usefulness and benefits of e-banking / internet banking...

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CHAPTER 6

USEFULNESS AND BENEFITS OF E-BANKING / INTERNET BANKING SERVICES 6.1 Introduction

In the previous two chapters, bank customers’ adoption of e-banking /

internet banking services and functional / psychological aspects of barriers /

benefits in adoption of e-banking are evaluated. In this chapter an attempt is

made to evaluate the usefulness and benefits of e-banking services as well as

intention to use e-banking / internet banking services in the future.

In the questionnaire, to find out the benefits of e-banking / internet

banking, 14 statements pertaining to different characteristics of e-banking have

been included with 7 point scale from “Very Strongly Disagree (VSD)”,

“Strongly Disagree (SD)”, “Disagree (D)”, “Normal (N)”, “Agree (A)”,

“Strongly Agree (SA)” and “Very Strongly Agree (VSA)”. The collected data

were first subjected to reliability analysis to ascertain internal consistency of the

items in the scale. After ascertaining that the items in the scale were consistent,

the data were subjected to “Principal component method of Factor analysis with

varimax rotation” to find out primary benefits (major dimensions) of e-banking.

After identifying the primary benefits, the average scores for each primary

benefit and then compared across respondent groups based on type of bank

sector, availing e-banking services, location, gender, age, education, occupation

and family income to evaluate whether the opinion regarding benefits of

e-banking is independent of the socio-economic and banking characteristics or

not.

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Similarly, seven different services through e-banking / internet banking

included with 7-point scale ranging from “Not at all useful”, “Little useful”,

“Somewhat useful”, “Moderately useful”, “Useful”, “Very useful” and “Very

highly useful” to measure the usefulness of e-banking. The most useful services

are identified by ordering the seven different services based on mean perception

scores of the entire sample. Then the perception of the respondents across

categories by type of bank sector, availing e-banking services, location, gender,

age, education, occupation and family income is compared to identify whether

there is any association between socio-economic / banking characteristics and

perceived usefulness of e-banking services.

Further, information regarding intention to use e-banking / internet

banking in the future gathered from respondents were also analysed in this

chapter. Finally, the relationship of benefits as well as usefulness of e-banking

with intention to use e-banking / internet banking were analyzed using Canonical

correlation analysis. The results of the analysis are presented and discussed

hereunder.

The results of the reliability / item analysis for scale items measuring

benefits of e-banking / internet banking are reported in Table 6.1.

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Table 6.1

Reliability / Item Analysis Results for Scale Items Measuring Benefits of e-Banking / Internet Banking [IB]

Item

No

Description of Scale Items Item to

Total Correlation

Alpha if Deleted

1 IB transactions save more time 0.4109 0.8921

2 IB provides more responsive service 0.6780 0.8797

3 IB transactions have lower cost 0.6066 0.8826

4 IB can make me feel enjoyable that I can control processes of financial transactions on my own via the Internet

0.7221 0.8777

5 IB provides customized services according to my needs and wants

0.5152 0.8873

6 IB provides systems to assist me to share my experiences with other customers of my bank more efficiently

0.5447 0.8855

7 IB provides systems to assist me to share my experiences with my bank more efficiently

0.4984 0.8876

8 IB provides link to other websites 0.5998 0.8832

9 IB provides accurate information 0.4770 0.8880

10 IB provides relevant information 0.6222 0.8827

11 IB provides up-to-date information 0.6129 0.8826

12 IB is easy to access with my Convenience 0.6339 0.8816

13 IB has more flexible ways to search for information 0.6269 0.8824

14 IB transactions save more time 0.5622 0.8846

Cronbach’s Alpha Reliability Coefficient 0.8915

Source: Primary Data

From the table, it can be seen that the correlation of all 14 items with their

total sum score (Item to total correlation) ranged between 0.4109 (Item 1) and

0.7221 (Item 4). It reveals the sufficient positive correlation values of at least

0.30 for all items in the scale. As there is sufficient correlation between each

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item and total sum score, all 14 items in the scale for measuring benefits of e-

banking / internet banking are considered to be internally consistent with each

other.

It is further apparent from the table that the Cronbach’s alpha reliability

coefficient is 0.8915, indicating that the degree of internal consistency among 14

items in the scale has been excellent. It further reveals that information against

18 items collected from respondents are consistent, reliable and valid. As the

scale items measuring benefits of e-banking / internet banking are highly reliable

and internally consistent, further analysis have been carried with collected data.

As the scale items measuring benefits of e-banking and internet banking

is reliable, the opinion data against these items were subjected to factor analysis.

The results of factor analysis, such as eigen value and explained variance of each

factor are reported in Table 6.2 and factor loadings of each item with valid

factors are depicted in Table 6.3.

According to the table 6.2, the initial eigen values before Varimax

rotation is above one (the required nor for valid factors as per Kaiser Criterion)

for first four factors. This envisages that there are four major benefits from

adoption of e-banking / internet banking.

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Table 6.2

Eigen values of Factors Underlying Benefits of e-Banking / Internet Banking

Factors Eigen value % of Total Variance

Cumulative % ofTotal Variance

1 6.00 42.85 42.85

2 1.57 11.19 54.04

3 1.32 9.44 63.48

4 1.10 7.85 71.33

5 0.71 5.05 76.39

6 0.61 4.39 80.77

7 0.48 3.43 84.20

8 0.44 3.15 87.35

9 0.40 2.86 90.21

10 0.34 2.46 92.67

11 0.32 2.28 94.95

12 0.26 1.89 96.83

13 0.25 1.79 98.63

14 0.19 1.37 100.00


Further, from eigen value of 6.00 for the first, 1.57 for the second, 1.32

for the third and 1.10 for the fourth factor, it is understood that the first, second,

third and fourth factors posses 42.85 per cent, 11.19 per cent, 9.44 per cent and

7.85 per cent of the essence of original data before Varimax rotation

respectively. The total variance explained together by all these four valid factors

is 71.33 per cent in the actual data regarding benefits of e-banking / internet

banking. The extractable factors are shown diagrammatically using Scree plot

chart in 6.1.

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Chart 6.1

Eigen values of Factors Underlying Benefits of e-Banking / Internet Banking

In the above Scree plot, it is apparent that the mountain point (steep slope

from top) ends at eigenvalue ‘1’. This strongly provides evidence that there are

four benefits of e-banking / internet banking according to bank customers in the

sample.

Table 6.3 reports the factor loadings of each item with four valid factors

(correlation between each item and each factor) benefits of e-banking / internet

banking after varimax rotation. After varimax rotation, the eigen values

(variance in the data) of valid factors have become 2.47 (17.65 per cent), 2.48

(17.73 per cent), 2.97 (21.18 per cent), 2.07 (14.77 per cent) and at the same

time leaving the total explained variance in the actual data as the same as before

rotation (71.33 per cent).

