SRI VASAVI ENGINEERING COLLEGE

(Affiliated to Jawaharlal Nehru Technology University Kakinada, Kakinada)

DEPARTMENT OF MANAGEMENT STUDIES

CERTIFICATE

This is to certify that Mr.CH. V. N. KRISHNA SATISH student of MBA in Sri Vasavi
Engineering College has undergone mini project “A STUDY ON USAGE OF INTERNET
BANKING“ With Special reference to STATE BANK OF INDIA.

Signature of Guide HOD

Department of Management Studies

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 DECLARATION

I, CH. V. N. KRISHNA SATISH, hereby declare that this project report entitled “A STUDY
ON USAGE OF INTERNET BANKING" is submitted by me, to SRI VASAVI
ENGINEERING COLLEGE, Tadepalligudem (AFFILIATED TO JAWAHARLAL NEHRU
TECHNOLOGICAL UNIVERSITY), in partial fulfillment for the award of the degree of
MASTER OF BUSINESS ADMINISTRATION.

Place: Tadepalligudem

Date: (CH.V.N.KRISHNA SATISH)

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 “A STUDY ON USAGE OF INTERNET BANKING“

(With Special Reference to STATE BANK OF INDIA)

In partial fulfillment of the requirements for the award of the Degree

Of

Master of Business Administration

Submitted by

CH.V.N. KRISHNA SATISH

Enrollment No

18A81E0013

Under the guidance of

V. KIRAN KUMAR

ASSITANT PROFESSOR

SRI VASAVI ENGINEERING COLLEGE

(Affiliated to Jawaharlal Nehru Technology University, Kakinada)

DEPARTMENT OF MANAGEMENT STUDIES

Pedatadepalli, Tadepalligudem, West Godavari

2018-2020
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 CONTENTS

CHAPTER DETAILS PAGE NO.

1 INTRODUCTION 5
1.1 Scope of the Study 6
1.2 Need for the Study 6
1.3 Objectives of the Study 7
1.4 Data Collection 7
1.5 Limitations 8
2 INDUSTRY PROFILE 9-24
2.1 Company Profile 11-22
2.2 SWOT Analysis 23, 24
3 DATA ANALYSIS 25
4 FINDINGS & SUGGESTIONS 26
5 CONCLUSION 27
6 BIBILIOGRAPHY 28

Dr. G.V. Subba Raju

Head – Dept., of MBA

Copy to:
 Principal
 MBA staff
 Exam section

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 1. INTRODUCTION

INTERNET BANKING (E-BANKING):

Internet banking (or E-banking) means any user with a personal computer
and a browser can get connected to his banks website to perform any of the virtual banking
functions. In internet banking system the bank has a centralized database that is web-
enabled. All the services that the bank has permitted on the internet are displayed in menu.
Any service can be selected and further interaction is dictated by the nature of service. Once
the branch offices of bank are interconnected through terrestrial or satellite links, there would
be no physical identity for any branch. It would a borderless entity permitting anytime,
anywhere and anyhow banking.

The delivery channels include direct dialup connections, private networks, public networks,
etc. with the popularity of computers, easy access to Internet and World Wide Web (WWW),
Internet is increasingly used by banks as a channel for receiving instructions and delivering
their products and services to their customers. This form of banking is generally referred to
as Internet Banking.

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1.1) SCOPE OF THE STUDY

The study is made taking consideration of whole State Bank of India. With reference to
experience availed at Ganapavaram branch.

1.2) NEED FOR THE STUDY

• To get aware of various aspects of net banking

• To build up SWOC analysis of Internet banking of SBI

• To build up various solutions

This study is needed to find out the working of Internet Banking of SBI and its importance to
customer as well as to bank.

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1.3) OBJECTIVES OF THE STUDY

 To understand the genesis and concept of Internet Banking

 To analyze the trend of Internet Banking
 To know the SWOT analysis of Internet Banking

1.4) DATA COLLECTION

Secondary Data:

 Books and magazines

 Database at SBI

 Internal reports of the banks

 Library research

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1.5) LIMITATIONS

• The data available for the industry analysis was gathered only through secondary source
and calculation that were made with certain assumptions.

• According to a report from CNET, an estimated 48 million Americans used online

banking in some capacity in 2009 and that number is expected to increase to 63 million
in 2014.

