An
Empirical Study on the Influence of Demographic Variables on E-Banking Services
R.
Vijayakumar1*, R. Radhakrishan2 and R. Anitha3
1SNS College of
Technology, Anna University of Technology, Coimbatore, India
2SNS Business
School, Coimbatore, India
3Faculty of
Management Studies, PPG Institute of Technology, Coimbatore, India
*Corresponding Author E-mail: vijayjones@gmail.com
ABSTRACT:
Business
Enterprise has been globalised with revolutions from the E-banking and the way
banking transactions are done. The cost of delivering banking services
and products has substantially reduced by using E-Banking channels than
traditional channels. This has encouraged the Banks for technological change at
a faster pace and across the geography. E-banking technologies have proliferated in recent
years, and the availability of a wide range of products has led to increasing
adoption among consumers. The objectives of the research established revolve
around the selected demographic variables like education, age, occupation and
monthly income with regard to the satisfaction level of the respondents. The
main finding of the study was that among the various demographic variables,
only occupation and income of the banking customers influenced their
satisfaction level significantly towards e-banking services
KEYWORDS: E-Banking, customer attitude, customer perception,
technology acceptance, demographic profiles
During the last two decades E-business has
been growing continuously as a sunrise industry. From the forefront the banking
industry has been leading along with telecom. With technology and e-business,
the banking industry has taken banking transactions to a new level. All banking
transactions completing through internet applications is called e-banking.
The
way the financial affairs are conducted, both personal and business has changed
radically in the last two decades, with advancement in technology (Bandura, 2002). Post
de-regulation, substantial resources has been invested in technology,
communications and networking to service the customers quickly and efficiently.
Technology based services; E-Banking was rendered to the customers.
E-banking is the newest delivery channel of
banking services. The definition of e-banking varies amongst researchers
partially because e-banking refers to several types of services through which
Bank’s customers can request information and carry out most retail banking
services via computer, television or mobile phone. E-banking can also be
defined as a variety of the following platforms:
• Internet banking (or online banking)
• Telephone banking
• TV-based banking
• Mobile phone banking
E-Banking can be defined as the remote
delivery of banking products and services through electronic channels, allowing
customers to access account specific information and conduct banking
transactions remotely. E-Banking products ranging from ATM
banking to Internet banking to Mobile Banking are at various stages maturity
levels and development. (Kolodinsky, Hogarth, and Hilgert, 2004).
Though
many benefits have accrued for the customers, the penetration of E-Banking in
India has not been to the level of the penetration of other technologies, say
Mobile technology. With irrelevance to
location and time, banking services can be accessed anywhere and anytime.
Lifestyles becoming increasing mobile it is all the more pertinent that
E-Banking be embraced.
Business Enterprise has been globalised with
revolutions from the E-banking and the way banking transactions are done.
E-banking technologies have proliferated in recent years, and the availability
of a wide range of products has led to increasing adoption among consumers.
These technologies include direct deposit, computer banking, stored value
cards, and debit cards.
The
cost of delivering banking services and products has substantially reduced by
using E-Banking channels than traditional channels. This has encouraged the
banks for technological change at a faster pace and across the geography. On
one side while it is cheaper to operate through Electronic Banking, it is also
convenient and easier for customers to conduct their banking transactions.
Most of the consumers who start banking
online do it because they need to pay bills frequently and would like to do it
with minimum effort. Besides that, people use the internet banking to keep an
eye on their money matters, view their account balance and check receiving
payments from other parties. E-banking technologies can be classified as either
‘passive’ or ‘active’. Passive technologies such as direct deposit do not
require behavioral changes on the part of the consumer. These innovations are
therefore more easily spread to the mainstream. Active technologies, like usage
of ATMs and Internet Banking on the other hand, require new behavior and are
therefore more challenging to propagate. E-banking requires perhaps the most
consumer involvement, as it requires the consumer to maintain and regularly
interact with additional technology such as a computer and internet connection.
