Impact of Internet Banking System and Technology on Indian Banks

Running head: INTERNET BANKING
Impact of Internet Banking System and Technology on Indian Banks
Name of the Student
Name of the University
Author Note

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Abstract
The banking sector will be successful and will survive if they can maintain their customers and
broaden their base of customers as well. The satisfaction of the customers also plays an
important part, as it will help the bank in retaining its customers, which will help in increasing
their profits and result in better performance for the banks. The use of technology has changed
the perception of the people, as it has helped them in carrying out their work in an easy manner.
The banking sector has also adopted the latest technologies that are available to them so that it
can make the work easy for the customers as well as for its employees. The customers in the
current scenario are shifting from the approaches that are present in traditional banking methods
to the modern day practices of banking systems. This has helped in reducing their costs and
being more effective towards the customers.
This study has been conducted in five chapters. The first chapter contains the background of the
study along with the aims and questions and hypothesis that will help in carrying out the research
in an efficient manner. The second chapter deals with the review of literature that has been
presented by different authors and scholars so that it can help the researcher in completing the
study in an appropriate manner. The third chapter contains the methods that have been used by
the researcher so that the process of research can be conducted in a better manner. The fourth
chapter contains the analysis, which has been conducted by the researcher so that it can provide a
better recommendation for the banks and its customers. The fifth chapter consists of the
recommendation and conclusion, which has been gathered after the researcher has got the
responses and conducting the test with the help of software.

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Acknowledgment
I would also like to take this opportunity to thank my professor without whose, constant support
and guidance, the research would not have been possible.
Firstly, I would like to thank God the Almighty in giving me the strength and courage without
which I could not have completed the entire study. Secondly, I would like to thank my family
and relatives who gave me constant support mentally and physically so that I can complete the
study on time. Lastly, I would like to give thanks to my peers and the friends who have helped
me in providing the appropriate information throughout the project and helped me in doing the
in-depth analysis of the research. Without their proper guidance, it is impossible for me to
complete the project.
Thanks and Regards,
Yours Sincerely,

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Table of Contents
Chapter 1: Introduction....................................................................................................................5
Background of the study..............................................................................................................5
Aim of the project........................................................................................................................7
Details of the research.................................................................................................................7
Justification of the topic...............................................................................................................8
Assistance to the organization.....................................................................................................8
Research questions.......................................................................................................................8
Research Hypothesis....................................................................................................................8
Chapter 2: Literature Review.........................................................................................................10
Internet Banking........................................................................................................................10
Trust...........................................................................................................................................11
Quality of service.......................................................................................................................12
Perceived ease of use.................................................................................................................13
Perceived usefulness..................................................................................................................14
Customer satisfaction.................................................................................................................15
Impact of e-banking on the customers.......................................................................................16
Chapter 3: Research Methodology................................................................................................19
Approaches for the study...........................................................................................................19
Research method used...............................................................................................................20

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Quantitative method...................................................................................................................20
Qualitative method.....................................................................................................................21
Project content...........................................................................................................................21
Data collection...........................................................................................................................21
Analysis of the data...................................................................................................................22
Types of investigation................................................................................................................22
Research Philosophy......................................................................................................................23
Justification of the investigation type used................................................................................24
Chapter 4: Analysis and Findings..................................................................................................25
Chapter 5: Conclusion and Recommendation...............................................................................49
Findings.....................................................................................................................................49
Limitations.................................................................................................................................50
Recommendations......................................................................................................................50
Reference List................................................................................................................................52
Appendix........................................................................................................................................56

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Chapter 1: Introduction
Background of the study
The introduction of the technological advances has helped in the field of information
technology with respect to the banking industries on a global basis, as it has reduced the degree
pressure up on the consumers. The development in the field of telecommunications along with
the electronic processes of data has also helped in adopting these changes by using the latest
technologies in the banking business. The level of competition has also increased, as the method
has proved to be cheaper and effective towards the services that are provided by the banks to its
customers, as they are in need to avail the services of the banks at a faster rate (Krishna 2015).
The health and prosperity of any nation depends on the system of banking that the
country has so that it can help the customers in investing their money and trusting the services of
the bank. The rise of the commercial banks started in India after the country became
independent, which led to the formation of the Reserve Bank of India (RBI) so that the services
of the banks can be monitored in an efficient manner (Charfeddine and Nasri 2015). The rise in
the private and foreign banks along with the public sector banks has helped the customers in
availing the systems such as e-banking, t-banking and m-banking suggests that the banks have
come a long way forward. The banking sector that is present in India has come up a long way
and is undergoing continuous changes in its systems so that it can provide better services to its
customers. This will help the banks in satisfying the customers, which may lead to the retention
of the customers by the bank (George and Kumar 2014).
During the past years, it can be seen that the banks used to have large queues for paying
the utility bills or for depositing and withdrawing the cash from the banks. This has been reduced

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considerably with the onset of the technological advances within the banking systems. The
consumers of the bank have reduced their waiting times by a considerable amount, as the
transactions of the bank have been made easy with the use of technology. The banks in the
current scenario have utilized the facilities that are present online, which has helped them in
reducing the paper work that resulted in giving better responses to the customers. The banking
industry was one of the first sectors that had a major impact due to the adoption of the latest
technologies, which changes there interactive interface with the customers (Varaprasad,
Sridharan and Unnithan 2015).
The main advantage that the banks get due to this technique is that they can be available
to serve the customers on a regular basis. The perception of the customers and the change in their
life style of the people has helped in the growth of the banking system. The analysis of the
attitudes of the customers towards the banking system has changed considerably because of the
use of advanced technologies (Kumar Sharma and Madhumohan Govindaluri 2014).
The banking sector has been undergoing the changes since the early 1990s with respect to
the use of information technology and the development that is being seen in the electronic
commerce as well. These developments have proved to be a threat regarding the operations that
have been managed by the bank in a traditional manner. It can be seen that the use of the
payment system that is electronic in nature may over emphasize the system of payments within
the country because of the vast changes due to the advancements in technology. It can also be
seen that with the onset of the new technologies can lead to the changes in digital monetary
system by replacing it with fiduciary currencies (Paul, Mittal and Srivastav 2016).

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The rise in the multiple functions by the modern banks has helped them in providing
better and more products and services to its customers with the primary objective of satisfying
the customers and increasing its profit ratio. The process of innovation has helped the banks in
adopting new technologies along with better methods in serving the products and services, which
had started during the 1950s before most of the industries adopted it. The use of automatic
machines was started by the banks of United States of America, which led to the development of
most of the countries in the years to come (Mittal and Agarwal 2016).
Aim of the project
The aim of the project is to study the factors that are as follows:
 The impact of internet banking offered by Indian banks to its customers
 How much internet banking has penetrated in the minds of the customers
 To gain insights about functioning of internet banking and technology
 To explore the future prospects of internet banking and technology
Details of the research
The project will deal with the perceptions that the customers have regarding the adopting
of the technology in the banking system. The rise in the use of technological advances in the
banks have helped the customers in interacting with the services of the banks in an efficient
manner, which has helped the banks in establishing customer satisfaction by providing better
services. The research paper will be conducted to study the objective of the perceptions of the
customers regarding the services of the bank such as the e-banking system.