
Gender wise Estimated Marginal Means- SS
GENDER
Dependent Variable: Safety and Security
Male 16.431 .421 15.595 17.266
Female 16.356 .497 15.370 17.342
Table 4.3.6.2
Education Qualification wise Estimated Marginal Means- SS
Up to plus two 15.518 .722 14.085 16.951
Graduate 14.400 .806 12.799 16.001
POST GRADUATE 16.946 .314 16.323 17.570
Profession 18.709 .965 16.794 20.624
Table 4.3.6.3
Two-Way ANOVA – SS
Squares
Gender 27689.141 2 13844.570 2128.883 .000
Education
103.055 3 34.352 5.282 .002
Qualification
Error 617.805 95 6.503
Total 28410.000 100
Table 4.3.6.1, 4.3.6.2, 4.3.6.3 shows the satisfaction level on safety and security of IB
among selected respondents based on Gender and Education Qualification. Two way Anova
is used to test the mean variation of scores for safety and security of IB services between
male and female and their Education Qualification. From the above tables, it is found that
gender wise and Education Qualification wise variations of the mean scores are statistically
significant at 5 percent level of significance (F= 2128.883, 5.282 and df= 2, 3 with P= 0.000,
49
0.002 < 0.05). Table 4.3.6.1 clearly states that male have the high mean score. It implies that
male are highly satisfied with this quality dimension and Table 4.3.6.2 shows that
respondents with Professional Education Qualification have the high mean score i.e they are
having high level of satisfaction as to IB services.
4.4 Problems Faced by Users while Using Internet Banking Services
Following are the commonly founded problems faced by the users while using IB services.
1. Inability to login/operate the account

2. Account temporarily locked by bank
3. Transaction failed but amount is deducted
4. Money lost without knowledge
5. Low speed
6. Connection problems due to server errors
7. Personal information leaked out
8. Inadequate customer support from bank employee
9. Transaction details missing
10. Lengthy procedure to complete transaction
11. Inability to get One Time Password due to network error
12. Delay in getting new password in place of present
Friedman test is used to find out the major problems faced by the users among the selected
sample based on their perception and experience and test the following hypothesis too
H0: there is no difference in the perception on the problems faced by the IB users while using
IB service
H1: there is difference in the perception on the problems faced by the IB users while using IB
service
50
Table 4.4.1
Mean ranks obtained for the problems faced by the IB Service Users
RANKS
MEAN RANK RANK
Inability to login of a/c 6.38 6
Account temporarily locked 7.05 8
Transaction failed and amount 7.12 9
Money lost without 8.39 12
Low speed 4.61 1
Connection problems 4.64 2
Personal information leaked 8.02 11
Inadequate customer support 6.66 7
Transaction details missing 7.14 10
Lengthy procedure 6.29 5
Inability to get one time 5.72 3
Delay in getting new 6.02 4
The mean ranks obtained for the problems faced by the users while using of IB services are
stated above. The lower the ranks, the higher will be the major problem. As per table given
that the highest or major problem faced by the users is Low Speed (mean rank 4.61),
followed by Connection Problems (mean rank 4.64) and Inability to get One Time Password
(mean rank 5.72).
Table 4.4.2: Friedman Test