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Table 6.3

Factor Loadings of Items with Extracted Factors (After Varimax Rotation)

Factor

Item

N

o Description of Scale Items 1 2 3 4

1 IB transactions save more time 0.87 0.10 0.12 -0.10

2 IB provides more responsive service 0.84 0.17 0.25 0.22

3 IB transactions have lower cost 0.74 0.19 0.22 0.24

9 IB provides accurate information 0.14 0.84 0.05 0.09

10 IB provides relevant information 0.16 0.76 0.19 0.28

11 IB provides up-to-date information 0.21 0.70 0.32 0.11

8 IB provides link to other websites 0.10 0.63 0.31 0.31

12 IB is easy to access with my Convenience 0.21 0.13 0.85 0.11

13 IB has more flexible ways to search for information

0.17 0.21 0.81 0.11

14 Using IB fits well with the way I like to manage my finances

0.09 0.12 0.80 0.17

4 IB can make me feel enjoyable that I can control processes of financial transactions on my own via the Internet

0.37 0.19 0.68 0.27

6 IB provides systems to assist me to share my experiences with other customers of my bank more efficiently

0.06 0.25 0.20 0.81

7 IB provides systems to assist me to share my experiences with my bank more efficiently

0.08 0.22 0.14 0.79

5 IB provides customized services according to my needs and wants

0.36 0.03 0.22 0.60

Explained Variance 2.47 2.48 2.97 2.07

% of Total Variance 17.65 17.73 21.18 14.77

Cumulative % of Total Variance 17.65 35.38 56.57 71.33

Factor Label

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From the observation of the factor loadings, it is understood that the

loadings of items 1 (0.87), 2 (0.84) and 3 (0.74) with the first factor, items 9

(0.84), 10 (0.76), 11 (0.70) and 8 (0.63) with the second factor, items 12 (0.85),

13 (0.81), 14 (0.80) and 4 (0.68) with the third factor, and items 6 (0.81), 7

(0.79) and 5 (0.60) with the fourth factor are higher than that of those with other

remaining factors. The above picture implies that most of the characteristics of

items 1 and 2, item 9, items from 12 to 14 and items 6 and 7 are possessed by the

first, second, third and fourth factors respectively.

Therefore, from highest loading of item(s) with each factor, the first

factor is identified as “Save time & Cost less”, the second factor as “Provide

accurate, relevant and up-to date information”, the third factor as “Flexible and

easily accessible with convenience” and the fourth factor is identified with label

as “Assists to share the experience with bank and other customers more

efficiently

The scores for each valid factor are calculated by averaging the scores of

items highly loaded in that factor. The scores thus obtained are used in the

subsequent analysis. As the opinion from each respondent against each items in

the scale is measured using 7 point Likert type scale ranging from ‘1’ for “Very

Strongly Disagree” to ‘7’ for “Very Strongly Agree”, the opinion of a

respondent group is considered to be as “Very Strongly Disagree”, “Strongly

Disagree”, “Disagree”, “Neutral”, “Agree”, “Strongly Agree”, “Very Strongly

Agree” for mean score of “< 1.50”, “>= 1.50 and < 2.50”, “>= 2.50 and

< 3.50”, “>=3.50 and < 4.50”, “>= 4.50 and < 5.50”, “>= 5.50 and < 6.50” and

“>= 6.50” respectively.

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6.2 Benefits of e-Banking / Internet Banking Vs Socio-Economic /

Banking Characteristics

First, the level of opinion of the entire sample about major benefits is

evaluated by averaging the opinion scores against each dimension. The mean

and standard deviation of the score are reported in Table 6.4.

Table 6.4

Major Benefits of e-Banking as per Entire Sample

Benefits Mean Standard Deviation

Save time & Cost Less 5.00 1.20

Provide accurate, relevant and up-to date information

5.10 1.04

Flexible and easily accessible with convenience

5.12 1.08

Assists to share the experience with bank and other customers more efficiently

4.79 1.17


As shown in the table, the mean perception scores of all sample are in the

agree range (>= 4.50 and < 5.50) for all four benefit dimension. However, the

score is as high as 5.12 for “Flexible and easily accessible with convenience”

followed by 5.10 for “Provide accurate, relevant and up-to date information”,

5.00 for “Save time & Cost Less” and 4.79 for “Assists to share the experience

with bank and other customers more efficiently”. This envisages that “flexibility

and easy accessibility with convenience” is the top most benefit followed by

“Providing accurate, relevant and up-to date information” and “Saving time &

Cost Less”.

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The major benefits of e-banking / internet banking adoption as perceived

by the respondent are compared between public and private sector banks and the

results of the test are reported in Table 6.5.

Table 6.5

Benefits of e-Banking - Comparison of Perception between Public and Private Sector Bank Customers

Banking Sector

Public Private Q. No

Major Benefits

(n=247) (n=113)

t value

4.89 5.26 2.72*** 1 Save time & Cost Less

(1.26) (1.02)

5.00 5.31 2.61*** 2

Provide accurate, relevant and up-to date information (1.05) (0.99)

4.97 5.43 3.81*** 3

Flexible and easily accessible with convenience (1.14) (0.86)

4.73 4.92 1.38 4 Assists to share the experience with bank and other customers more efficiently

(1.19) (1.12)

Source: Primary Data. Figures in brackets are standard deviation. ***Significant at 1% level.

It can be seen from the table, the bank customers of both public and

private sector banks have agreed that e-banking / internet banking save time &

cost less (Mean = 4.89 for public & 5.26 for private sector), provide accurate,

relevant and up to date information (Mean = 5.00 for public & 5.31 for private

sector), flexible and easily accessible with convenience (Mean = 4.97 for public

& 5.43 for private sector) and it assists to share the experience with bank and

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other customers more efficiently (Mean = 4.73 for public & 4.92 for private

sector). However, from F value, which is significant at 1 per cent level for all

benefits except “assists to share the experience with bank and other customers

more efficiently”, it is apparent that the level of agreement among private bank

customers is significantly higher than that of public sector bank customers. This

shows that adoption of e-banking / internet banking provided by the private

sector banks is more beneficial in terms of “time and cost”, “providing accurate,

relevant and up-to date information” and “accessibility with convenience”

compared to public sector banks.

The opinion about benefits of e-banking / internet banking is compared

between non-users and users of e-banking groups and Table 6.6 presents the

results.

Table 6.6

Benefits of e-Banking - Comparison of Perception between Users and Non-Users of e-Banking / Internet Banking [IB]

e-Banking / IB

User Non-User Q. No

Major Benefits

(n=229) (n=131)

t value

5.10 4.84 1.96** 1 Save time & Cost Less

(1.17) (1.24)

5.27 4.80 4.29*** 2


5.34 4.73 5.27*** 3


4.90 4.60 2.42** 4


(1.07) (1.31)

Source: Primary Data. Figures in brackets are standard deviation. **Significant at 5% level; ***Significant at 1% level

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From the perusal of the table, it is evident that the users and non-users of

e-banking / IB among bank customer groups have agreed with all four primary

benefits of e-banking / IB. But the level of agreement is significantly less

among non-user group than that of user group with regard to all benefit

dimensions. Hence, it is concluded that perceived benefits of e-banking /

internet banking is significantly influenced by availing of e-banking / IB

services among bank customers.

