Customers' Perception Towards E-Banking Services of The Commercial Banks in Cuddalore District

CUSTOMERS' PERCEPTION TOWARDS E-BANKING SERVICES
OF THE COMMERCIAL BANKS IN CUDDALORE DISTRICT
_______________________________________________________
Introduction
In the history of mankind, there have been some revolutionary

technological changes, which radically changed the lifestyle, improved the living
standards of human beings and started a new era. The information age has ushered
in knowledge-based industrial revolution. Information technology shrunk the
world as a result of which time and distance have become non-entities to a large
extent. The success of the banking is depends largely on the quality services that
they provide to their customers. In the era of information technology, electronic
banking has become one of the most revolutionized components of today’s
economic growth. With the proliferation of internet and computer usage, e-
banking has become ideal for banks to meet customer’s expectations. The famous
quote by Bill Gates is “banking is vital to healthy economy, but banks themselves
are not highlighting the crucial nature of the electronic forces that are affecting
banks more than any other financial service provider group”.
The concept of banking has drastically changed from a business dealing

with money transactions alone to a business related to information on financial
transactions. The new methods of banking practices on account of information
technology ensure which service besides reducing cost in banking sector.
Computerization in banking is taking place all over the world. The purpose of
computerization is to bring technology to counter and enable employees to give
information at their fingertips. After the internet penetration, the banking sector
has undergone a huge revolution. Internet banking is changing the banking
industry and is having major effects on banking relationships. Banking is now no
longer confined to the branches where one has to approach the branch in person, to
withdraw cash or deposit a cheque or request a statement of accounts.
Concept of Electronic Banking
There are not many inventions that have changed the business of banking as
quickly as the e-banking revolution. World over banks are reorienting their
business strategies towards new opportunities offered by e-banking. Due to the
absolute transparency of the market, client can compare the services of various
banks more easily. For instance, on the internet, competitors are only one click
away. If clients are not happy with the products, prices or services offered by
particular bank, they are able to change their banking partner much more easily
than in the physical or real bank-client relationship. From the bank’s point of
view, use of the internet has significantly reduced the physical costs of banking
operations.
The development of integrated, customized financial services is becoming

an active area of competition between financial sector organizations. Web-based
services have to be more convenient, easier to use, and less expensive than the
alternative, to win the loyalty of consumers. The internet enables banks to offer
low cost, high value added financial services. Banks are finding that a
comprehensive online banking strategy is essential for success in the increasing
competition and changes in technology and life styles have changed the face of
banking and banks in the present environment are seeking alternative way to
provide and differentiate their services.
Drivers of the E-Banking Services

The increasing amount of information on the internet and changes in social
behaviour has increased the use of e-banking services considerably. These changes
resulted growth in users with sophisticated needs. Further, legislation has
increased customers’ rights and technology and competition have increased their
choice of products and providers. Moreover, to succeed in the e-banking arena,
banks were transformed their internal foundations to be more effective. Security,
which may include protection of consumers’ personal data and safe transactions to
prevent frauds, is also paramount for the growth of any sort of online trade,
including e-banking.
The internet has been integrated with other channels such as ATMs and
internal systems to increase its effectiveness. The idea of channel integration was
therefore supported by many others. The provision of a pleasant experience on this
channel is one of the key factors for success of the channel. Provision of
infrastructural facilities is another factor that could lead to quicker diffusion of
innovation. Product information content on the web design and layout are
important factors that affect customer satisfaction. Therefore, banks usually feed
their websites with content such as corporate profile, product and pricing
information, interest rates, application forms, etc. beyond the usual contents and
make their websites far richer in terms of functionality, to attract a larger number
of visitors. More people having access to internet are another factor that
determines the demand for e-banking services. Moreover the cost and speed of
internet connections have also been argued to be important elements. The
customer confidence on e-banking transactions is yet another factor. This depends
on how the banks would deal with any erroneous transactional and security
concerns that may occur during online banking.
Customers’ Perception towards e-banking services of the commercial banks

Customers’ perception with respect to motivating factors that induce the
customers to prefer E-banking services is as follows;
Motivating Factors to Prefer E-banking Services
There are several factors, which motivate the customers of the commercial banks
to prefer e-banking services. The staff of the banks and their friends and relatives
encourage customers to use e-banking services by explaining to them the advantages
of e-banking. The following table depicts the motivating factors of the respondents to
prefer e-banking services of the commercial banks in Cuddalore district.
TABLE 1
Respondents’ Motivating Factors to Prefer E-banking Services
Motivating Factors No. of Respondents Percentage
Easy and convenient access 189 42.00
Confidentiality 231 51.33
Service quality 240 53.33
Time saving 265 58.89
Transparency 197 43.77
Accuracy 245 54.44
Cost saving 321 71.11
Ubiquity 147 32.66
Speed 321 71.33
Social status 129 28.67

Security 234 52.00
Control over funds 123 27.33
Time out feature 271 60.22
Exchange of information 249 55.33

