Customers Perception towards E- Banking Services

A Project Report Submitted During Digital Marketing Course Of Post Graduate Diploma in Management (Approved b A!C"E# Govt$ o% !ndia& ('()' * '()+&

Submitted "o Dr Anag,a S,ukre Marketing C$airperson %MS& '$a(iabad

Submitted B Nitya ( !"#

DEC-A.A"!/0 % $ereby declare t$at t$e )ork entitled 1Customers Perception towards EBanking Services2 is carried out by us under t$e guidance of our $onorable *aculty Dr+ Anag$a S$ukre (Marketing C$airperson#+ ,$e )ork is done by us& best of our kno)ledge and belief- it contains no material pre.iously publis$ed or )ritten by anot$er neit$er person nor material )$ic$ $as accepted for t$e a)ard of any ot$er degree or diploma of t$e uni.ersity or ot$er %nstitute of $ig$er learning+

Nitya ( !"#

AC30/4-EDGEME0" % e/press our sincere gratitude to our $onorable *aculty Dr+ Anag$a S$ukre ( Marketing C$airperson# for $er guidance& continuous support and cooperation t$roug$out our project& )it$out )$ic$ t$e Project report )ould not $a.e been possible+

Nitya ( !"#

S$0o$ 0+ 1+ 2+ 4+ 3+ 9+ "+ :+ !+ 0 + 00+ 01+ 02+ 04+ 03+ 09+ Declaration Ackno)ledgement

"able o% Content

Page 0o$ 1 2 3 9 " : ! 0 00 01 02 02 04 0: 0! 1

Objecti.e of t$e study %ntroduction 5 6.olution of 67 8anking Need for 67 8anking 5 67 8anking Products ,ypes of 67 8anking Ad.antages of 67 8anking Disad.antages of 67 8anking ;o) 67 8anking Can ease your <ife %nternet 8anking in %ndia 6merging C$allenges Researc$ Met$odology Data Collection 5 SPSS Analysis Recommendation Conclusion Anne/ure

/b5ective o% t,e Stud ,$e Objecti.e of t$e study is to kno) about 67 8anking and its ser.ices+ ;o) many people actually a)are and using t$is ser.ice in t$eir li.es+ ,$e actual need of t$e 67 8anking ser.ices in today=s scenario+ ,$e recent c$allenges in 67 8anking Ser.ices+ %s 67 8anking ser.ice making t$e life easy or not>

!ntroduction %nternet 8anking (678anking# means any user )it$ a personal computer and a bro)ser can get connected to $is bank=s )ebsite to perform any of t$e .irtual banking function+ %n ot$er )ords it is said t$at it is updated ?online& real time@+ ,$e system is updated immediately after e.ery transaction automatically+ Online banking (67banking# allo)s customers of a financial institution to conduct financial transactions on a secure )ebsite operated by t$e institution& )$ic$ can be a .irtual bank+ ,o access a financial institutionAs online banking facility& a customer $a.ing personal %nternet access must register )it$ t$e institution for t$e ser.ice& and set up pass)ord for customer .erification+ 678anking is a result of t$e gro)ing e/pectations of bank=s customers+ 67banking or Online banking is a generic term for t$e deli.ery of banking ser.ices and products t$roug$ t$e electronic c$annels suc$ as t$e telep$one& t$e internet& t$e cell p$one etc+ ,$e concept and scope of e7banking is still e.ol.ing+ Se.eral initiati.es $a.e been taken by t$e 'o.ernment of %ndia as )ell as t$e R8% (Reser.e 8ank of %ndia#$a.e facilitated t$e de.elopment of e7banking in %ndia+ ,$e go.ernment of %ndia enacted t$e %, Act& 1 & )$ic$ pro.ides legal recognition to electronic transactions and ot$er means of electronic commerce+