From the opinion of respondent groups from rural, semi-urban and urban

areas four major benefits of e-banking / IB is compared using F-test and results

of the analysis are reported in Table 6.7.

Table 6.7

Benefits of e-Banking - Comparison of Perception by Respondents’ Location

Location

Rural Semi-urban

Urban Q. No

Major Benefits

(n=161) (n=80) (n=119)

F value

4.82 5.21 5.11 3.53*** 1 Save time & Cost Less

(1.05) (1.26) (1.32)

4.82 5.52 5.20 13.82*** 2

Provide accurate, relevant and up-to date information (1.14) (0.67) (1.00)

4.82 5.44 5.30 12.36*** 3

Flexible and easily accessible with convenience (1.20) (0.74) (1.01)

4.45 5.16 5.00 13.67***

4


(1.32) (0.85) (1.01)

Source: Primary Data. Figures in brackets are standard deviation. ***Significant at 1% level.

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According to the table 6.7, the urban customers have agreed with all

benefits, while semi-urban customers have strongly agreed with “Assists to share

the experience with bank and other customers more efficiently” (Mean = 5.52,

in the strongly agree range) and agree with the other three benefits (Mean scores

are in agree range). The rural groups, on the other hand, have neither disagreed

nor agreed with “Assists to share the experience with bank and other customers

more efficiently” (Mean = 4.45, in “neutral” range) while agreeing with other

benefits. The F value, 3.53, 13.82, 12.36 and 13.67 for the first, second, third

and fourth benefits are significant at one per cent level. This has led to the

finding that the perceived level of benefits from e-banking / IB adoption differ

significantly by location of the bank customers.

Table 6.8 exhibits the results of comparison of opinion about e-banking /

IB benefits across respondent groups by Gender. It can be observed from the

table that the mean perception scores for both male and female groups are in the

‘agree’ range in respect of all the four major benefits of e-banking / IB. At the

same time, the number of female customers with ‘agree’ opinion about the

second and third benefits is less compared to those in the male groups as the

mean perception score for female group is less than that of the male group.

However, from the F values, which are insignificant for all, it is apparent that the

difference in opinion between the two gender groups is due to chance and not

significant at required hypothetical level.

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Table 6.8

Benefits of e-Banking - Comparison of Respondents’ Perception by Gender

Gender

Male Female Q. No

Major Benefits

(n=286) (n=74)

t value

5.00 5.01 0.04 1 Save time & Cost Less

(1.19) (1.27)

5.13 4.98 1.08 2


5.16 4.94 1.55 3


4.84 4.62 1.44

4


(1.06) (1.52)

Source: Primary Data. Figures in brackets are standard deviation.

So, it is concluded from the results of comparative analysis for customer

groups by gender that the perceived level of benefits of e-banking / IB is

independent of gender of the bank customers.

Table 6.9 reports the results of one way ANOVA (F test) comparing the

mean perception scores by Age groups with regard to benefits of e-banking / IB.

From the examination of the table, it is clear that the mean scores for all age

groups against all benefit dimensions are in between 4.50 and 5.50, the range for

“agree” opinion. Regarding all benefits except “Assists to share the experience

with bank and other customers more efficiently”, all age groups have expressed

similar level of agreement (F values are insignificant).

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Table 6.9

Benefits of e-Banking - Comparison of Respondents’ Perception by Age

Age (in Years)

Up to 25 26 - 40 Above 40 Q. No

Major Benefits

(n=87) (n=216) (n=57)

F value

4.94 5.06 4.90 0.55 1 Save time & Cost Less

(1.03) (1.28) (1.15) 5.06 5.11 5.11 0.08

2 Provide accurate, relevant and up-to date information (1.02) (0.99) (1.23)

5.05 5.17 5.03 0.60 3


4.58 4.90 4.71 2.44*

4


(1.25) (1.11) (1.22)

Source: Primary Data. Figures in brackets are standard deviation. *Significant at 10% level.

But there seems to be marginal difference in the level of agreement

among age groups regarding the fourth benefit as mean scores of respondents

with age up to 25 years is 4.58 and F value is 2.44, which is significant at 10 per

cent level. As the difference in the opinion among age groups about the fourth

benefit is marginal, and the level of agreement among all groups about the

remaining three benefits is at similar extent, it is deduced that the perceived

benefits of e-banking / IB is independent of the age of the bank customers.

The difference in opinion about benefits of e-banking / internet banking

among respondent groups by education is tested with F-test and the results of the

test are depicted in Table 6.10.

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Table 6.10

Benefits of e-Banking - Comparison of Respondents’ Perception by Education

Education

Secondary Degree Above Degree

Q. No

Major Benefits

(n=42) (n=145) (n=173)

F value


(0.95) (1.10) (1.31)

5.46 4.82 5.24 9.70*** 2


5.24 4.89 5.27 5.38*** 3


5.09 4.44 5.01 11.41***

4


(1.00) (1.14) (1.16)

Source: Primary Data. Figures in brackets are standard deviation. ***Significant at 1% level

An examination of the table indicates that the mean perception scores for

all educated groups against all benefit dimensions except for graduates in respect

of “Assists to share the experience with bank and other customers more

efficiently” (Mean = 4.44) are in the “agree” range. The level of agreement is

significantly higher for post-graduates (above degree holders) (Mean = 5.19)

with “Save time & Cost Less” (F = 4.36, p < 0.01) whereas it is significantly

lesser among graduates regarding “Provide accurate, relevant and up-to date

information” (Mean = 4.82) (F = 9.70, p < 0.01), “Flexible and easily accessible

with convenience” (Mean = 4.89) (F = 5.38, p < 0.01) and “Assists to share the

experience with bank and other customers more efficiently” (F = 11.41,

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p < 0.01). To sum up, it is found that the perceived level of benefits from

adoption of e-banking / internet banking is related to educational status of the

bank customers.

Table 6.11 provides the results of F test comparing respondents’ opinion

about benefits from e-banking / IB among groups by occupational status.

Table 6.11

Benefits of e-Banking - Comparison of Respondents’ Perception by Occupation

Occupation

Stu

den

t

Hou

sew

ife

Gov

t.