Source: Primary Data.
Easy and convenient access, confidentiality, service quality and time saving are
the factors influencing the respondents to prefer e-banking services at 42%, 51.33%,
53.33%, and 58.89% respectively in Cuddalore district. 43.77%, 54.44%, 71.11%,
32.66%, and 71.33% of the respondents are influenced by factors such as
transparency, accuracy, cost saving, ubiquity, and speed respectively to prefer e-
banking services of the commercial banks. Social status, security, control over funds,
time out feature and exchange of information are the motivating factors for the
customers at 28.67%, 52%, 27.33%, 60.22% and 55.33% respectively to prefer e-
banking services of the commercial banks in Cuddalore district.
The above table (Table 1) and analysis show that, Easy and convenient access,
confidentiality, service quality and time saving are the factors influencing the
respondents to prefer e-banking services at 42%, 51.33%, 53.33%, and 58.89%
respectively. 43.77%, 54.44%, 71.11%, 32.66%, and 71.33% of the respondents were
influenced by factors such as transparency, accuracy, cost saving, ubiquity, and speed
respectively to prefer e-banking services of the commercial banks. Social status,
security, control over funds, time out feature and exchange of information are the
motivating factors for the customers at 28.67%, 52%, 27.33%, 60.22% and 55.33%
respectively.
Conclusion
E-Banking is spreading all over the world with speed, sometimes at the cost of
throwing caution to the winds. This has not only transformed the banking and financial
institutions in their modern form, but has also brought a paradigm shift in their attitude to
banking operations. In India also, it has strongly impacted the strategic business
considerations for banks. It must be noted, however, that while e-banking provides many
benefits to customers and banks, it also aggravates traditional banking risks. Despite the
low diffusion of technology in India, the momentum of e-banking has picked up recently,
led by the foreign banks and the Indian private banks. It is evident from the present study
that a majority of the customers are highly satisfied with the e-banking services. The
customers prefer e-channels with time and cost utility which provide efficient services.
Moreover, banks are uncertain about the regulatory framework for conducting e-business
and taxation issues for governing cyberspace present formidable problems. Any
successful attempt at governing cyberspace will involve significant international
cooperation. Although there are some drawbacks in e-banking like complaints regarding
use of ATMs, high service charges and more working hours leading to frustration among
the employees but still the
e-banking is preferred as the efficiency of the employees working through e-channels is
better. If the study provokes the authority concerned to take some positive measures for
improving the effectiveness of e-banking, the researcher will feel amply rewarded.
References:
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Investigation of the Level of Users’ Acceptance of E-Banking in Nigeria,
Journal of Internet Banking and Commerce, April, Vol. 15, No.1.
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among Sophisticated Consumer Segments in an Advanced Developing
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232.
3. Aladwani, A.M (2001). Online Banking: A Field of Study Old Drivers,

Development Challenges and Expectations, International Journal of
Information Management , Vol. 21, No. 3, pp. 213-225.
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the Sultanate of Oman: An Exploratory Study, Journal of Internet Banking
and Commerce, Vol. 2, July.
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Banking: Factor Analysis, The IUP Journal of Management Research, Vol.
IX, No. 6, pp. 6-19.
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Bill, Banking Finance, Vol. 13, No.7, July, pp. 12-13.
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CUSTOMERS' PERCEPTION TOWARDS E-BANKING SERVICES

OF THE COMMERCIAL BANKS IN CUDDALORE DISTRICT

In the history of mankind, there have been some revolutionary

The concept of banking has drastically changed from a business dealing

Concept of Electronic Banking

The development of integrated, customized financial services is becoming

Drivers of the E-Banking Services

Customers’ Perception towards e-banking services of the commercial banks

Motivating Factors to Prefer E-banking Services

encourage customers to use e-banking services by explaining to them the advantages

prefer e-banking services of the commercial banks in Cuddalore district.

Motivating Factors No. of Respondents Percentage

Easy and convenient access 189 42.00

Confidentiality 231 51.33

Service quality 240 53.33

Time saving 265 58.89

Transparency 197 43.77

Accuracy 245 54.44

Cost saving 321 71.11

Ubiquity 147 32.66

Speed 321 71.33

Social status 129 28.67

Control over funds 123 27.33

Time out feature 271 60.22

Exchange of information 249 55.33

53.33%, and 58.89% respectively in Cuddalore district. 43.77%, 54.44%, 71.11%,

32.66%, and 71.33% of the respondents are influenced by factors such as

transparency, accuracy, cost saving, ubiquity, and speed respectively to prefer e-

customers at 28.67%, 52%, 27.33%, 60.22% and 55.33% respectively to prefer e-

banking services of the commercial banks in Cuddalore district.

respondents to prefer e-banking services at 42%, 51.33%, 53.33%, and 58.89%

respectively to prefer e-banking services of the commercial banks. Social status,

successful attempt at governing cyberspace will involve significant international

the employees but still the

e-banking is preferred as the efficiency of the employees working through e-channels is

1. Adesina Aderonke, A and Ayo Charles, K (2010). An Empirical

2. Akinci, S, Aksoy, S and Atilgan, F (2004). Adoption of Internet Banking

3. Aladwani, A.M (2001). Online Banking: A Field of Study Old Drivers,

4. Al-Sabbagh and Molla, A (2004). Adoption and Use of Internet Banking in

5. Ambiga Devi, P and Malarvizhi, V (2010). Customers’ Perception of E-

6. Anabil Bhattacharya (2000). E-Banking: It’s Prospects after Passing of IT

7. Antovski Lj and Gusev, M (2001). E-Banking-Developing Future with

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