Evolution o% E- Banking ,$e story of tec$nology in banking started )it$ t$e use of punc$ed card mac$ines like Accounting Mac$ines+ ,$e use of tec$nology& at t$at time& )as limited to keeping books of t$e bank+ %t furt$er de.eloped )it$ t$e birt$ of online real time system and .ast impro.ement in telecommunications during late0!" =s and 0!: =s+ %t resulted in a re.olution in t$e field of banking )it$ ?con.enience banking@+ ,$roug$ Con.enience banking& t$e bank is carried to t$e doorstep of t$e customer+ ,$e 0!! =s sa) t$e birt$ of distributed computing tec$nologies and Relational Data 8ase Management System+ %ntense competition $as forced banks to ret$ink t$e )ay t$ey operated t$eir business+ ,$ey $ad to rein.ent and impro.e t$eir products and ser.ices to make t$em more beneficial and cost effecti.e+ ,ec$nology in t$e form of 67banking $as made it possible to find alternate banking practices at lo)er costs+ More and more people are using electronic banking products and ser.ices because large section of t$e banks future customer base )ill be made up of computer literate

customer& t$e banks must be able to offer t$ese customer products and ser.ices t$at allo) t$em to do t$eir banking by electronic means+ 0EED 6/. E-BA03!0G One $as to approac$ t$e branc$ in person& to )it$dra) cas$ or deposit a c$eBue or reBuest a statement of accounts+ %n true %nternet banking& any inBuiry or transaction is processed online )it$out any reference to t$e branc$ (any)$ere banking# at any time+ Pro.iding %nternet banking is increasingly becoming a Cneed to $a.eC t$an a Cnice to $a.eC ser.ice+ ,$e net banking& t$us& no) is more of a norm rat$er t$an an e/ception in many de.eloped countries due to t$e fact t$at it is t$e c$eapest )ay of pro.iding banking ser.ices . Dit$ t$e popularity of PCs& easy access to %nternet and Dorld Dide Deb (DDD#& %nternet is increasingly used by banks as a c$annel for recei.ing instructions and deli.ering t$eir products and ser.ices to t$eir customers+ ,$is form of banking is generally referred to as %nternet 8anking+ E-Banking Products Automated ,eller Mac$ine (A,M) ,ele banking or P$one 8anking %nternet 8anking Mobile 8anking

Automated ,eller Mac$ineE ,$ese are cas$ dispensing mac$ine& )$ic$ are freBuently seen at banks and ot$er locations suc$ as s$opping centres and building societies+ ,$eir main purpose is to allo) customer to dra) cas$ at any time and to pro.ide banking ser.ices )$ere it )ould not $a.e been .iable to open anot$er branc$+ Fsing an A,M& customers can access t$eir bank accounts in order to make cas$ )it$dra)als (or credit card cas$ ad.ances# and c$eck t$eir account balances+ Many A,Ms also allo) people to deposit cas$ or c$ecks& transfer money bet)een t$eir bank accounts& pay bills& or purc$ase goods and ser.ices+ ,$e ad.antages of A,M to customers areE Ability to dra) cas$ after normal banking $ours Guicker t$an normal cas$ier ser.ice

"ele banking or P,one Banking7 %t is fastly becoming one of t$e most popular products+ Customer can perform a number of transactions from t$e con.enience of t$eir o)n $ome or office- in fact from any)$ere t$ey $a.e access to p$one+ Customers can do follo)ingE7 C$eck balances and statement information ,ransfer funds from one account to anot$er Pay certain bills