a
Test Statistics
N 100
Chi-Square 135.868
Df 11
Asymp. Sig. 0.000*

a. Friedman Test
The chi-square static provides a value of 135.88, which is significant at 5 percent level of
significance (p = 0.000<0.05). Therefore, the null hypothesis of “no difference in the
perception on the problems faced by users while using IB services” is rejected. This indicates
the variation in the preference or perception on the problems faced by the IB users.
51
4.5 Level of Trust towards the Security Features of IB
Following are the security features available in Internet banking
1. VeriSign
2. Padlock Symbol (PS)
3. Letter ‘s’ in the URL
4. Virtual Keyboard (VK)
5. SMS/Email Alert
6. Sign on Password Expiry (SPE)
7. Automatic Lockout on Multiple Incorrect Password (ALMIP)
8. Automatic timeout if a/c not operated for specific time (ATIANOST)
9. Mandatory use of special characters in password (MUSCP)
10. Address bar turning green (ABTG)
Kruskal Wallis test is used to find the level of trust and to test the following hypothesis
H0: There is difference in the perception on the security features of IB among users having
different Education Qualification
H1: There is no difference in the perception on the security features of IB among users
having different Education Qualification
Table 4.5.1
Education Qualification-wise means ranks on Security Features of IB services
RANKS
QUALIFIACTION N MEAN RANK
Up to plus two 13 46.85
Graduate 10 52.00
VeriSign
Post graduate 70 50.61
Profession 7 54.07
Graduate 10 47.75
Padlock symbol
Profession 7 50.64
52
THE LETTER 's' IN THE Graduate 10 48.00
URL Post graduate 70 49.49
Profession 7 65.29
Graduate 10 32.40
Virtual keyboard
Profession 7 36.71
Graduate 10 51.40
Sms/email alert
Profession 7 36.79
Graduate 10 52.65
Sign on password expiry
Profession 7 67.79
Automatic lockout on multiple Graduate 10 65.10
password incorrect Post graduate 70 48.29
Profession 7 67.50
Graduate 10 55.80
Automatic timeout
Profession 7 58.79
Mandatory use of special Graduate 10 51.95
characters in password Post graduate 70 51.09
Profession 7 58.86
Graduate 10 54.10
Address bar turning green
Profession 7 41.21
53
Table 4.5.2: Kruskal Wallis Test
Chi-Square
LETTER
's' IN
THE SMS/EMAIL
VERISIGN PS URL VK ALERT SPE ALMIP ATIANOST MUSCP ABTG
Chi- .409 .141 2.155 8.423 3.749 3.420 7.918 1.266 2.369 1.820
Square
Df 3 3 3 3 3 3 3 3 3 3
Asymp. 0.938 0.986 0.541 0.038** 0.290 0.331 0.048** 0.737 0.499 0.611
Sig.
a. Kruskal Wallis Test
b. Grouping Variable: QUALIFIACTION
Source:PrimaryData
*Significant at 5 percent level of significance
The Education Qualification wise mean rank table shows that users with professional Education
Qualification have the better perception and high level of trust on all the security features available in
IB except Virtual Keyboard, SMS alert, Automatic Lockout on Multiple Incorrect Password. All
hypothesis except related to Virtual keyboard, Automatic Lockout on Multiple Incorrect Password
(ALMIP) are not rejected as the P values are 0.038 and 0.048. As related to hypothesis, other security
features are rejected as the P values are 0.938, 0.986, 0.541, 0.290, 0.331, 0.737, 0.499 and 0.611
(P>0.05)
Therefore it can be concluded that based on Education Qualification wise, there is significant
difference among IB users in relation to level of trust on security features – Virtual Keyboard and
Automatic Lockout on Multiple Incorrect Password.
54
CHAPTER 5
FINDINGS, SUGGESTIONS AND CONCLUSION
55
FINDINGS
1. Demographic profile of the Selected IB Users
The majority of IB users belong to the age group greater than 40. Gender wise classification
shows that out of the 100 respondents, majority (64 percent) are male. As to Education
Qualification 70 percent are post graduate and only 7 percent are professionally qualified.
From the table it can be seen that majority (32 percent) are belong to private sector followed
by business and profession. The monthly income classification of the respondents reveals that
majority of them falls under the income group 10001-20000 and almost 73 percent
respondents were receiving less than 30000 as monthly income. The table shows that 77
percent respondents having Savings bank a/c. the classification of the sample based on the
usage of IB services shows that majority of respondents are using IB for about 3 to 5 years
and also, it may be seen that most of them (46 percent) using IB services for almost 8 and
above times. From the table it can be seen that majority of respondents have better
perception and opinion about the accessibility of IB services and Website presentation of
Bank.
2. Reason for Using IB Service