Em

plo

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Pri

vate

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mp

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Bu

sin

ess

/

Sel

f

Em

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Q. No

Major Benefits

(n=55) (n=18) (n=136) (n=120) (n=31)

F value

4.89 5.11 4.92 5.13 5.01 0.65 1 Save time & Cost Less

(0.97) (0.94) (1.34) (1.13) (1.35)

5.25 5.61 5.09 4.94 5.18 2.16* 2


(0.85) (0.61) (1.08) (1.13) (0.85)

5.15 5.15 5.06 5.15 5.12 0.14 3

Flexible and easily accessible with convenience

(1.14) (1.27) (1.20) (0.91) (0.96)

4.65 4.24 4.74 4.86 5.30 2.91**

4


(1.27) (1.73) (1.19) (1.03) (0.80)

Source: Primary Data. Figures in brackets are standard deviation. *Significant at 10% level; **Significant at 5% level

According to the table, bank customers belonging to student, housewife,

government employee, private employee and business / self-employed groups

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have all agreed with all benefits except housewives in respect of “Assists to

share the experience with bank and other customers more efficiently” and

“Provide accurate, relevant and up-to date information”. The housewife group,

while expressing “strong agreement” with “Provide accurate, relevant and up-to

date information” (Mean = 5.61), have expressed neither disagreement nor

agreement with “Assists to share the experience with bank and other customers

more efficiently” (Mean = 4.24). From F value, it is evident that the level of

agreement is similar among all occupational groups with regard to “Save time &

Cost Less” and “Flexible and easily accessible with convenience”, whereas the

level of agreement among housewives is marginally higher in respect of

“Provide accurate, relevant and up-to date information” (F value = 2.16,

p < 0.10) and significantly less regarding “Assists to share the experience with

bank and other customers more efficiently” (F value = 2.91, p < 0.05) compared

to that of those in other occupational groups.

So, it is concluded that perceived benefits from e-banking / IB such as

“save time & cost less” as well as “Flexible and easily accessible with

convenience” is independent of the occupational status whereas the perception

regarding the other two benefits is affected by the occupational status of the

bank customers.

Table 6.12 presents the results of the analysis comparing the respondents’

perception about the four major benefits of e-banking / IB adoption by monthly

income of the family.

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Table 6.12

Benefits of e-Banking - Comparison of Respondents’ Perception by Income

Income

Up to Rs.10000

Rs.10001 - 25000

> Rs.25000

Q. No

Major Benefits

(n=119) (n=154) (n=87)

F value


(1.23) (1.14) (1.18)

4.84 5.17 5.32 6.11*** 2


5.04 5.19 5.10 0.65 3


4.63 4.60 5.34 13.72***

4


(1.18) (1.21) (0.89)

Source: Primary Data. Figures in brackets are standard deviation. ***Significant at 1% level

As shown in the table, the level of opinion about all four benefits of

e-banking / IB among respondents groups with all levels of family income (per

month) is in between 4.50 and 5.50, the range for “agree”. But the mean

perception, 5.43, 5.32 and 5.34 of respondent group with family income above

Rs.25000 are significantly higher than the mean perception of those in the group

with family income up to Rs.10000 and between Rs.10000 and 25000 in respect

of “Save time & Cost Less” (F value = 7.48, p < 0.01), “Provide accurate,

relevant and up-to date information” (F value = 6.11, p < 0.01) and “Assists to

share the experience with bank and other customers more efficiently” (F value =

13.72, p < 0.01) respectively. Regarding “Flexible and easily accessible with

convenience”, the level of agreement is the same among all income groups

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(F value is insignificant). From the inferences of the results, it is found that the

perceived benefits of e-banking / IB is related to the status of family income of

bank customers.

6.3 Usefulness of e-Banking / Internet Banking

The usefulness of e-banking / Internet banking as perceived by the

respondents are evaluated here. Table 6.13 presents the opinion of all

respondents in the sample. The opinion is obtained in the 7 point scale, the mean

score “< 1.50”, “>= 1.50 and <2.50”, “>= 2.50 and 3.50”, “>= 3.50 and 4.50”,

“>= 4.50 and 5.50”, “>= 5.50 and < 6.50” and “>= 6.50” refers to “Not at all

useful”, “Little useful”, “Somewhat useful”, “Moderately useful”, “Useful”,

“Very useful” and “Very highly useful” respectively.

Table 6.13

Usefulness of e-Banking / IB – All Sample

e-Banking Services Mean Standard Deviation

Account details and balance statements 5.11 1.56

Funds transfer 5.19 1.40

Loan transaction 4.69 1.83

Pay bills using available cash in the accounts 5.18 1.34

Order to buy and sell shares 5.16 1.46

Open new accounts 4.66 1.82

Generate the latest reports of banking transactions 5.36 1.46

Source: Primary Data.

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As per the table, the mean perception of the total sample, which ranges

between 4.66 and 5.36, is in the “useful” opinion range (>= 4.50 and < 5.50), in

turn indicating that majority of the respondents in the sample have perceived all

facilities of e-banking / IB as useful. Further from the ordering of mean scores

from high to low, it is clear that “Generating the latest reports of banking

transactions” (Mean = 5.36) is major usefulness followed by “Funds transfer”

(Mean = 5.19), “Pay bills using available cash in the accounts” (Mean = 5.18)

and “Order to buy and sell shares” (Mean = 5.16) whereas e-banking / IB is not

very much useful for “opening new accounts” and “loan transactions”.

To check whether the usefulness of e-banking / Internet banking differ by

type of banking sector, the mean perception between public and private sector

bank customers is compared with t-test and the results of the test are given in

Table 6.14.

From the table, it can be seen that the public sector group have seen all

but “open new accounts” as usefulness of e-banking / internet banking as the

mean scores are in the “useful” range (>= 4.50 and 5.50). Regarding “open new

accounts” (Mean = 4.48), public sector customer group have perceived as

“moderately useful” (>= 3.50 and 4.50). On the other hand, private sector bank

customers have found “Account details and balance statements” (Mean = 5.33),

“Loan transaction” (Mean = 4.86), “Pay bills using available cash in the

accounts” (Mean = 5.21) and “Open new accounts” (Mean = 5.04) as useful

whereas they found “Funds transfer” (Mean = 5.67), “Order to buy and sell

shares” (Mean = 5.59) and “Generate the latest reports of banking transactions”

(Mean = 6.02) as very useful (Mean scores are >= 5.50 and < 6.50, the range for

“very useful”).

161

Table 6.14

Usefulness of e-Banking / IB - Comparison of Perception between Public and Private Sector Bank Customers

Banking Sector

Public Private Q. No

e-Banking Services

(n=247) (n=113)

t value

5.02 5.33 1.77* 1

Account details and balance statements (1.64) (1.35)

4.97 5.67 4.54*** 2 Funds transfer

(1.56) (0.76)

4.61 4.86 1.21 3 Loan transaction

(1.95) (1.55)

5.17 5.21 0.28 4

Pay bills using available cash in the accounts (1.43) (1.11)

4.97 5.59 3.85*** 5 Order to buy and sell shares

(1.56) (1.07)

4.48 5.04 2.75*** 6 Open new accounts

(1.93) (1.50)

5.06 6.02 6.07*** 7

Generate the latest reports of banking transactions (1.57) (0.90)

Source: Primary Data. Figures in brackets are standard deviation. *Significant at 10% level; ***Significant at 1% level

The level of opinion among private sector bank customers is significantly

higher than that of public sector bank customers in respect of “Funds transfer”

(t-value = 4.54, p < 0.01), “Order to buy and sell shares” (t-value = 3.85,

p < 0.01), “Open new accounts” (t-value = 2.75, p < 0.01) and “Generate the

latest reports of banking transactions” (t-value = 6.07, p < 0.01). This in turn

reveals that these services through e-banking / internet banking are much better

in private sector banks compared to their public sector counterparts. In short, it

is found that all services of e-banking / IB is useful according to both public and

162

private sector bank customers, but usefulness of services like “Funds transfer”,

“Order to buy and sell shares”, “Open new accounts” and “Generate the latest

reports of banking transactions” in private sector banks are significantly better

compared to these services in public sector banks through e-banking / internet

banking.