Mobile Banking7 A .ersatile multifunctional& free ser.ice t$at is accessible and .ie)able on t$e monitor of mobile p$one+ !nternet Banking7 ,$e ad.ent of t$e %nternet and t$e popularity of personal computers presented bot$ an opportunity and a c$allenge for t$e banking industry+ *or years& financial institutions $a.e used po)erful computer net)orks to automate millions of daily transactions- today& often t$e only paper record is t$e customer=s receipt at t$e point of sale+ No) t$at t$eir customers are connected to t$e %nternet .ia personal computers& banks en.ision similar ad.antages by adopting t$ose same internal electronic processes to $ome use+ 8anks .ie) online banking as a po)erful ?.alue added@ tool to attract and retain ne) customers )$ile $elping to eliminate costly paper $andling and teller interactions in an increasingly competiti.e banking en.ironment+ %n %ndia first one to mo.e into t$is area )as %C%C% 8ank+ ,$ey started )eb based banking as early as august 0!!"+ "8PES /6 E-BA03!0G 0+ %nformational 1+ Communicati.e 2+ ,ransactional !n%ormationalE ,$is is t$e basic le.el of %nternet banking+ ,ypically& t$e bank $as marketing information about t$e bank=s products and ser.ices on a stand7alone ser.er+ ,$e risk is relati.ely lo)& as informational systems typically $a.e no pat$ bet)een t$e ser.er and t$e bank=s internal net)ork+ Communicative7 ,$e interaction bet)een t$e bank=s system and t$e customer+ ,$e interaction maybe limited to electronic mail& account enBuiry& loan applications& or static file updates+ 8ecause t$ese ser.ers may $a.e a pat$ to t$e
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bank=s internal net)orks& t$e risk is $ig$er )it$ t$is configuration t$an )it$ informational systems+ Appropriate controls need to be in t$e place to pre.ent& monitor& and alert management of any unaut$ori(ed attempt to access t$e bank=s internal net)orks and computer systems+ Hirus controls also become muc$ more critical in t$is en.ironment+ "ransactionalE ,$is le.el of %nternet banking allo)s customers to e/ecute transactions+ Since a pat$ typically e/ists bet)een t$e ser.er and t$e bank or outsourcer=s internal net)ork& t$is is t$e $ig$est risk arc$itecture and must $a.e t$e strongest controls+ Customer transactions can include accessing accounts& paying bills& transferring funds etc+

AD9A0"AGES /6 E-BA03!0G7 Con.enience ,ransaction speed FbiBuity 6fficiency 6ffecti.eness C$eaper alternati.e *rom snob .alue to necessity ConvenienceE 678ANI%N' a.ailable 14 $ours a day& se.en days a )eek& and t$ey=re only a mouse click a)ay+ :bi;uit : %f you=re out of state or e.en out of t$e country )$en a money problem arises& you can log on instantly to your online bank and take care of business& 14J"+ "ransaction speed: Online bank sites generally e/ecute and confirm transactions at or Buicker t$an A,M processing speeds+ E%%icienc 7 Kou can access and manage all of your bank accounts& from one secure site+
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E%%ectiveness: Many online banking sites no) offer sop$isticated tools& including account aggregation& stock Buotes& rate alert and portfolio managing program to $elp you manage all of your assets more effecti.ely+ Most are also compatible )it$ money managing programs suc$ as Buicken and Microsoft money+ C,eaper alternative: Dit$ increasing competition& it seems to be t$e cost factor t$at is dri.ing banks to offer t$e facility+ ,$e %nternet is still a .ery c$eap alternati.e to opening a p$ysical branc$+ ,$e costs of a banking ser.ice t$roug$ t$e %nternet form a fraction of costs t$roug$ con.entional met$ods+ 6rom snob value to necessit : A couple of years ago& t$ere )as a belief e.en among bankers t$at customers opening ne) accounts )anted t$e online banking facility& just to Cfeel goodC and .ery fe) of t$em actually used t$e ser.ices+ ,oday& bankers belie.e t$at t$e trend from Lnice to $a.eA is c$anging to Lneed to $a.eA+ ,$e Csnob .alueC of banking )it$ an organisation t$at could offer ser.ice on t$e %nternet $as gi.en )ay to a genuine necessity& $e feels+ C%t all depends on $o) busy a person is+C D!SAD9A0"AGES Start7up may take time <earning cur.es 8ank site c$anges