In spite of being
a cost effective and efficient channel for delivery of banking services and
products, E-Banking still has some resistance, especially from the customers.
Consumers perceive and accept E-banking
in different ways. Perception and Acceptance is an individualistic factor based
on various factors like ease of use, prior technology training, locus of
control, demographic factors like education, age, occupation, and income.
Satisfaction leads to positive perception and acceptance. Contentment or
satisfaction is attained when the expected result is achieved. The fulfillment
of expectations and the nature and methodology of fulfillment will influence
the degree of satisfaction.
This research study analyses the extent
of impact that demographic factors would have on the satisfaction level of
E-Banking services.
It is presumed that e-banking preference is
affected by factors such as education, age, occupation, income etc. Therefore these
factors are paid importance to and are linked to e-banking to determine whether
they really do have an impact on the satisfaction level of e-banking services.
Thus, the objectives established revolve around the selected demographic
variables like education, age, occupation and monthly income with regard to the
satisfaction level of the respondents.
Hence the following hypotheses were framed:
H1: Education level of the bank customer
does not play a significant role in the satisfaction level of users of
E-Banking services.
H2: Age of the bank customers does not play
a significant role in the satisfaction level of users of E-Banking services.
H3: Occupation of the bank customers does
not play a significant role in the satisfaction level of users of E-Banking
services.
H4: Income of the bank customers does not
play a significant role in the satisfaction level of users of E-Banking
services.
Methodology:
The
researcher used the structured questionnaire to obtain the research data from
customers of various banks located in Coimbatore district. The convenience
sampling method was used to capture the relevant information from both the
users and non-users of Electronic Banking. A total of 300
questionnaires were randomly administered to customers and only 206
questionnaires turned to be valid data, which comprised of 165 users and 41
non-users of e-banking. These questionnaires were divided into
three sections: Section A contained questions on awareness and perceived usefulness of e-banking, while
section B dealt with the problems and reasons for not using e-banking and
section C dwells on demographic characteristics of respondents. Data
obtained from questionnaire were analyzed using simple percentage analysis and
Chi square test to test the hypotheses.
The Chi-Square test for independence, also
called Pearson's Chi-square test or the Chi-square test of association is used
to discover if there is a relationship between two categorical variables.
Formula used on these data is
X2 = (O - E)2
E
Where O is the Observed
Frequency in each category
E is
the Expected Frequency in the corresponding category
df is
the "degree of freedom" (n-1)
X2 is
Chi Square
SPSS
package was used for data compilation and analysis, while
descriptive statistics were computed and used in the interpretation of
findings.
RESULTS: DEMOGRAPHIC PROFILE OF THE RESPONDENTS
The
Table 1 represents the personal details of e-banking consumers. This
demographic study presents respondents gender, age, occupation, education,
monthly income and current residing areas. The sample size constituted of 206
e-banking service users and non-users of which 56.31% of the were males and
remaining 43.69% were females. 42.72% of the samples belonged to 21 to 30 years
age category, followed by 26.70% and 21.84% of the respondents fall in 31-40
years and below 21 years age respectively. 46.60% of the e-bankers were working
in private concerns. 55.83% were under graduates and 32.04% were post graduate
customers.
