E-Banking Project

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Research Journal of Management Sciences __________________________________________ISSN 2319–1171 Vol. 1(3), 20-24, October (2012) Res. J. Management Sci.

Internet Banking in India Consumer Concerns and Bank Marketing Strategies Sufyan Habib
AAII College, Barabanki, INDIA

Available online at: www.isca.in
Received 18th September 2012, revised 15th October 2012, accepted 17th October 2012

Abstract
Internet banking has attracted the attention of banks, securities trading firms, brokerage houses, insurance companies, regulators and lawmakers in developing nations since the late 1990s. With the rapid and significant growth in electronic commerce, it is obvious that electronic (internet) banking and payments are likely to advance. Researches show that impact of internet banking on cost savings, revenue growth and increased customer satisfaction on Industry is tremendous and can be a potential tool for building a sound strategy. However, it has raised many public policy issues before the banking regulators and government agencies. Interestingly, reliable and systematic information on the scope of internet banking in Indian context is still not sufficient, particularly what it means to the consumers and the bankers. The paper fills significant gaps in knowledge about the consumer’s perspective of Internet banking, trace its present growth and project the likely scenario. The paper presents the data, drawn from a survey of Internet banking consumers and the services providers (banks) that offer internet banking and develops a functional model for maximizing value to the consumers, which the banks may choose to adopt Internet banking strategically. The paper identifies the weaknesses of conventional banking and explores the consumer awareness, use patterns, satisfaction and preferences for internet banking vis-à-vis conventional form of banking and also highlights the factors that may affect the bank’s strategy to adopt Internet banking. It also addresses the regulatory and supervisory concerns of internet banking. Keywords: Internet banking, consumer expectation, traditional trends

Introduction
The objective of this paper is to examine the consumer behaviour with respect to internet banking vis-à-vis conventional banking, and to explore the possibility of blending these banking systems. The paper also suggests strategies to banks to maximize the value of services to consumers. The primary data used in the research consists of survey conducted on a sample of 2000 consumers arrived at using relative precision technique 1. The survey includes in major cities of India, instrument being questionnaires filled up from the consumers and personal interaction, discussions with the front line executives of online banking divisions of the major players, particularly their marketing and customer servicing departments and the banking experts, personal visits at Automated Teller Machine (ATMs), Point of Sale (POS) counters of major banks. The major assumptions in this research are – i. online banking is synonymous to Internet banking ii the behaviour of the surveyed population viz. consumers and bankers confirms to a normal distribution. The study limits itself to major cities given the fact that Internet Banking has no geographical boundaries2. Literature Review: Internet revolution is global phenomenon and going by the current growth statistics, India expects a spurt in the Internet penetration in coming years particularly in the electronic commerce. It is an obvious notion that electronic (internet) banking and payments are likely to advance more or less in tandem with e-commerce. Researches indicate that internet

banking has a significant impact on the business models of banks, securities trading firms, brokerage houses, insurance companies etc. Internet banking has also attracted the attention of, regulators and lawmakers in the developing nations since the late 1990s. Internet banking is a cause of concern to majority of...
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