Many organizations today have responded to the competitive business environment by implementing e-business as part of their business strategies. With the growth of the internet, it is inevitable for banks to move towards providing online banking for their customers. Although the current branch based retail banking remains the most common method for conducting banking transactions, internet technologies has changed the way personal financial services are designed and delivered to customers.
Shih and Fang (2004) describe internet banking as a new type of information system that uses the innovative resources of the internet and WWW (World Wide Web) to enable customers to effect financial activities in virtual space. For example, it allows customers to perform a wide range of banking transactions electronically via the bank’s web site. Early online banking web sites contained mainly product and service information for their customers. However, with the development of asynchronous and secured electronic transaction technologies, more banks are now using online banking both as a transactional as well as an informational medium.
As a result, registered internet banking users can now perform common banking transactions such as writing cheques, paying bills, transferring funds, printing statements, setting up fixed deposits, purchasing investment related funds and enquiring about account balances.
Internet banking has evolved into a “one stop service and information unit” that promises great benefits to both banks and consumers. Internet banking works the same way as the traditional banking services. The main difference is that customers are accessing their account and information, making payments and reconciling statements by using their computer rather than paper to complete the transactions. Internet banking services are crucial elements for the long-term survival of banks in the world of electronic commerce. The market for internet banking is