Table :1
Demographic profile of the respondents
|
|
Frequency |
Percentage |
|
|
Gender |
Male |
116.00 |
56.31 |
|
Female |
90.00 |
43.69 |
|
|
Total |
206 |
100 |
|
|
Age |
Below
21 years |
45.00 |
21.84 |
|
21
to 30 years |
88.00 |
42.72 |
|
|
31
to 40 years |
55.00 |
26.70 |
|
|
41
to 50 years |
15.00 |
7.28 |
|
|
Above
51 years |
3.00 |
1.46 |
|
|
Total |
206.00 |
100.00 |
|
|
Occupation |
Government
job |
16.00 |
7.77 |
|
Private
job |
96.00 |
46.60 |
|
|
Business
and professionals |
44.00 |
21.36 |
|
|
Agriculture |
4.00 |
1.94 |
|
|
Others |
46.00 |
22.33 |
|
|
Total |
206.00 |
100.00 |
|
|
Education |
High
school |
24.00 |
11.65 |
|
UG |
115.00 |
55.83 |
|
|
PG |
66.00 |
32.04 |
|
|
Illiterate |
1.00 |
0.49 |
|
|
Total |
206.00 |
100.00 |
|
|
Monthly
family Income |
Below
10000 |
58.00 |
28.16 |
|
10001
to 25000 |
80.00 |
38.83 |
|
|
25001
to 50000 |
60.00 |
29.13 |
|
|
More
than 50000 |
8.00 |
3.88 |
|
|
Total |
206.00 |
100.00 |
|
|
Area
of living |
Urban |
85.00 |
41.26 |
|
Semi
Urban |
33.00 |
16.02 |
|
|
Rural |
88.00 |
42.72 |
|
|
Total |
206.00 |
100.00 |
|
Nearly
38% of them had monthly income between Rs.10001 to Rs.50000 and 29.13% of the
customers were earning between Rs.25001 to Rs.50000. Almost 42.72% of the
respondents were currently residing in rural area, while 41.26% respondents had
from urban part of Coimbatore.
Hypothesis 1: There is no significant
relationship between education level and the satisfaction level of the users of
the e-banking services.
Table-2
Education wise, the satisfaction level of the respondents
|
Extent of satisfaction |
Educational qualification of the
respondents |
Total |
|||
|
High school |
UG |
PG |
Illiterate |
|
|
|
Highly satisfied |
2 |
36 |
20 |
0 |
58 |
|
Satisfied |
19 |
39 |
27 |
1 |
86 |
|
Neutral |
2 |
5 |
7 |
0 |
14 |
|
Dissatisfied |
0 |
1 |
4 |
0 |
5 |
|
Highly Dissatisfied |
0 |
2 |
0 |
0 |
2 |
|
Total |
23 |
83 |
58 |
1 |
165 |
The table-2
explains the education qualification and the level of satisfaction of the
respondents, which clearly states that majority of the under graduates i.e., 75
out of 83 respondents were either satisfied or highly satisfied with the
e-banking services offered by their banks.
It can be further inferred that out of 165 users of e-banking services,
86 users were satisfied irrespective of their educational qualification. Therefore, it is concluded that out of 165
respondents only 21 respondents were either neutral or dissatisfied with the
services offered by their banks.
Table-3 The Chi
Square Test- Result
|
|
Values |
Degrees of Freedom |
Asymp sig (2.-sided) |
|
Pearson Chi-Square |
19.874a |
12 |
0.069 |
|
Likelihood Ratio |
22.480 |
12 |
0.032 |
|
Linear-by-Linear Association |
0.033 |
1 |
0.855 |
|
N0 of Valid Cases |
165 |
|
|
a.
13 cells (65.0%) have expected count less than 5. The minimum expected count is 0.01.
The table-3 shows the results of chi-square
test calculated to find out whether there is significant relationship between education
level and satisfaction level of the respondents with regard to the e-banking
services. For the test to be significant at the 0.05 level, given 12 degrees of
freedom, the value for χ2 has to be at least 21.03. Therefore we cannot reject the null
hypothesis of no association between the two variables, namely education and
satisfaction level of the respondents.
Hypothesis 2:
There is no significant relationship between age and the satisfaction
level of the users of the e-banking services.
Table-4 Age wise satisfaction level of the
respondents
|
Extent of satisfaction |
Age of the respondents |
Total |
||||
|
Below 21 years |
21 to 30 years |
31 to 40 years |
41 to 50 years |
Above 51 years |
||
|
Highly satisfied |
6 |
30 |
18 |
3 |
1 |
58 |
|
Satisfied |
20 |
35 |
22 |
8 |
1 |
86 |
|
Neutral |
3 |
7 |
2 |
2 |
0 |
14 |
|
Dissatisfied |
0 |
3 |
2 |
0 |
0 |
5 |
|
Highly Dissatisfied |
0 |
0 |
2 |
0 |
0 |
2 |
|
Total |
29 |
75 |
46 |
13 |
2 |
165 |
The
above table-4 shows the age wise satisfaction level of the respondents, which
clearly indicates that majority of the respondents were falling below 40 years.