• Time is major factor for collection of information.

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 2. INDUSTRY PROFILE

The concept of Internet banking has been simultaneously evolving with the development of
the World Wide Web. Programmers working on banking data bases came up with ideas for
online banking transactions, sometime during the 1980's. The creative processes of
development of these services were probably sparked off after many companies started the
concept of online shopping. The online shopping promoted the use of credit cards through
Internet. Many banking organizations had already started creating data ware housing facilities
to ease their working staffs. The development of these data bases were widely used during the
development of ATM's.

The first online banking service in United States was introduced, in October 1994. The service
was developed by Stanford Federal Credit Union, which is a financial institution. The online
banking services are becoming more and more prevalent due to the well developed systems.
Though there are pros and cons of electronic cash technology, it has become a revolution that
is enhancing the banking sector.

DEVELOPMENT OF INTERNET BANKING IN INDIA:

• The concept of Internet banking has been simultaneously evolving with the
development of the World Wide Web.

• Programmers working on banking data bases came up with ideas for online banking
transactions, sometime during the 1980's.

• The online shopping promoted the use of credit cards through Internet.

• The first online banking service in United States was introduced, in October 1994.

• The online banking services are becoming more and more prevalent dueto the well
developed systems

• ICICI was the first bank to initiate the Internet banking revolution in India as early as
1997 under the brand name
• ICICI Bank kicked off online banking way back in 1996. But even for the Internet as
a whole, 1996 to 1998 marked the adoption phase, while usage increased only in
1999- due to lower ISP online charges, increased PC penetration and a tech-friendly
atmosphere

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Use of internet banking from last few years

Although, the growth shows a healthy 10% increase from 2008 to 2009 from 57 million
users to 71 million Internet users, in larger perspective this is really nothing to boast of.
To put things in perspective, we are adding close to 15 million mobile users on average
in a month, while in case of Internet it is 14 million users a year.

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2.1) Company profile

STATE BANK OF INDIA

State bank of India is the nation’s largest and oldest bank. Tracing its roots back some 200
years to the British East India
Company (and initially established as the

Bank of Calcutta in 1806), the bank operates more than 15,000 branches within India, where it
also owns majority stakes in six associate banks. State Bank of India (SBI) has more than 80
offices in nearly 35 other countries, including multiple locations in the US, Canada, and
Nigeria. The bank has other units devoted to capital markets, fund management, factoring and
commercial services, credit cards, and brokerage services.
The Reserve Bank of India owns about 60% of State bank of India.

HISTORY OF STATE BANK OF INDIA:-

The History of State Bank Of India dates back to the first decade of the nineteenth century
with the setting up of Bank of Calcutta in Calcutta on 2 June 1806.After three years it was
renamed as Bank Of Bengal (2 January
1809).On 15th April 1840, the Bank of Bombay was initiated and on 1st July 1843, the Bank
of Madras was established. The integration of the three banks resulted in the creation of
Imperial Bank of India on 27th January1921.

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Structure and Organization

The Banks Corporate Office is located at Mumbai. Its domestic operational area is divided into
14 Circles, each with one Local Head Office and a few Zonal and Regional Offices. The Bank
is present not just in the major
metropolises of India but has wide reach in the villages of India. The Bank's top management
consists of the Chairman, group executives for National Banking Group, Corporate Banking
Group, International Banking Group and Associates & Subsidiaries, and four staff
functionaries in charge of finance, credit, human resources & technology management and
inspection
& audit

Transformation in SBI

The SBI has undergone major transformation in the recent years. The bank has ventured into
new areas of business like Pension Funds, General Insurance, Custodial Services, Private
Equity, Mobile Banking, Point Of Sale, Merchant Acquisition, Advisory Services, and
Structured Products etc.

The bank foresees tremendous growth potential in all these areas.

INTERNET BANKING AT STATE BANK OF INDIA

The Internet Banking service provided by State Bank of India is referred to as OnlineSBI by
the bank.

OnlineSBI is regarded as the Internet banking portal for SBI. The portal offers anywhere,
anytime, online access to banking services for SBI’s retail and corporate customers.
OnlineSBI is developed by using advanced technology and tools. The infrastructure is robust
and supports secure access to banking services for more than 13,000 branches across India.

