Online banking services

Analyse the perception of bank clients of online banking services offered by the banks


Customer satisfaction has always been a topical issue. Organizations always try to adopt those strategies as to enable them to improve their customer satisfaction level. A mounted customer satisfaction level is believed to be associated with rising profit (Kotler, 1991). Firms also referred to it as a benchmark of their competitive performance. It has also been associated with the executive compensation along with an indicator of improvement of product and service quality. A rise in customer satisfaction level of an organization results in improved customer commitment, better customer retention rates, improved brand loyalty, strong bond among service providers and service recipient, ignorance of normal mistakes on the part of the organization and positive word of mouth.

The concept of quality has always been a concern of focal attention in the academic and research literature. Lewis (1991) reported that during 1980s the concept has received enormous attention and still has been recognized as an issue having strategic value for the organizations operating in service settings. It is relevant for both products and services yet in case of services, where the tangibility, heterogeneity or variability is high, this issue gains more prominence. During a service encounter, if the value received out of the actual experience of the recipient of the service exceeds the expectation of the same person, the service is regarded as a quality service (Asher, 1996). Firoz and Maghrabi (1994) discussed the issue of service quality with reference to rapidly emerging markets. Moreover, the work of Asubonteng et al (1996) exerted that rising hostility of competition results in increased concerns about the quality of services offered by the organization.

The modern era is characterized by widespread adoption of information technology and information technology based products. It involves using technology in processing and managing information in the wider context of organization. Specifically, it incorporates the involvement of computers and related software for converting, storage, protection, processing, transmission and subsequent retrieval of information in the organization. Banking industry across the globe has experienced lot of changes. This was to match the changing world economic trends (Yavas et al., 1997). In such hostile and competitive business situation across the banking industry, the provision of quality services could be a source of getting advantage over rivals (Coskun Samli and Frohlich, 1993). This issue has long being debated in both developed (Herbig and Genestre, 1996) as well as developing countries of the globe (Malhotra et al., 1993). The recent changes in the global banking industry has also resulted in shift in the minds of both Bankers and consumers. It also attracted enormous attention of the researchers. The changes in the technology, competitive profile of the banking industry and dynamic customer requirements posed new distribution channels. Howcroft et al. (2002) embarked that the virtual or paper less transaction environment was proved to be a major source of motivation for the use of e-banking facilities by the clients. Furthermore, it also reduces the chances of error which could otherwise occur. Minimization of disputes between bankers and their clients was reported as another advantage of online banking (Kiang et al., 2000). Similarly, the work of Moutinho et al. (1997) elaborated that e-banking is convenient to the clients as it provides round the clock and throughout the week access to the banks. On the other hand, it also yields cost advantages to the banks as it results in cost saving on the part of the banks (Gerrard and Cunningham, 2003). Further to this, Thornton and White (2001) surveyed 801 customers from financial sector. These customers shared their responses about usage pattern and preferences of distribution channel. Their work highlighted the presence of three different groups of clients which differ on the basis of their preference for channels of distribution. Their work highlighted clients' preference for new distribution channel as it resulted in decrease in number of visits of customers to his banks. Moreover, clients also shared their comfort level with new banking distribution pattern as it prevents them from waiting in the long bank queues. These things have significantly improved the satisfaction level of the customer (Thornton and White, 2001). From the other side of the continuum, it saves banks from investment in office space and many support services employees. The money saved from these areas can be spent in other projects which would be more advantageous for the banks (Birch and Young, 1997).

The survey also revealed that the most popular area where people use e-banking include usage at home and usage at bank premises. Most of the surveyed respondents revealed that they are engaged in e-banking in less than 1 hour a week. Moreover, a very large majority of the respondents indulge in e-banking during last 1 year. A lot of people always transfer their fund using internet yet another vast majority also use it very frequently. Similarly, majority of the respondents always use e-banking for getting new information about new packages offered by the bank. Further to this, another significant portion of the respondents were also engaged in seeking assistance from others in terms of seeking assistance from the bank.

The application of factor loading technique revealed the perceived importance of various factors from the perspective of respondents. It was found the respondents gave importance to problem free links, accurate and quick downloading of web pages, website has unrestricted access to all financial transaction, updated technology for internet banking, web site provide information about transaction and products, website available in your language, reliance on bank for not misusing your information, bank show care in collecting personal information, easy to find all information is fast, site easy to navigate and use, bank willing to help customer, provide information and service promptly, speed of logout of account is fast, knowledge and skill of contact personnel and availability of online customer service representatives. Most of the respondents revealed that they are satisfied or highly satisfied from the e-banking services yet another vast majority revealed their agreement about the satisfaction being normal. Another vast majority shared that they consider the online banking as a substitute of the traditional banking.

Theoretical and Managerial Contribution:

This section of this chapter put forward various managerial as well as academic insights arising out of the dissertation research. The dissertation adopted the context of electronic banking of Pakistan and shared a lot of insights about importance of various factors as felt by the respondents of the dissertation research. the instrument used has got good validity and reliability as revealed through calculation of Cronbach's alpha.

This research also generated significant contributions by putting forward various factors which were relatively parsimonious list of factors that can influence the satisfaction level of the customers. It would help the decision makers in making various strategic moves which enable them to be better in terms of strategy implementation. These strategic moves would improve the level of customer satisfaction.

Limitations of Research:

There are several associated limitations of the dissertation research. First the questionnaire used was adopted from earlier research. Despite all its goodness, the dissertation adopted a questionnaire which was developed for some other research. There might be some issues associated with the adaptation of this questionnaire. The questionnaire was not translated into the native language as it was deemed that users of online banking may be quite conversant in English yet there might be some respondents' biasness towards responding to the questionnaires. Furthermore, the majority of the respondents were from foreign banks. This could also be a reason for emergence of specific findings. Although the research incorporated collection of data from a fairly large sample of the respondents yet a bigger sample may lead to different findings. Furthermore, the sample selection procedures were also non-probability based which has its own peculiarities. Another limitation of the research is the limited scope of the dissertation in terms of geographical coverage. Data was collected from only three cities. The reason behind this was the limited time and finance available for the conduct of the dissertation.

Future Research Areas:

Like any other research, this dissertation also has its associated limitations. The upcoming researchers should overcome the limitations mentioned in the earlier section. Similarly, the research theme put forward in this area along with the findings contributed in this dissertation should be substantiated by later researchers. Another important topic for future research is exploration of the fact why the account holders or the respondents preferred these things. Furthermore, future research should also evaluate the impact of the bank type (Public v/s private and local v/s foreign) on the preferences.


This was the last chapter of the dissertation. It put forward the conclusion based on the findings. In addition to the conclusion which was presented in the form of fulfillment of research objectives, this chapter gave the limitations and future research areas for the research.

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