About 40 respondents falling under the age category of 31-40 years opined that
they were either satisfied or highly satisfied with the e-banking
services. About 65 respondents in the
age category of 21-30 years and 26 respondents in the age category of below 21
years were found to be satisfied or highly satisfied with the e-banking
services offered by their banks.
Table-5 The Chi Square
Test- Result
|
|
Values |
Degrees of Freedom |
Asymp sig (2.-sided) |
|
Pearson Chi-Square |
14.504a |
16 |
.561 |
|
Likelihood Ratio |
16.135 |
16 |
.444 |
|
Linear-by-Linear Association |
.001 |
1 |
.973 |
|
N of Valid Cases |
165 |
|
|
a. 17 cells (68.0%) have expected
count less than 5. The minimum expected count is 0.02.
The above
table-5 shows the results of chi-square test applied to find out whether there is
significant relationship between age and satisfaction level of the respondents
with regard to the e-banking services. For the test to be significant at the
0.05 level, given 16 degrees of freedom, the value for χ2 has
to be at least 26.30 (Chi square table value).
Since the calculated χ2 value is only 14.504, we accept
the null hypothesis and conclude that there is no significant relationship
between the age and the level of satisfaction of the respondents.
Hypothesis 3:
There is no significant relationship between occupation and the
satisfaction level of the users of the e-banking services.
Table-6 Occupation wise satisfaction level of
the respondents
|
Extent of satisfaction |
Occupation of the respondents |
Total |
||||
|
Government job |
Private job |
Business and professionals |
Agriculture |
Others specify |
||
|
Highly satisfied |
4 |
34 |
17 |
1 |
2 |
58 |
|
Satisfied |
7 |
38 |
16 |
2 |
23 |
86 |
|
Neutral |
0 |
7 |
3 |
0 |
4 |
14 |
|
Dissatisfied |
0 |
1 |
3 |
0 |
1 |
5 |
|
Highly Dissatisfied |
2 |
0 |
0 |
0 |
0 |
2 |
|
Total |
13 |
80 |
39 |
3 |
30 |
165 |
The table-6
demonstrates the occupation wise satisfaction level of the respondents, which
clearly indicates that majority of the respondents comprised of private
employees and professionals. Out of 80
private employees, 72 respondents were either highly satisfied or satisfied
with the e-banking services. In the
business and professional category, 36 out of 39 were either highly satisfied
or satisfied with the e-banking services offered by their banks. Only 7 respondents were found to be
dissatisfied or highly dissatisfied with the e-banking services.
Table-7 The Chi Square Test- Result
|
|
Values |
Degrees of Freedom |
Asymp sig (2.-sided) |
|
Pearson Chi-Square |
43.600a |
16 |
0.000 |
|
Likelihood Ratio |
34.509 |
16 |
0.005 |
|
Linear-by-Linear Association |
2.740 |
1 |
0.098 |
|
N of Valid Cases |
165 |
|
|
a.
17 cells (68.0%) have expected count less than 5. The minimum expected count is
0.04.
The above
table -7 shows the results of chi-square applied to find out whether is
significant relationship between occupation and satisfaction level of the
respondents with regard to the e-banking services. The calculated χ2 value
is found to be 43.60 which is greater than the table value. (χ2 table
value is at 16 degrees of freedom is 26.30). It is theoretically proved that if
the chi-square computed for the cross-tabulation is larger than the
value listed in the table, the relationship is "significant" at the
specified "level of significance." Hence we reject the null
hypothesis at the 0.05 level of significance, given 16 degrees of freedom and
conclude that there is significant relationship between the occupation and the
level of satisfaction of the respondents.
