ACCEPTANCE OF E-BANKING AMONG CUSTOMERS (An Empirical Investigation in India) K.T. Geetha1 & V.Malarvizhi2 Professor and Assistant Professor, Department of Economics, Avinashilingam Institute for home Science and Higher Education for Women Coimbatore -641043, TamilNadu, India 1 2
Abstract Financial liberalization and technology revolution have allowed the developments of new and more efficient delivery and processing channels as well as more innovative products and services in banking industry. Banking institutions are facing competition not only from each other but also from non-bank financial intermediaries as well as from alternative sources of financing. Another strategic challenge facing banking institutions today is the growing and changing needs and expectations of consumers in tandem with increased education levels and growing wealth. Consumers are becoming increasingly discerning and have become more involved in their financial decisions. This paper investigates the factors which are affecting the acceptance of ebanking services among the customers and also indicates level of concern regarding security and privacy issues in Indian context. Primary data was collected from 200 respondents through a structured questionnaire. Descriptive statistics was used to explain demographic profile of respondents and Factor and Regression analyses were used to know the factors affecting e-banking services among customer in India. The finding depicts many factors like security and privacy and awareness level increased the acceptance of e-banking services among Indian customers. The finding shows that if banks provide them necessary guidance and ensure safety of their accounts, customers are willing to adopt e-banking, Keywords: Security, Privacy, Awareness, Customers, E-banking INTRODUCTION The rapid advancement in electronic distribution channels has produced tremendous changes in the financial industry in recent years, with an increasing rate of change in technology, competition among players and consumer needs (Hughes, 2001). The proliferation of, and rapid advances in, technology-based systems, especially those related to the internet, are leading to fundamental changes in how companies interact with customers (Ibrahim et al, 2006; Bauer et al., 2005; Parasuraman and Zinkhan, 2002). Internet banking has become the selfservice delivery channel that allows banks to provide information and offer services to their customers with more convenience via the web services technology The evolution of e-banking has fundamentally transformed the way banks traditionally conduct their businesses and the ways consumers perform their banking activities (Eriksson et al., 2008; Sayar and Wolfe, 2007). Today e-banking has experienced phenomenal growth and has become one of the main avenues for banks to deliver their products and services (AmatoMcCoy, 2005). Electronic banking (e-banking), also known as Internet banking is defined as the automated delivery of new and traditional banking products and services directly to customers through electronic, interactive communication channels (Daniel, 1999; Sathye, 1999). E-banking includes the systems that enable financial institution customers, individuals or businesses, to access accounts, transact business, or obtain
2 | Journal of Management and Science
information on financial products and services through a public or private network, including the internet. Customers access ebanking services using an intelligent electronic device, such as a personal computer (PC), personal digital assistant (PDA), automated teller machine (ATM), kiosk, or Touch Tone telephone. Chou and Chou (2000) identified five basic services associated with online banking: view account balances and transaction histories; paying bills; transferring funds between accounts; requesting...