Start-up ma take timeE %n order to register for your bank=s online program& you )ill probably $a.e to pro.ide %D and sign a form at a bank branc$+ %f you and your spouse )is$ to .ie) and manage t$eir assets toget$er online& one of you may $a.e to sign a durable po)er of attorney before t$e bank )ill display all of your $oldings toget$er+ -earning curvesE 8anking sites can be difficult to na.igate at first+ Plan to in.est some time andMor read t$e tutorials in order to become comfortable in your .irtual lobby+ Bank site c,anges7 6.en t$e largest banks periodically upgrade t$eir online programs& adding ne) features in unfamiliar places+ %n some cases& you may $a.e to re7enter account information

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</4 E-BA03!0G CA0 EASE 8/:. -!6E *und transfer 8ill payment ser.ice Rail)ay pass %n.esting t$roug$ %nternet banking Rec$arging your prepaid p$one S$opping at your fingertips 6und trans%er7 Any amount can be transferred from one account to anot$er of t$e same or any anot$er bank+ Customers can send money any)$ere in %ndia+ Payee=s account number& $is bank and t$e branc$ is needed to be mentioned after logging in t$e account+ ,$e transfer )ill take place in a day or so& )$ereas in a traditional met$od& it takes about t$ree )orking days+ !nvest t,roug, !nternet bankingE *D can be opened online t$roug$ funds transfer+ No) in.estors )it$ interlinked demat account and bank account can easily trade in t$e stock market and t$e amount )ill be automatically debited from t$eir respecti.e bank accounts and t$e s$ares )ill be credited in t$eir demat account+ Moreo.er& some banks e.en gi.e t$e facility to purc$ase mutual funds directly from t$e online banking system+ No)adays& most leading banks offer bot$ online banking and demat account+ .ec,arging our prepaid p,oneE Nust top7up t$e prepaid mobile cards by logging in to %nternet banking+ 8y just selecting t$e operatorAs name& entering t$e mobile number and t$e amount for rec$arge& t$e p$one is again back inaction )it$in fe) minutes+ S,opping at our %ingertipsE <eading banks $a.e tie ups )it$ .arious s$opping )ebsites+ Dit$ a range of all kind of products& one can s$op online and t$e payment is also made con.eniently t$roug$ t$e account+ One can also buy rail)ay and air tickets t$roug$ %nternet banking+

!0"E.0E" BA03!0G !0 !0D!A

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%nternet banking products in %ndia into 2 types based on t$e le.els of access granted+ ,$ey areE %nformation Only System 6lectronic %nformation ,ransfer System *ully 6lectronic ,ransactional System

!n%ormation /nl S stem7 'eneral purpose information like interest rates& branc$ location& bank products and t$eir features& loan and deposit calculations are pro.ided in t$e banks )ebsite+ ,$ere e/ist facilities for do)nloading .arious types of application forms+ ,$e communication is normally done t$roug$ e7 mail+ ,$ere is no interaction bet)een t$e customer and bankAs application system+ No identification of t$e customer is done+

Electronic !n%ormation "rans%er S stem7 ,$e system pro.ides customer7 specific information in t$e form of account balances& transaction details& and statement of accounts+ ,$e information is still largely of t$e Aread onlyA format+ %dentification and aut$entication of t$e customer is t$roug$ pass)ord+ ,$e information is fetc$ed from t$e bankAs application system eit$er in batc$ mode or off7line+ ,$e application systems cannot directly access t$roug$ t$e internet+ 6ull Electronic "ransactional S stemE ,ransactions can be submitted by t$e customer for online update+ ,$is system reBuires $ig$ degree of security and control+ %n t$is en.ironment& )eb ser.er and application systems are linked o.er secure infrastructure+ %t comprises tec$nology co.ering computeri(ation& net)orking and security& inter 7bank payment gate)ay and legal infrastructure+ %t includes t$e follo)ingsE A,M D68%, CARDS SMAR, CARDS MO8%<6 8ANI%N'