Hypothesis 4: There is no significant relationship
between monthly income and the satisfaction level of the users of the e-banking
services.
Table-8: Monthly income wise satisfaction
level of the respondents
|
Extent of satisfaction |
Monthly income of the
respondents |
Total |
|||
|
below 10000 per month |
10001 to 25000 per month |
25001 to 50000 per month |
Above 50000 |
||
|
Highly satisfied |
6 |
22 |
22 |
8 |
58 |
|
Satisfied |
29 |
32 |
18 |
7 |
86 |
|
Neutral |
4 |
8 |
1 |
1 |
14 |
|
Dissatisfied |
0 |
1 |
4 |
0 |
5 |
|
Highly Dissatisfied |
0 |
2 |
0 |
0 |
2 |
|
Total |
39 |
65 |
45 |
16 |
165 |
The table-8
shows the monthly income wise satisfaction level of the respondents. It was
inferred from the above table that 86 out of 165 respondents were satisfied
with the e-banking services irrespective of their income level. And 58 respondents, which comprises of 22
from the monthly income category of Rs 10,001-25,000 and 22 from Rs.
25001-50,000, 8 respondents from above Rs.50,000 and 6 respondents from below
Rs.10,000 monthly income category opined that they were highly satisfied with
the e-banking services offered to them.
Table-9 The Chi Square Test- Result
|
|
Value |
Degrees of Freedom |
Asymp.
Sig. (2-sided) |
|
Pearson
Chi-Square |
26.830a |
12 |
0.008 |
|
Likelihood
Ratio |
28.706 |
12 |
0.004 |
|
Linear-by-Linear
Association |
3.864 |
1 |
0.049 |
|
N
of Valid Cases |
165 |
|
|
a.
11 cells (55.0%) have expected count less than 5. The minimum expected count is
0.19.
The above table -9 illustrates the results of
chi-square test applied to find out whether there is a significant relationship
between monthly income and satisfaction level of the respondents with regard to
the e-banking services. It can be inferred from the above table that the
calculated χ2 value is 26.830 which is greater than the χ2
table value is at 12 degrees of freedom. ( table value is 21.03). Hence
we reject the null hypothesis at the 0.05 level of significance, given 12 d.f and conclude that there is significant relationship
between the monthly income and the level of satisfaction of the respondents.
Summary of the Hypothesis Testing
|
Hypothesis |
Result |
|
Education level of the bank customer plays a significant role
in the satisfaction level of users of E-Banking services. |
No significant relationship |
|
Age of the bank customers plays a significant role in the
satisfaction level of users of E-Banking services |
No significant relationship |
|
Occupation of the bank customers plays a significant role in
the satisfaction level of users of E-Banking services |
Significant relationship exists |
|
Income of the bank customers plays a significant role in the
satisfaction level of users of E-Banking services. |
Significant relationship exists |
The above
results of the stated research questions lead to conclusions and managerial
implications and decisions.
1) Education
and Age of the customer does not play significant role in the customer
satisfaction of the E-Banking Services. The technology adopted by banks is user
friendly and hence customers are at ease in conducting their banking
transactions.
2) Occupation
and Income of the customers play a significant role in the satisfaction of the
e-Banking services.
CONCLUSION:
The banking
industry has adopted technology with more zeal and passion and has transformed
the mode and style of banking service delivery. While some banks took
leadership roles and initiated introduction of technology in the banking
industry, most banks followed suit either due to cost reduction or due to
competition. On the other hand, customer perception and attitude towards
E-banking has varied response. The researcher in the present study analysed one of the factors that could influence the
perception and attitude of customers towards E-Banking services i.e.
Demographic Factors. It is observed in the research, that education and age of
the banking customers does not play significant role in perception formation
and attitude influence towards E-Banking Services, while Occupation and Income
of the customer play a dominant role in the minds of the customer towards
satisfaction level of E-Banking services.
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Received on 12.06.2011 Accepted on 01.08.2011
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