OnlineSBI is made for all the customers who have an account at an internet enabled branch of
SBI. Customers with account with internet enabled branch require to get registered for the

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Internet banking service with the branch. In case the customer’s branch is not internet enabled,
he can transfer his existing account from his branch to an OnlineSBI branch. Apply for
OnlineSBI (Internet Banking)

In order to apply for OnlineSBI Online Banking, customers can visit the site at
“http://www.onlinesbi.com”and download the application form for
Online Banking. The form can also be obtained from the branch.

After completing the application form, it can be submitted to any nearest branch of the bank.
On successful processing of the application, customerwill receive User Id, Login Password and
Transaction password. Customer can login to net banking site of OnlineSBI using the UserID
and login password. Once logged in customer can avail many online banking services offered
by Bank and perform various financial transactions.

The User Id & Passwords for login to the OnlineSBI will be sent to the registered address of
customer with the Bank. Customer should ensure that his current address is updated in the
Bank’s record. It is suggested that new customers should completely read the general
information page so that they will get the idea of using the various banking services online. It
is very easy to conduct all the banking transactions online. It is useful for those who are
unfamiliar with online banking service.

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CHANGES BROUGHT IN INFORMATION TECHNOLOGY BY
SBI:

• In the next decade internet facility was provided for individuals

• All SBI branches w 2001 - KMPG appointed consultant for preparing IT Plan for the Bank.

• Later on Core banking proposed by the IT consultancy company.

• 2002 - All branches computerized but on decentralized systems, there the initiative of core
banking took place

• 2008- more than 6500 branches (95% of business) on Core Banking Solution (CBS) Internet
Banking facility for corporate customers were also launched in early 2008

• More Interfaces developed with e-Commerce & other sites through alternate channels like
ATM& Online Banking

• All Foreign Offices were brought on Centralized Solution

• Large network is playing the role of backbone for connectivity across the country.

• Multiple Service Providers are providing the links BSNL, MTNL, Reliance, Tata & reliance
which are making the system errorless and provide high speed.

• Multiple Technologies to support the networking infrastructure - Leased lines, Dial-up,

CDMA & VSAT

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INTERNET BANKING FACILITY THROUGH STATE BANK OF INDIA:.
1.24x7 facilities for tax payment through SBI e-Tax.

2.Fund transfer between his own accounts.ere connected and ATM’S were launch accounts.

3.Access of accounts on real time 24x7x365 basis and downloading of account statements.

4.Transfer of fund to other accounts through third party transfer mode.

5.Transfer of funds to PPF and loan accounts

6 Payment of all kind of utility bills like Telephone bill payment. Credit card payment LIC
premium payment, Mutual f\Fund Payment, Electricity bill payment Mobile bill payments
etc listed on the site.

7 Booking of Railway and Air tickets online

8.Payments of Taxes viz Direct and indirect tax.

9.Transfer of money to any VISA Debit or Credit Card.

10 Online trading of shares by using 3 in 1 accounts.

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PRODUCTS AND SERVICES:-

1)E-ticketing:

You can book your railway, air and bus tickets online through online SBI.

• To book your train ticket, just log on to irctc.co.in and create an ID there at if you do not

have one. Submit your travel plan and book the tickets.

2)SBI e-tax:-

You can pay your taxes online through SBI E-Tax. This facility enables you to pay TDS,
Income tax, Indirect tax, Corporation tax, Wealth tax, Estate Duty and Fringe Benefits tax.
Click the e-Tax link in the home page. You are displayed a page with two links Direct
Tax and Indirect Tax. Click the Direct Tax link. You will be redirected to the NSDL site
where you can select an online challan based on the tax you wish to pay. Provide the PAN,
name and address, assessment year, nature of payment and bank name. On selecting the bank
name as SBI and submitting the form, you will be redirected to the Internet Banking site. After
submitting the respective ID and password, you can select your account for making payment
of taxes. After payment is successful you can print the E-Receipt for the payment.

The E-receipt can be printed at a later date also and the same can be
retrieved from: Enquiries > Find Transactions > Status Enquiries > Click on the

respective transaction to print the tax receipt.