EME.G!0G C<A--E0GES
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 Demand side pressure due to increasing access to lo) cost electronic ser.ices+ 'lobal players in t$e fray 'ro)ing customer a)areness and need of transparency Manage multiple distribution c$annels .esearc, Met,odolog

.esearc, Design7 A researc$ design is a frame)ork for conducting t$e marketing researc$ project+ %t specifies t$e details of t$e procedures necessary for obtaining t$e information needed to structure and sol.e marketing researc$ problem+ Step o% Design7,arget of populationE %MS students and some )orking professionals Si(e of sampleE 33 Sampling Met$odE =Non7probability sampling met$od 7 Con.enience sampling =ProbabilityOrandom sampling met$od 7 Stratified sampling+ 7Area sampling For this project we have selected as per the convenience (Convenience Sa plin!" #$S st%dents and so e wor&in! pro'essionals o' o%r contacts( Stratified means particular area& )e $a.e selected Dasna as a particular area+

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DA"A C/--EC"!/0 ",ere are two t pes o% data collection7 Primary data Secondary data

J*or t$e completion of t$is project )e $a.e taken only t$e $elp of t$e primary data as )ell as secondary data+

Primar DataE De $a.e collected Primary data regarding t$e perception to)ards e7banking ser.ices by filling t$e Buestionnaire in t$e %MS& Dasna locality of '$a(iabad+ And also Buestionnaire filled by some )orking professionals )$o )orked in Del$i 5 NCR+ Secondar DataE ,o kno) more about 678anking& its introduction& e.olution& c$allenges etc+ t$roug$ important )ebsites+ SPSS Anal sis >$ !s t,ere an training re;uired %or using banking transaction activit easil ? Solution7 Correlation

Descriptive Statistics Mean requires training to use E banking eas banking 3.02 3.!0 Std. Deviation 1.269 1.0"! N 55 55

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Correlations requires training to use E banking requires training to use E banking #earson $orre%ation Sig. &2'tai%ed) N eas banking #earson $orre%ation Sig. &2'tai%ed) N 55 .13! .315 55 55 1 eas banking .13! .315 55 1

!nterpretation7 ; E No relations$ip e/ists bet)een training reBuired and ease using banking transaction acti.ity ;0E Relations$ip e/ists Sample si(e P 33 QR 0S P 2+ 1R0+19! (reBuire training to use e7banking# P 9"T QR 0S P 2+: R0+ ": (easy banking acti.ity# P 9"T P .alue P +203 Greater t,an ($(@ ,$erefore& ; is accepted ,$us& no relations$ip e/ists bet)een training reBuired and easily using banking transaction acti.ity+

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>$ !s sa%et and securit o% transacting over t,e net# t,e most important %actor %or t,e use o% E- Banking services in dail li%e? Solution7 .egression

Variables Entered/ Removed 5ariab%es Mode% 1 Entered sa+et 0 se.urit transa.tion a a. )%% requested variab%es entered. b. De4endent 5ariab%e: E banking 4art o+ %i+e 5ariab%es (e-oved Met,od . Enter

Model Summary )d*usted ( Mode% 1 ( .1"3a ( Square .030 Square .012 Std. Error o+ t,e Esti-ate 1.161

a. #redi.tors: &$onstant)/ sa+et 0 se.urit transa.tion

ANOVAb Mode% 1 (egression (esidua% 3ota% Su- o+ Squares 2.202 "1.232 "3.636 d+ 1 53 52 Mean Square 2.202 1.32! 1 1.636 Sig. .20"a

a. #redi.tors: &$onstant)/ sa+et 0 se.urit transa.tion b. De4endent 5ariab%e: E banking 4art o+ %i+e