Out of the different factors that motivate the customer to use the IB service, Convenience
factor is most considered. The mean rank variation of all the motivating factors or reasons is
statistically significant in the output of Friedman test (P=0<0.05). Lowest mean rank is highly
preferred. Here convenience factor has the lowest mean rank (2.01), followed by speed
(2.25).
3. Customer Satisfaction on IB Service Quality Dimensions
3.1 Transaction Efficiency
The satisfaction level in respect of IB’s transaction efficiency among selected users shows
that Majority of respondents are highly satisfied with this quality dimension. Gender wise,
male respondents are highly satisfied. The mean score variation of the respondents is
statistically validated at 5percent level of significance by applying two way anova
(P=0<0.05).
56
3.2 Reliability
The satisfaction level in respect of Reliability of IB service among selected users shows that
Majority of respondents are highly satisfied with this quality dimension. Gender wise, male
respondents and Education Qualification wise, respondents with professional Education
Qualification are highly satisfied. The mean score variation of the respondents is statistically
validated at 5percent level of significance by applying two way anova (P=0.00, 0.014<0.05).
3.3 Service Content
The satisfaction level in respect of Service Content of IB service among selected users shows
that Majority of respondents are highly satisfied with this quality dimension. Gender wise,
male respondents and Education Qualification wise, respondents with professional Education
Qualification are highly satisfied. The mean score variation of the respondents is statistically
validated at 5percent level of significance by applying two way anova (P=0.00, 0.009<0.05).
3.4 Customer Support
The satisfaction level in respect of Customer Support Quality of IB among selected users
shows that Majority of respondents are satisfied with this quality dimension. Majority of
them are not satisfied with Online Customer service representative availability. Gender wise,
male respondents are highly satisfied. The mean score variation of the respondents is
statistically validated at 5percent level of significance by applying two way anova
(P=0<0.05).
3.5 Ease of Use
The satisfaction level in respect of Ease of Use of IB among selected users shows that
Majority of respondents are highly satisfied with this quality dimension. Gender wise, male
respondents are highly satisfied. The mean score variation of the respondents is statistically
validated at 5 percent level of significance by applying two way anova (P=0<0.05).
3.6 Safety and Security
The satisfaction level in respect of Safety and Security feature of IB service among selected
users shows that Majority of respondents are satisfied with this quality dimension. Gender
wise, male respondents and Education Qualification wise, respondents with professional
Education Qualification are highly satisfied. The mean score variation of the respondents is
57
statistically validated at 5 percent level of significance by applying two way anova (P=0.00,
0.002<0.05).
4. Problems Faced by the IB Users

The mean ranks obtained for the problems faced by the users while using of IB services
shows that the highest or major problem faced by the users is Low Speed and Connection
Problems due to Server Error. Friedman test is used for this purpose. The lower the ranks, the
higher will be the major problem where mean rank of Low Speed is 4.61, followed by
Connection Problems (mean rank 4.64) and Inability to get One Time Password (mean rank
5.72).
5. Level of trust of customers on Security Features available in IB

• Majority of respondents are not aware of VeriSign security and Padlock Symbol security.
• The Education Qualification wise mean rank table shows that users with professional
Education Qualification have the better perception and high level of trust on all the security
features available in IB except Virtual Keyboard, SMS alert, Address bar turning to green.
Kruskal-Wallis used for this purpose. As a result, it is observed that based on Education
Qualification wise, there is significant difference among IB users in relation to level of trust
on security features – Virtual Keyboard and Automatic Lockout on Multiple Incorrect
Password.
58
SUGGESTIONS
1. Respondents are dissatisfied with online customer service representative. So there is a
need to rectify the online connectivity of the customer service representative. Most of
the bank does not have online service representative or inexperienced online service
representative. Those who do not have online customer service representative need to
be hire trained and energetic employees. Its lead to promptness in problem solving of
a respondents at the time of occurrence of problem, which make customer more
satisfied.
2. Safe and security features of webpage need to be improved because most of the
respondents feel that Internet Banking is not safe and secure. People are so much
conscious about the security measures whether it might provide privacy and security
for the information that entered.
3. Out of the mentioned problems, it is founded that Low Speed and Connection
problem due to server errors are the major problems faced by Users. Therefore banks
need to take corrective measures to improve their server efficiency.
4. Banks has to conduct various awareness programs in order to improve the level of
awareness and knowledge of customers about the functioning of IB and its attributes.
59
CONCLUSION
The results of this research indicated that transaction efficiency, ease of use, service content
are important determinants of customers’ satisfaction with internet banking. However,
privacy and security problems, low speed and connection problems due to server errors are
the main/major problems faced by the IB users. It indicates that as cost and time customers
spent on internet banking increases, customers’ satisfaction will decrease. Therefore, this
paper suggests certain policy implications for the banking industry. Thus, the proposed model
can be of help in planning efforts towards increasing consumers’ satisfaction. By improving
these factors, bank management may increase adoption and satisfaction among internet bank
users. These also imply initiating appropriate actions to enhance basic facilities and improve
privacy and security on internet banking. This in essence will improve business transaction
and thus increase overall customer satisfaction.
Although the use of IT is expected to lead to a favorable impact on bank performance, the
banks need performance measures which are related to customers to improve their
performance and minimize waste of productive customers. The way forward therefore, is for
the banks to increase awareness about the use of this technological tool to help them capture
relevant and timely information for decision making. Managing e-banking demands
analytical ability and attention to details, for the satisfactory performance of this system,
these determinants should be mixed in their right prescription to get high quality internet
banking and incorporate newer ideas. There is needed to make concerted efforts towards
operational efficiency of internet banking.
60
BIBLIOGRAPHY
BUGHIN J (2004), “The Success of Internet Banking: an economic investigation of its
pattern of diffusion within Western Europe”
MD. MAHTAB ALAM (2010), “Customers satisfaction Measurement of Internet Banking”
RANGSAN NOCHAI (2010), “The Impact of Internet Banking Service on Customer
Satisfaction in Thailand: A Case Study in Bankok”
MINJOON JUN, SHAOHAN CAL, “The Key Determinants of Internet Banking Service
Quality: a Content Analysis”
M E DODDARAJU, “A Study on Customer Satisfaction towards Public and Private Sector
Banking Service”
NAKANJAKKO LYDIA, “Electronic Banking and Customer Satisfaction- Case Study:
Centenary Bank”
MOHSIN ZAFAR, ARSHAD ZAHEER, “Impact of Online Service Quality on Customer
Satisfaction in Banking Sector”
ITORO MOSES IKOH, “Determinants of Customer Satisfaction with Internet Banking
Services”
BOOKS
“Banking with Technology” – R.K. Uppal
“Commercial Banks in India: Growth, challenge and strategies”- Benson Kunjukunju
WEBSITES
www.shodhganga.inflibnet.ac.in
www.isaet.org
www.ijstr.org
www.researchgate.net
www.scribd.com
www.aicit.org
www.academia.edu
www.investopedia.com
www.wikipedia.com
61
APPENDIX
QUESTIONNAIRE
CUSTOMER SATISFACTION ON INTERNET BANKING SERVICE