The Indirect Tax link is used to make Central Excise and Service Tax payments to Central
Board of Excise and Customs. The online payment feature facilitates anytime, anywhere
payment and an instant E-Receipt is generated once the transaction is complete. The Indirect
Tax payment facility is available to Registered Central Excise/Service Tax Assessee who

16
possesses the 15 digit PAN based Assessee Code. You can make CBEC payments using the
Indirect Taxes link available in the Payments/Transfers tab. You need to provide your Assessee
code as registered with CBEC and select the minor heads towards which you intend to pay tax.
Select the appropriate tax type and enter the tax amount. Select an account for debiting the
total tax amount. You can use any of your transaction accounts to make the payment. If a
payment is successful, CBEC provides a link to generate an E-Receipt for the payment.

3)Bill payment:

A simple and convenient service for viewing and paying your bills online. Using the bill
payment you can view and Pay various bills online, directly from your SBI account. You can
pay telephone, electricity, insurance, credit cards and other bills from the comfort of your
house or office, 24 hours a day, 365 days a year. Simply logon to https://www.onlinesbi.com/
with your credentials and register the biller to which you want to pay, with all the bill details.
Once the bill is uploaded by the biller, you can make payment online. You can see 'how do i'
to learn the steps for using the facility.

4) RTGS\NEFT:

You can transfer money from your State Bank account to accounts in other banks using the
RTGS/NEFT service. The RTGS system facilitates transfer of funds from accounts in one
bank to another on a "real time" and on "gross settlement" basis. This system is the fastest
possible interbank money transfer facility available through secure banking channels in India.
RTGS transaction requests will be sent to RBI immediately during working hours post working
hours requests are registered and sent to RBI on next working day. You can also schedule a
transaction for a future date. You can transfer an amount of Rs.1 lac and above using RTGS
system.

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National Electronic Funds Transfer (NEFT) facilitates transfer of funds to the credit account
with the other participating bank. RBI acts as the service provider and transfers the credit to
the other bank's account.

5) eZtrade@SBI:

State Bank of India (SBI) in alliance with MotilalOswal Securities Limited and SBI Caps
Securities Limited (SSL) now introduces you to
'eZtrade@sbi', a State-of-the-Art online trading platform predominantly to cater to every
trading need (presently available to Indian Residents Only) and offers a truly world class
experience of online investing - anyplace, anytime. This service provides you with a 3-in-1
account which is an integrated platform of Bank Account, Demat Account and an Online
Trading Account to give you a convenient and paper free trading experience under one roof.
We provide online trading of shares of Companies listed on BSE and NSE. eZtrade@sbi will
let you trade from the comfort of your home or office through the Internet. Buying and selling
of shares is now just a click away. So go ahead and enjoy your fast, easy and hassle-free
online shares/securities trading experience with India's Largest Bank.

6)E-payment:-

You can pay your insurance premium, mobile phone bills and also you can purchase mutual
fund units by coming from the biller’s website and selecting state bank of India in the
payment option.

LIC PREMIUM: For paying premium of LIC policy logon to premium is due select State
Bank of India in the make payment option. SBI Mutual FUND: You can invest in the SBI
Mutual Fund schemes online. Logon towww.sbi mf.com and select the scheme in which you
want to make investment in the payment option select State Bank of India. CCAVENUES:
Enjoy shopping at the CCAvenue Shopping Mall and purchase from a wide variety of products
and services through CCAvenue Certified Vendors. Make payments for your purchases using
your Internet enabled SBI accounts

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7)Fund transfer:-

The Funds Transfer facility enables you to transfer funds within your accounts in the same
branch or other branches. You can transfer aggregating Rs.1 lac per day to own accounts in
the same branch and other branches. To make a funds transfer, you should be an active Internet
Banking user with transaction rights. Funds transfer to PPF account is restricted to the same
branch. Just log on to retail section of the Internet Banking site with your credentials and select
the Funds Transfer link under Payments/Transfers tab. You can see all your online debit and
credit accounts. Select the debit account from which you wish to transfer funds and the credit
account into which the amount is to be credited. Enter the amount and remarks. The remarks
will be displayed in your accounts statement for this transaction. You will be displayed the
last five funds transfer operations on your accounts. On confirming the transaction, you will
be displayed a confirmation page with the details of the transaction and the option to submit
or cancel the funds .