The level of usefulness of e-banking and internet banking for users and

non-users of these services is analyzed by comparing the mean perception

between two groups. Table 6.15 reports the results of the analysis.

As reported in the table, the users of e-banking services have perceived all

the services except “Generate the latest reports of banking transactions” as

“useful” as the mean perception score these services, which ranges between 4.83

(Open new accounts) and 5.40 (Funds transfer). In respect of “Generate the

latest reports of banking transactions”, the mean perception score is 5.66

(>= 5.50 and < 6.50, the range for “very useful”), indicating that the e-banking /

internet banking is very useful for generating the latest reports of banking

transactions for user group. The perceived status of usefulness is slightly

different among non-users of e-banking services.

163

Table 6.15

Usefulness of e-Banking / IB - Comparison of Perception between Users and Non-Users of e-Banking / IB

e-Banking / IB

User Non-User Q. No

e-Banking Services

(n=229) (n=131)

t value

5.32 4.75 3.42*** 1


5.40 4.82 3.85*** 2 Funds transfer

(1.22) (1.60)

4.92 4.27 3.27*** 3 Loan transaction

(1.67) (2.03)

5.34 4.92 2.89*** 4


5.34 4.85 3.16*** 5 Order to buy and sell shares

(1.40) (1.51)

4.83 4.35 2.44** 6 Open new accounts

(1.70) (1.98)

5.66 4.84 5.28*** 7



Though non-user group have perceived all services except “loan

transaction” and “open new accounts” through e-banking as useful (Mean scores

are >= 4.50 and < 5.50), the level of their opinion about all services is

significantly less than that of those in the user group. Regarding “loan

transaction” and “open new accounts”, the perception of the non-user group is in

the “moderately useful” level. To sum up, it is understood that almost all the

services are perceived to be useful by both user and non-user of e-banking

services, but the level of perception about usefulness of e-banking/IB among

non-user group is significantly less than that of user group.

164

The perception of the respondents about usefulness of e-banking / IB is

compared across categories of respondents based on their socio-economic and

banking characteristics to ascertain whether the opinion is independent of these

characteristics or not. First in this line, Table 6.15 present the results of the

analysis comparing the opinion among respondent groups belonging to rural,

semi-urban and urban areas.

Table 6.16

Usefulness of e-Banking / IB - Comparison of Perception by Respondents’ Location

Location

Rural Semi-urban

Urban Q. No

e-Banking Services

(n=161) (n=80) (n=119)

F value

4.64 5.39 5.57 14.91*** 1

Account details and balance statements (1.61) (1.69) (1.17)

4.88 5.39 5.48 7.53*** 2 Funds transfer

(1.55) (1.44) (1.02)

4.18 5.43 4.87 14.27*** 3 Loan transaction

(1.96) (1.28) (1.77)

4.80 5.39 5.57 13.58*** 4

Pay bills using available cash in the accounts (1.45) (1.26) (1.08)

4.81 5.58 5.37 9.64*** 5 Order to buy and sell shares

(1.50) (1.12) (1.49)

4.52 5.29 4.43 6.41*** 6 Open new accounts

(1.96) (1.31) (1.84)

5.22 5.70 5.31 2.97** 7

Generate the latest reports of banking transactions (1.70) (1.15) (1.27)

Source: Primary Data. Figures in brackets are standard deviation. **Significant at 5% level; ***Significant at 1% level.

165

From the perusal of the table, it is apparent that the bank customers

belonging to rural areas have seen all e-banking services except “loan

transaction” as useful (Mean scores ranging between 4.18 and 5.22 are >= 4.50

and < 5.50, in the “useful” range). The “loan transaction” through e-banking is

moderately useful according to rural customers (Mean = 4.18). On the other

hand, semi-urban group have perceived the “Order to buy and sell shares” (Mean

= 5.58) and “Generate the latest reports of banking transactions” (Mean = 5.70)

through e-banking as “very useful” (“>= 5.50 and < 6.50”, very useful) while

considering other remaining services as “useful” (Mean scores are in between

4.50 and 5.50). The urban bank customers have considered the “Account details

and balance statements” (Mean = 5.57) and “Pay bills using available cash in the

accounts” (Mean = 5.57) as “very useful” and other services as “useful” (>= 4.50

and 5.50).

The F values obtained for the difference in group mean values are

significant in respect of all e-banking services. This has led to the conclusion

that the level of usefulness of e-banking services is significantly less for rural

bank customers compared to their semi-urban and urban counterparts.

Table 6.17 shows mean perception score and t-values for the difference in

mean perception between male and female respondents regarding usefulness of

e-banking.

166

Table 6.17

Usefulness of e-Banking / IB - Comparison of Respondents’ Perception by Gender

Gender

Male Female Q. No

e-Banking Services

(n=286) (n=74)

t value

5.10 5.16 0.30 1


5.23 5.03 1.14 2 Funds transfer

(1.36) (1.53)

4.62 4.95 1.37 3 Loan transaction

(1.85) (1.76)

5.27 4.84 2.51** 4


5.13 5.28 0.79 5 Order to buy and sell shares

(1.48) (1.35)

4.60 4.86 1.10 6 Open new accounts

(1.79) (1.92)

5.42 5.14 1.48 7


Source: Primary Data. Figures in brackets are standard deviation. **Significant at 5% level

It can be seen from the table that the male respondents have considered all

the e-banking services as useful because the mean perception scores, ranging

between 4.60 and 5.42, are in “useful” range (>= 4.50 and 5.50). The perceived

status of e-banking /IB services has also been in the useful range for female

respondent groups. Both male and female bank customers do not differ in their

level of opinion about usefulness of all e-banking services except “Pay bills

using available cash in the accounts”. For male customers, usefulness of

e-banking service for paying bills using available cash in the accounts is

significantly higher than that of female customers (F value = 2.51, p < 0.05).

167

Overall, it is found that there is no difference in the perceived status of

usefulness of e-banking services between male and female customers.

The usefulness of e-banking / internet banking services is compared by

age of the respondents and the results of the comparative analysis are reported in

Table 6.18.

Table 6.18

Usefulness of e-Banking / IB - Comparison of Respondents’ Perception by Age

Age (in Years)

Up to 25 26 - 40 Above 40 Q. No

e-Banking Services

(n=87) (n=216) (n=57)

F value

5.13 5.04 5.39 1.14 1


5.05 5.13 5.63 3.54** 2 Funds transfer

(1.49) (1.48) (0.70)

4.39 4.89 4.37 3.36** 3 Loan transaction

(1.84) (1.81) (1.84)

5.34 5.06 5.42 2.54* 4


5.18 5.11 5.33 0.53 5 Order to buy and sell shares

(1.07) (1.55) (1.61)

4.71 4.56 4.93 0.96 6 Open new accounts

(1.70) (1.92) (1.59)

5.56 5.19 5.70 4.01** 7


Source: Primary Data. Figures in brackets are standard deviation. *Significant at 10% level; **Significant at 5% level.