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Coefficients Standardi7ed 6nstandardi7ed $oe++i.ients Mode% 1 &$onstant) sa+et 0 se.urit transa.tion a. De4endent 5ariab%e: E banking 4art o+ %i+e 8 2.962 .1"2 Std. Error .2!2 .136 .1"3 $oe++i.ients 8eta t 6.139 1.2"9 Sig. .000 .20"

RUP + 2 represents coefficient of determination i+e+ 2T of t$e .ariation in 67 8anking ser.ices as a part of daily life is e/plained by safety 5 security transacting o.er t$e internet+ Standard 6rror of 6stimates (S66# estimates t$e de.iation around Regression <ine+ Regression P aRb/ Regression <ine P 1+!91(a# R +0"4(b#Jsafety 5 security As b is positi.e& relations$ip e/ists bet)een day to day life transaction and safety and security o.er t$e net+ ,est t$e significance of t$e relations$ip bet)een 67 8anking ser.ices as a part of day to day life and safety 5 security of transaction o.er t$e internet+ 6or t,is we use t- test ; E bP ;0E bV t .alue P 0+1" a (safety and security of transacting o.er t$e net# P .alue P +1 " 'reater t$an + 3 ,$erefore& ; is accepted No relations$ip e/ists bet)een safety 5 security o.er t$e internet and 67 8anking ser.ice part of daily life in general+
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.egression Model * test is used to determine t$e .alidity of Regression Model )$et$er t$e relations$ip e/ists or not * P 0+929 P .alue P +1 " D$ic$ is greater t$an + 3 So& Accept ; No Halid Regression Model+

.ecommendation7 0+ ,$ose people )$o open t$ere ne) aOc in t$e bank& t$e bank $as t$e responsibility to impose t$eir clients to start using 67 8anking ser.ices as t$ey impose t$eir sc$emes+ 1+ %f training is reBuired for t$ose )$o are not comfortable in using 67 banking ser.ices e+g+ Old age person& t$e bank $as to take t$e responsibility to pro.ide t$em training for 172 days+ Due to t$is practice& t$e cro)d )ill be less in t$e p$ysical bank and also fe)er employees are reBuired for t$e same job+

Conclusion
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67 8anking Ser.ice is still in a gro)ing p$ase in %ndia+ And face many c$allenges also+ As )e $a.e Buoted a Buestion t$at is security& an important aspect for using 67 8anking ser.ices+ ,$e result comes NO relations$ip t$at s$o)s many ot$er aspects are responsible for using t$is ser.ice+ And anot$er Buestion )e $a.e Buoted t$at is any training reBuired for increasing t$e use of 67 8anking Ser.ice+ ,$e SPSS ans)er is NO relations$ip t$at s$o)s only little bit information is enoug$ for using 67 8anking ser.ices+ 67 8anking ser.ice makes t$e life muc$ easier+

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AnneAure

Gender7 Age7

Male 1 72

*emale 2 74 8usiness Man 4 73 ,eac$er 3 5 abo.e Student

/ccupation7 Ser.ice Ot$er S$0o$ Particulars 0# 1# 2# 4# 3# 9# "# :# !# 0 #

(Rate7Strongly DisagreeE 0 to Strongly AgreeE 3# Strongl Agree Disagre Agree 0eutral e Strongl Disagree

% use e banking ser.ice for a)areness of t$e ser.ices 5 benefits %t is easy to make my banking transaction acti.ity ,$ere is safety 5 security of transacting o.er t$e internet %t is affordable ser.ice .ia internet(i+e+ bank c$arges# % )ill use t$is ser.ice for online paymentOs$opping Online Ser.ice used for seeking product 5 rate information ,$ere is no error )$ile using t$is ser.ice Fsing 6 banking ser.ice is more prestigious t$an Bueuing at t$e bank $all %t reBuires training to use 6 banking ser.ices 6 banking ser.ices are part of my daily life

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