QUALITY
PART - I
(Please choose your answer by a tick mark [√])
1. Age : ………… years
2. Gender : Male Female
3. Education Qualification : Up to +2 Graduate
PG Profession
4. Occupation : Unemployed Job in Public sector
Job in Pvt Sector Business/ profession
5. Average Monthly Income : Rs …………………….
PART – II
6. Type of your bank account
Saving Current Recurring
7. How long have you been using banking services : …….. (years)
8. How long have you been using Internet Banking Service : …….. (years)
9. How many times on an average you use Internet Banking Services in a month : …….
(times)
10. Reasons for using IB Service (please rank the following based on your experience)
a) Speed b) Convenience
c) Transaction Efficiency d) User friendly
11. How do you feel about the accessibility of IB Services?
Excellent Good Average Poor Very Poor
62
12. What is your opinion about the Website presentation of your bank?
Excellent Good Average Poor Very Poor
13. Given below are set of statements that are related to your feeling of experience/
Satisfaction on the Internet Banking Services of the bank. Indicate your extent of agreement
or disagreement with each statement by a tick mark [√] to the appropriate answer.
[5] Highly Satisfied, [4] Satisfied, [3] Neutral, [2] Dissatisfied, [1] Highly dissatisfied
IB Service Quality Dimensions 5 4 3 2 1

13.1 Transaction Efficiency
13.1.1) Speed of Transaction
13.1.2) Server efficiency during transaction
13.1.3) Provide complete help function
13.1.4) Can check the validity and details of past records every
time
13.2 Reliability
13.2.1) Perform the service right at the first time
13.2.2) Deliver the service exactly as promised in Ads
13.2.3) Message about completion of transaction
13.2.4) A/c statement through SMS/Email (download facility)
13.3 Service Content
13.3.1) Availability of up to date information
13.3.2) Provide information that exactly fit needs
13.3.3) Provide adequate information about the product
13.3.4) Provide information that trust
13.4 Customer Support
13.4.1) Informing customer about new and important
information
13.4.2) Contains comprehensive FAQs (frequently asked
Questions) section to guide
13.4.3) Promptness of bank response at the time of occurrence of
problems
13.4.4) Online customer service representative availability
13.5 Ease of Use
13.5.1) Easy to find required information
13.5.2) Clarity of information and text used
13.5.3) Availability of multiple language
13.5.4) Provide step by step instruction and guidelines
13.6 Safety and Security
13.6.1) Keep accurate and error free records
13.6.2) Warning signals in website
13.6.3) Confirmation message immediately after transaction
13.6.4) Password and Lock facility
63
14. The following table outlines some of the problems that you might have faced in the
course of using of IB. Please indicate the frequency of each of the following problems
faced as [1] Very High, [2] High, [3] Medium, [4] Low, [5] Very Low
Problems faced by the IB users 1 2 3 4 5
14.1) Inability to login/operate the account