As reported in the table, the bank customers group with age up to 25 have

perceived all services except “loan transaction” and “Generate the latest reports

168

of banking transactions” as useful (Mean scores are >= 4.50 and < 5.50). The

bank customers with the age group of, up to 25 years and above 40 years have

both perceived “loan transaction” service as “moderately useful” (Mean = 4.39

& 4.37) and “Generate the latest reports of banking transactions” as “very

useful” (Mean = 5.56 & 5.70 “>= 5.50 and < 6.50”). The usefulness of

e-banking services in respect of “loan transaction” is significantly higher

(F value = 3.36, p < 0.05) while in the case of “Generate the latest reports of

banking transactions”, it is significantly less (F value = 4.01, p < 0.05) among

bank customers with the age between 26-40 years compared to the other two age

groups.

For the customer group with the age above 40 years, the fund transfer

through e-banking is found to be “very useful” (Mean = 5.63) and it is

significantly higher compared to that of the other two age groups (F value =

3.54, p < 0.05). Regarding “Pay bills using available cash in the accounts” also,

the customer group with the age between 26-40 years, perceived status of

usefulness is significantly less at marginal level compared to the other two age

groups (F value = 2.54, p < 0.10).

As there is difference in the perceived status of usefulness in respect of 4

out 7 e-banking / IB services by age, it is concluded that usefulness of e-banking

/ internet banking services is depending upon the age of the bank customers.

Table 6.19 presents the F-test results comparing the status of usefulness

by educational status of the bank customers.

169

Table 6.19

Usefulness of e-Banking / IB - Comparison of Respondents’ Perception by Education

Education

Secondary Degree Above Degree

Q. No

e-Banking Services

(n=42) (n=145) (n=173)

F value

5.10 4.73 5.44 8.51*** 1


4.62 5.03 5.46 8.01*** 2 Funds transfer

(1.32) (1.60) (1.15)


(1.95) (1.80) (1.78)

5.64 5.02 5.21 3.62** 4


5.19 5.06 5.24 0.61 5 Order to buy and sell shares

(0.94) (1.38) (1.62)

4.60 4.43 4.87 2.35* 6 Open new accounts

(1.61) (2.01) (1.68)

5.17 5.30 5.45 0.81 7


Source: Primary Data. Figures in brackets are standard deviation. *Significant at 10% level; **Significant at 5% level; ***Significant at 1% level

It can be observed from the table that the “loan transaction” for secondary

educated (Mean = 4.10) and “open new account” for graduates (Mean = 4.43)

are moderately useful. For secondary education, the service like “Pay bills using

available cash in the accounts” through e-banking is “very useful” (Mean=5.64).

Generally, for all educated groups with regard to all the services other than the

above, the e-banking and internet banking is useful (Mean scores are >= 4.50

and < 5.50).

170

From the observation of the significant F values, it is understood that

usefulness of e-banking / IB in respect of “Account details and balance

statements” is significantly less among graduates compared to that of secondary

educated and post graduates (F value = 8.51, p < 0.01).

Also, the level of usefulness of e-banking services like “Fund transfer”

(F value = 8.01, p < 0.01), “loan transaction” (F value = 5.30, p < 0.01) among

secondary educated and extend of using e-banking services such as “Pay bills

using available cash in the accounts” (F value = 3.62, p < 0.05) and “open new

accounts” (F value = 2.35, p < 0.10) among graduates is remarkably less

compared to that of those in the respective other educated groups. On the whole,

from the entire above results, it is found that there is significant difference in the

perceived status of usefulness of e-banking / internet banking services by

educational status of the bank customers.

The results of comparative analysis between usefulness of e-banking /

internet banking services and occupational status of the bank customers are

depicted in Table 6.20.

171

Table 6.20

Usefulness of e-Banking / IB - Comparison of Respondents’ Perception by Occupation

Occupation

Stu

den

t

Hou

sew

ife

Gov

t.

Em

plo

yee

Pri

vate

E

mp

loye

e

Bu

sin

ess

/ S

elf

Em

plo

yed

Q. No

e-Banking Services

(n=55) (n=18) (n=136) (n=120) (n=31)

F value

5.05 5.06 5.01 5.33 4.90 0.88 1

Account details and balance statements (1.67) (0.94) (1.54) (1.56) (1.70)

5.29 4.89 5.15 5.36 4.74 1.56 2 Funds transfer

(1.05) (1.88) (1.29) (1.41) (1.88)

4.53 4.39 4.65 4.79 4.87 0.41 3 Loan transaction

(1.72) (2.52) (1.84) (1.75) (1.88)

5.33 4.89 5.32 4.89 5.65 3.13** 4

Pay bills using available cash in the accounts (1.23) (1.91) (1.26) (1.36) (1.17)

5.15 5.50 5.07 5.23 5.13 0.44 5

Order to buy and sell shares (1.03) (0.92) (1.67) (1.44) (1.45)

4.85 4.17 4.41 4.64 5.74 3.99*** 6 Open new accounts

(1.56) (1.76) (1.93) (1.88) (1.00)

6.02 5.22 5.03 5.44 5.39 4.87*** 7

Generate the latest reports of banking transactions (0.99) (2.13) (1.66) (1.33) (0.67)


From the perusal of the table, it is understood that the e-banking / internet

banking service like “generating the latest reports of banking transaction” is very

useful for student group (Mean = 6.02), “loan transaction” (Mean = 4.39) and

“open new accounts” (Mean = 4.17) is moderately useful for housewife group,

and “Pay bills using available cash in the accounts” is very useful for business /

self employed group (Mean = 5.65).

172

The e-banking service for opening new account is found to be moderately

useful for Government employees (Mean = 4.41) while it is very useful for

business / self-employed group (Mean = 5.74).

Further, from the perusal of F values, it is evident that the perceived status

of usefulness in the case of services like “Pay bills using available cash in the

accounts” (F value = 3.13, p < 0.05), “open new accounts” (F value = 3.99,

p < 0.01) and “generating the latest reports of banking transaction” (F value =

4.87) differ by occupational status of bank customers.

In short, it is found that the extent of usefulness of e-banking services –

“Account details and balance statements”, “Funds transfer”, “Loan transaction”

and “Order to buy and sell shares” is same for all occupational groups whereas

there is significant difference in the usefulness of e-banking services - “Pay bills

using available cash in the accounts”, “open new accounts” and “generating the

latest reports of banking transaction” by occupational status of bank customers.

Table 6.21 presents the mean scores and F values eliciting the statistical

significance of the difference in mean perception among respondent groups with

different levels of family income regarding usefulness of e-banking and internet

banking services.