8)Third party transfer :-

You can transfer funds to your trusted third parties by adding them as third party accounts. The
beneficiary account should be any branch SBI. Transfer is instant. You can do any number of
Transactions in a day for amount aggregating Rs.1lakh.

To transfer funds to third party having account in SBI, you need to add and approve a third
party, you need to register your mobile number in personal details link under profile section.
You will receive a One Time SMS password on your mobile phone to approve a third party. If
you do not have a mobile number, third party approval will be handled by your branch. Only
after approval of third party, you will be able to transfer funds to the third party. You can set
limits for third party transactions made from your accounts or even set limits for individual
third parties.

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9)Demand Draft :-

The Internet Banking application enables you to register demand drafts requests online. You
can get a demand draft from any of your Accounts (Savings Bank, Current Account, Cash
Credit or Overdraft). You can set
limits for demand drafts issued from your accounts or use the bank specified limit

for demand drafts.

You can opt to collect the draft in person at your branch, quoting a reference to the transaction.
A printed advice can also be obtained from the site for your record.

Alternatively, you may request the branch to courier it to your registered address, and the
courier charges will be recovered from you. If you have any queries, kindly approach your
branch, quoting the reference number generated for the request.

10) Cheque Book Request :-

You can request for a cheque book online. Cheque book can be requested for any of your
Savings, Current, Cash Credit, and Over Draft accounts. You can opt for cheque books with
25, 50 or 100 cheque leaves. You can either collect it from branch or request your branch to
send it by post or courier. You can opt to get the cheque book delivered at your registered
address or you can provide an alternate address. Cheque books will be dispatched within 3
working days from the date of request.

Just log on to retail section of the Internet Banking site with your credentials and select the
Cheque Book link under Requests tab. You can view all your transaction accounts. Select the
account for which you require a cheque book; enter the number of cheque leaves required and
the mode of delivery. Then, submit the same.

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11) Account Opening Request:-

OnlineSBI enables you to open a new account online. You can apply for a new account only in
branches where you already have accounts. You should have an INB-enabled account with
transaction right in the branch. Funds in an existing account are used to open the new account.
You can open Savings, Current, Term Deposit and Recurring

Deposit accounts of Residents, NRO and NRE types. Just log on to retail section of the Internet
Banking site with your credentials and select the New Account link under Requests tab. You
can see all types of accounts. Select the account and account type you wish to open and submit
the same. Then, you need to select the branch and enter the initial amount to open the account.
You can select any of your accounts for debiting the initial amount. Then, submit the
transaction. Your new account opening request will be processed by the branch.

12) Account Statement :-

The Internet Banking application can generate an online, downloadable account statement for
any of your accounts for any date range and for any account mapped to your username. The
statement includes the transaction details, opening, closing and accumulated balance in the
account. You can generate the online account statement for any date range or for any month
and year. The account statement can be viewed online, printed or downloaded as an
Excel or PDF file. You also have the option to select the number of records displayed in each
page of the statement. The options are 25, 50, 75, 100 and ALL.

13) Transaction Enquiry :-

OnlineSBI provides features to enquire status of online transactions. You can view and verify
transaction details and the current status of transactions. Your VISA transactions can also be

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viewed separately. Just log on to retail section of the Internet Banking site with your credentials
and select the Status Enquiry link under the Enquiries tab. You will be displayed all online
transactions you have performed. To view details of individual transactions, you need to click
the Transaction Reference number link. You are displayed the debit and credit account details,
transaction amount, narration and transaction status

14) Demat Account Statement:-

OnlineSBI enables you to view Demat account statement and maintain such accounts. The bank
acts as your depository participant. In the third party site, you can mark a lien on your Demat
accounts and use the funds to trade on stock using funds in your SBI savings account. You can
view Demat account details, and generate the following statements: statement of holding,
statement of transactions, statement of billing.

15)Donation:-

You can make donation to religious and charitable institution by using Internet Banking of
SBI. Simply log on tohttp://www.onlinesbi.com/ with your credentials and go to Payment and
transfer and click on make donation link. After selecting the debit account select the
religious/charitable institution whom you want to offer donation. After successful payment you
can print an E-receipt for the donation made.