14.2) Account temporarily locked by bank
14.3) Transaction failed but amount is deducted
14.4) Money lost without my knowledge
14.5) Low speed
14.6) Connection problems due to server errors
14.7) Personal information leaked out
14.8) Inadequate customer support from bank employee
14.9) Transaction details missing
14.10) Lengthy procedure to complete transaction
14.11) Inability to get One Time Password due to network
error
14.12) Delay in getting new password in place of present
15. The following are the security features available in Internet Banking. Please mark a score
of 1-3 depending on your level of trust towards the security features. If you are not aware of
any of them, please mark a tick [√] in the column ‘not aware’
[3] Most trusted, [2] Average, [1] Low trusted, [0] Not aware
Security Features 3 2 1 0
15.1) VeriSign
15.2) Padlock Symbol
15.3) The letter ‘s’ in the URL (e.g. https//onlineshop.com)
15.4) Virtual Keyboard
15.5) SMS/E-mail Alert
15.6) Sign on Password Expiry
15.7) Automatic lockout on multiple incorrect password
15.8) Automatic timeout if a/c not operated for specified time
15.9) Mandatory use of special characters in password
15.10) The address bar turning green
64

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“CUSTOMER SATISFACTION ON INTERNET BANKING SERVICE

A PROJECT REPORT SUBMITTED TO THE UNIVERSITY OF CALICUT IN

UNDER THE SUPERVISION AND GUIDANCE OF

ASSISTANT PROFESSOR OF COMMERCE

POST GRADUATE DEPT. OF COMMERCE

GOVERNMENT COLLEGE, CHITTUR

I RATHEESH K K hereby declare that the project report titled “CUSTOMER

Date: Name and designation of

Place: Signature of the

Date : Head of the Department

(AFFILIATED TO CALICUT UNIVERSITY)

Date: Name& Designation of Supervising Teacher

Every study is a learn more. It is essentially a pursuit in solitude. However, there

I acknowledge my sincere and profound gratitude to our Smt. C.A.VISHALAKSHI,

I am extremely grateful to my supervising teacher Sri PRADEESH.K, Asst. Prof. of

I express my deepest sense of gratitude to Dr. LAKSHMANAN M.P, Asst. Prof. of

6 BIBLIOGRAPHY AND APPENDIX 61 – 64

1) To identify the factors affecting customer satisfaction on Internet Banking service

SIGNIFICANCE OF THE STUDY

1. Demographic Profile of Respondents

Random Sampling Method is used for selecting the Sample Unit.

Tools used for analysis

In statistics, the two-way analysis of variance (ANOVA) is an extension of the one-way

LIMITATIONS OF THE STUDY

1. Selected Sample is limited to 100. Hence findings cannot be generalized.

Internet Banking is a product of e-commerce in the field of banking and financial

There is no definite answer as to which approach is appropriate. Perhaps it depends on the

3.2 Internet Banking: The Indian Scenario:

3.2.1 The entry of Indian banks into Net Banking:

3.2.2 Products and services offered

3.3 Internet Banking and its various types:

2) E-cheques (Online Fund Transfer)

3) Bill Payment Service

4) Requests and Intimations

5) Demat Account share trading.

Bill Presentment and Payment:

1. Online Payment for Shopping done on Internet.

2. ATM (Automatic Teller Machine)

5. Payment Cards (Debits/Credit Card)

3.3.3 Factors Responsible for Growth of Internet Banking:

Numerous factors including competitive cost, customer service, and demographic

Round the Clock Access:

Definition and features of independent variables

Safety and Security

How can I tell if a web page is secure?

What exactly do we mean by "secure"?

How can I tell if a web page is secured?

There are two general indications of a secured web page:

1) Check the web page URL

2) Check for the "Lock" icon

Description of security features in Internet Banking

The analysis is presented in five parts

1. Demographic profile of respondents

DEMOGRAPHIC PROFILE OF RESPONDENTS

4.2 Reason for Using IB Services

Using of IB services is influenced by many factors. It might be because of speed,

Friedman test is used to test the following hypothesis.

The test results are presented in the following table.

The chi-square static provides a value of 51.912, which is significant at 5 percent

4.3 Customer Satisfaction on IB Service Quality

4.3.1 Two-Way Anova of Transaction efficiency (TE) by Gender and Education

4.3.2 Two-Way Anova of Reliability by Gender and Education Qualification

4.3.4 Two-Way Anova of Customer Support (CS) by Gender and Education

4.3.5 Two-Way Anova of Ease of Use (EU) by Gender and Education