173

Table 6.21

Usefulness of e-Banking / IB - Comparison of Respondents’ Perception by Income

Income

Up to Rs.10000

Rs.10001 - 25000

> Rs.25000 Q. No

e-Banking Services

(n=119) (n=154) (n=87)

F value

4.61 5.18 5.68 12.80*** 1


4.64 5.30 5.76 18.63*** 2 Funds transfer

(1.87) (1.02) (0.85)


(2.04) (1.74) (1.47)

4.93 5.38 5.18 3.74** 4


4.57 5.41 5.54 16.20*** 5 Order to buy and sell shares

(1.78) (1.15) (1.18)

4.70 4.32 5.21 6.89*** 6 Open new accounts

(1.76) (2.02) (1.34)

4.91 5.69 5.39 10.09*** 7



According to the table, the mean scores for all services except “loan

transaction” ranges between 4.57 and 4.93 (>= 4.50 and 5.50, the range for

“useful”) for the respondent group with family income up to Rs.10000 per

month. In respect of “loan transaction”, the above income group has perceived

“moderately useful” (Mean = 4.18). For respondent group with family income

between Rs.10001 and Rs.25000, the mean scores with regard to all services

except “open new accounts” and “Generate the latest reports of banking

transactions” are in the “useful” range. The above respondent group has

174

perceived the e-banking service for opening new accounts as “moderately

useful” (Mean = 4.32) and generating the latest reports of banking transactions

as “very useful” (Mean = 5.69).

The bank customer group in the sample with family income above

Rs.25000 per month has perceived the “Loan transaction” (Mean = 5.29), “Pay

bills using available cash in the accounts” (Mean = 5.18), “Open new accounts”

(Mean = 5.21) and “Generate the latest reports of banking transactions”

(Mean = 5.39) as “useful”, and “Account details and balance statements”

(Mean = 5.68), “Funds transfer” (Mean = 5.76) and “Order to buy and sell

shares” (Mean = 5.54) as “very useful”.

F values for the difference in group means are significant for all services

through e-banking / internet banking. This has led to the conclusion that the

perceived status of usefulness is associated with monthly income of the bank

customers.

6.4 Intention to use e-Banking / Internet banking in the Future

The bank customers’ opinion about their intention to use e-banking /

Internet banking in the future is obtained using four statements with 7-point

scale (From “Very Strongly Disagree (VSD)”, “Strongly Disagree (SD)”,

“Disagree (D)”, “Neutral (N)”, “Agree (A)”, “Strongly Agree (SA)” to “Very

Strongly Agree (VSA)”) in the questionnaire. The data of the entire sample

were first subjected to descriptive statistics. Then canonical correlation analysis

was used to find out the relationship of benefits and usefulness (of e-banking /

IB) with an intention to use in future. The canonical correlation is the statistical

175

technique used to find out the relationship between two sets of variables – one

dependent set and another independent. The results of the above analysis are

presented and discussed in the remaining part of this chapter.

Table 6.22 shows mean level of opinion of all respondents about their

intention to use e-banking / internet banking in the future.

Table 6.22

Intention to use e-Banking / Internet Banking in the Future – Opinion of Entire Sample

Intention Mean Standard Deviation

I intend to continue using this Internet banking site in the future

5.34 1.29

I expect my use of this Internet banking site to continue in the future

5.41 1.16

I will frequently use this Internet banking site in the future

5.45 1.28

I will strongly recommend others to use this Internet banking site

5.54 1.34

Source: Primary Data.

It can be seen from the table that the mean perception of the entire sample

of the bank customers have agreed that they have intention to continue using this

Internet banking site in the future (Mean = 5.34), expect their use of this Internet

banking site to continue in the future (Mean = 5.41) and frequently use this

Internet banking site in the future (Mean = 5.45) as the mean values are in the

agree range (>= 4.50 and 5.50). At the same time, the respondents have strongly

agreed that they would strongly recommend to others to use this Internet banking

site (Mean = 5.54 >= 5.50 and < 6.50, the range for “strongly agree”). In short,

176

it is found that majority of the bank customers, whether presently use e-banking

or not, have intention to continue using e-banking / internet banking and strongly

recommend to others to use this Internet banking site in the future.

The results of canonical correlation between “intention to use in the

future” and “benefits of e-banking” are presented in Table 6.23 and 6.24. In the

table 6.23, the canonical function and chi-square test statistics indicating the

significance of the function are presented.

Table 6.23

Chi-Square Tests with Successive Roots Removed testing Significance of Overall Model Fit for Canonical Correlation between “Intention to

Use in the Future” and “Benefits of e-Banking”

Canonical Function

Canonical R

Can

onic

al R

2 (E

igen

val

ue)

Chi-Square df p-Value Wilks

Lambda

1 0.6201 0.3845 244.59 16 0.0000 0.5016

2 0.4260 0.1815 72.51 9 0.0000 0.8150

3 0.0637 0.0041 1.52 4 0.8240 0.9957

4 0.0143 0.0002 0.07 1 0.7874 0.9998


There are four canonical functions in the table. Canonical function is

nothing but relationship between two canonical variates, which is similar to

latent variables (factors) in Factor analysis. So, each canonical function has two

canonical variates, one for left set and another for right set of variables. The

strength of relationship between two canonical variates is given by canonical

correlation. Number of canonical function produced by the canonical correlation

177

analysis is equal to number of variables in the smaller set. Here in both left set

(intention to use) and right set (benefits of e-banking), the number of variables is

four. Hence, number of function produced by the analysis is four here.

In the table, it can be observed that out of four canonical functions first

two functions are significant at one per cent level with correlation of 0.6201 and

0.4260. That is, the first and the second pair of canonical variables are

correlated with each other and therefore the first two functions are considered for

final inference.

The variables loadings, also called factor structure matrix or canonical

loadings, with significant canonical functions are reported in Table 6.24. The

canonical loadings are nothing but the correlation between variables in the

analysis and canonical functions.

From the examination of the table, it is understood that, out of four

measures of “intention to use e-banking in the future”, the measure “I intend to

continue using this Internet banking site in the future” has high loading with first

function (0.9784) followed by “I expect my use of this Internet banking site to

continue in the future” (0.8683). The correlation of “I will frequently use this

Internet banking site in the future” with first function is higher than that of

second function. As far as the variables in the second set (benefits of e-banking)

are concerned, only “Save time & Cost Less” is highly correlated with first

canonical function. This indicates that “time saving and less cost” tend to

influence the bank customers’ “intention to continue using this Internet banking

site in the future”.

178

Table 6.24

Variables’ Loadings (Factor Structure Matrix) with Canonical Function – Intention to Use Vs Benefits from e-Banking

Canonical Loadings

Variables First Function

Second Function

Intention to Use e-Banking in the Future

I intend to continue using this Internet banking site in the future

0.9784 0.1065

I expect my use of this Internet banking site to continue in the future

0.8683 -0.2030

I will frequently use this Internet banking site in the future 0.4838 -0.3105

I will strongly recommend others to use this Internet banking site

0.4176 -0.9017

Benefits from e-Banking

Save time & Cost Less 0.9206 -0.0962


0.1498 -0.7016

Flexible and easily accessible with convenience 0.5112 -0.8346


0.1150 -0.5319


The second canonical function, “I will strongly recommend others to use

this Internet banking site” is highly but negatively correlated. In the right set, all

the variables other than “Save time & Cost Less” are highly loaded with second

canonical function, also with negative sign. The variables in both left and right

sets are loaded with the same sign on second function. This reveals that the

benefit of e-banking in providing accurate, relevant and up-to date information,

flexibility and easy accessibility with convenience and assisting to share the

experience with bank and other customers more efficiently tend to influence the

179

bank customers to strongly recommend to others to use e-banking / internet

banking in the future.