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2.2) SWOTANALYSIS & TERMS OF SERVICE OF ONLINE BANKING

STRENGTHS:-

• Greater reach to customers

• Quicker time to market

• Ability to introduce new products and services quickly and successfully

• Ability to understand its customers’ needs

• Customers are given access to information easily across any location

• Greater customer loyalty

• Easy online application for all accounts, including personal loans and mortgage

• 24 hours account access

• Quality customer service with personal attention

WEAKNESSES:-

•Lack of awareness among the existing customers regarding

internet banking

•Obsolesce of technology take place very soon specially in terms of security on internet.

•Procedure for applying for id and password for using services related to internet banking takes
time.

•Lack of knowledge is found regarding internet banking in

employees of SBI

• Employees needs training to obtain knowledge regarding I-banking

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OPPORTUNITIES:-

• Approximately 95% of customers are not using internet banking.

• Core competency can be achieved in terms of banking if focus is made on awareness of

internet banking

• Can become 1st virtual bank of India.

• Concentration of various services should be made using internet banking

CHALLENGES:-

• Maintaining Business Edge over competitors in the context of sameness in IT

infrastructure

• Multiple vendor support is necessary for working of highly complex technology

• Maintaining secured IT infrastructure for business operations

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3) DATA ANALAYSIS

Purpose – This exploratory study is an attempt to present the present status of Internet
banking in India and the extent of Internet banking services offered by Internet banks. In
addition, it seeks to examine the factors affecting the extent of Internet banking services.
Design/methodology/approach – The data for this study are based on a survey of bank websites
explored during July 2008. The sample consists of 82 banks operating in India at 31 March
2007. Multiple regression technique is employed to explore the determinants of the extent of
Internet banking services. Findings – The results show that the private and foreign Internet
banks have performed well in offering a wider range and more advanced services of Internet
banking in comparison with public sector banks. Among the determinants affecting the extent
of Internet banking services, size of the bank, experience of the bank in offering Internet
banking, financing pattern and ownership of the bank are found to be significant. Research
limitations/implications – The primary limitation of the study is the scope and size of its sample
as well as other variables (e.g. market, environmental, regulatory etc.) which may have an
effect on the decision of the banks to offer a wide range of Internet banking services.
Originality/value – The purpose of the study is to help fill significant gaps in knowledge about
the Internet banking landscape in India. The findings are expected to be of great use to the
government, regulators, commercial banks, other financial institutions, e.g. co-operative banks
planning to offer Internet banking, bank customers and researchers. The bankers as well as
society at large will come to know where the banks lag in terms of adoption of Internet banking
and in providing different products and services. An understanding of the factors affecting the
extent of Internet banking services is essential both for economists studying the determinants
of growth and for the creators and producers of suchtechnologies.

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4)FINDINGS & SUGGESTIONS

FINDINGS:
 Most of the people are not fully aware of Internet Banking.
 Most of the employees are not showing morale.
 Dealing with the complaints raised by customers is not accurate and not in proper
manner.
 Non maintenance and other charges are very high as compared to other Banks.
 Existing customers should not know about the new products.

SUGGESTIONS:
 Advertising is not appropriate, as many people are not aware of internet banking
Therefore Hoarding and Boards should be displayed at various prime locations in the
city.
 Timely payment of salary and Promotion of employees will boost their morale.
 All the complaints of Customer should be deal in proper manner because it is the
customer who will give good or bad mouth about bank services.
 Non maintenance & other charges which are very high as compared to other Banks
should be reduced.
 Existing customer should always be informed about the new product.
 Proper training of Bank staff to give impressive presentation.

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5)CONCLUSION

Studying the project I came to know that Internet banking is clearly the way forward for the
State Bank of India. It provides comfort to customers at the same time it provides cost cutting
to SBI by eliminating physical documentation. Internet banking saves time of bank as well as
those of customers.

Study states that internet banking provides greater reach to customers. Feedback can be
obtained easily as internet is virtual in nature. Customer loyalty can be gain. Personal attention
can be given by bank to customer also quality service can be served. Bank should know that
No system is perfect, however a system of such a type will need to be very secure. This is a
system which holds account details and customers wealth. If such a system was not trusted
and not reliable, then SBI would face serious laws and would lose business.

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6)BIBLIOGRAPHY

Websites:-

•www.statebankofindia.com

•www.onlinesbi.com

•www.weikipedia.com

•www.eHow.com

•www.Indiatimes.com

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