Table 6.25 presents the first part of the results of canonical correlation

eliciting number of canonical functions and chi-square test results for the

statistical significance of the functions between “intention to use in the future”

and “usefulness of e-banking”.

Table 6.25

Chi-Square Tests with Successive Roots Removed testing Significance of Overall Model Fit for Canonical Correlation between “Intention to

Use in the Future” and “Usefulness of e-Banking”

Canonical Function

Canonical R

Can

onic

al R

2 (E

igen

val

ue)

Chi-Square

df p-Value Wilks

Lambda

1 0.5941 0.3530 298.5482 28 0.0000 0.4292

2 0.5145 0.2647 144.8614 18 0.0000 0.6634

3 0.2523 0.0637 36.2990 10 0.0001 0.9023

4 0.1907 0.0364 13.0811 4 0.0109 0.9636


As can be seen in the table, all four canonical functions are significant at

one per cent level with shared variance of 35.30 per cent and 26.47 per cent

between canonical variates of left and right set (i.e., common characteristics

between left set and right set canonical variates) in the first and second canonical

functions respectively. Though the third and fourth canonical functions are

fitted significantly, the shared variance is very low in both functions and

180

therefore considered as less important. So, only the first two canonical functions

are considered for final inference.

Table 6.26 is presents the canonical loadings of variables in the left and

right with first and second canonical functions.

Table 6.26

Variables’ Loadings (Factor Structure Matrix) with Canonical Function – Intention to Use Vs Usefulness from e-Banking

Canonical Loadings Variables First

Function Second

Function

Intention to Use e-Banking in the Future

I intend to continue using this Internet banking site in the future 0.9795 -0.1034

I expect my use of this Internet banking site to continue in the future 0.8241 -0.4545

I will frequently use this Internet banking site in the future 0.4753 -0.4560

I will strongly recommend others to use this Internet banking site 0.1980 -0.9516

Usefulness from e-Banking

Account details and balance statements 0.9021 -0.2516

Funds transfer 0.6156 -0.5443

Loan transaction 0.0799 -0.7406

Pay bills using available cash in the accounts 0.2974 -0.7401

Order to buy and sell shares 0.2595 -0.6037

Open new accounts 0.1978 -0.6476

Generate the latest reports of banking transactions 0.2069 -0.6724 Source: Primary Data

From the perusal of the canonical loadings of variables with the first

function, it is apparent that, out of four measures of “intention to use e-banking

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/IB in the future”, the correlation (loading) of “I intend to continue using this

Internet banking site in the future” (0.9795) and “I expect my use of this Internet

banking site to continue in the future” (0.8241) is very high. The correlation of

“I will frequently use this Internet banking site in the future” with both functions

is almost equal. The item “I will strongly recommend others to use this Internet

banking site” is highly loaded with second function.

Among the variables in the right set (Usefulness of e-banking), “Account

details and balance statements” (0.9021) has high loadings followed by “Funds

transfer” (0.6156) with first function. The variable “funds transfer” is also

substantially loaded with second canonical function (-0.5443). All the variables

other than the above are highly loaded with second function. Among the

variables having high loadings with second function, the loadings of “Loan

transaction” (-0.7406) and “Pay bills using available cash in the accounts”

(-0.7401) are higher compared to that of others. It can be further seen that the

sign of the loadings of both left set and right set variables with second canonical

function is negative, indicating that the direction of relationship is same for both

set of variables.

Hence, from the above results, it is found that the bank customers have

intention to continue using e-banking / internet banking in the future” as it is

useful in getting account details and balance statements as well as for

transferring funds. Further, bank customers tend to strongly recommend to

others to use e-banking / internet banking as it is useful for loan transaction,

paying bills using available cash in the accounts, making order to buy and sell

shares and generating latest reports of banking transactions.

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6.5 Conclusion

In this chapter, usefulness and benefits of e-banking / internet banking in

addition to “intention of using e-banking / internet banking in the future” is

evaluated based on the opinion of the bank customers in the sample

(respondents). Factor analysis was used to identify the major benefits of

e-banking / IB. The factor analysis identified four benefits, such as “Save time

& Cost Less”, “Provide accurate, relevant and up-to date information”, “Flexible

and easily accessible with convenience” and “Assists to share the experience

with bank and other customers more efficiently” as major benefits.

The perception of the respondents is compared across categories by type

of banks, nature of users and socio-economic characteristics using t-test and F-

test. From the interpretation of the results, it is found that “flexibility and easy

accessibility with convenience” is the top most benefit followed by “Providing

accurate, relevant and up-to date information” and “Saving time & Cost Less”

and perceived status of the above benefits is associated with education and

family income of the respondents. It is concluded that there is significant

difference in the perceived level of benefits of e-banking / IB between public

and private sector banks as well as between non-users and users of e-banking /

IB.

Regarding usefulness of e-banking / internet banking, it is concluded that

“Generating the latest reports of banking transactions” is the major usefulness

followed by “Funds transfer”, “Pay bills using available cash in the accounts”

and “Order to buy and sell shares”. It is also concluded that the usefulness of e-

banking / IB provided by private sector banks is remarkably higher than that of

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public sector banks. Further, the perceived status of usefulness among non-user

group as well as among rural group is significantly less than that of their

respective counterparts. It is found that the perceived status of usefulness of

e-banking / IB is also related to education and family income of the respondents.

With regard to “intention to use e-banking / internet banking in the

future”, all respondents have expressed positive opinion that they have intention

of using these services in the future. The canonical correlation analysis was used

to find out the relationship of benefits and usefulness of e-banking / internet

banking on intention to use. It is identified from the results of the analysis

between “intention to use” and “benefits” that “time saving and less cost” tend

to influence the bank customers’ “intention to continue using this Internet

banking site in the future” whereas “providing accurate, relevant and up-to date

information”, “flexibility and easy accessibility with convenience” and

“assisting to share the experience with bank and other customers more

efficiently” tend to influence the bank customers to strongly recommend to

others to use e-banking / internet banking in the future”. Similarly from the

results of the canonical analysis between “intention to use” and “usefulness”, it

is concluded that the bank customers have intention to continue using e-banking

/ internet banking in the future” as it is useful in getting account details and

balance statements as well as for transferring funds. Further, it is concluded that

bank customers tend to strongly recommend to others to use e-banking / internet

banking as it is useful for loan transaction, paying bills using available cash in

the accounts, making order to buy and sell shares and generating latest reports of

banking transactions.

usefulness and benefits of e-banking / internet banking...

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