CHAPTER TWO
REVIEW OF RELATED LITERATURE
2.1 CONCEPTUAL FRAMEWORK
E-banking is defined as the automated delivery of new and traditional banking products and services directly to customers through electronic, interactive communication channels. The definition of e-banking varies amongst researches partially because electronic banking refers to several types of services through which bank customers can request information and carry out most retail banking services via computer, television or mobile phone (Daniel, 2003).
The e-banking means transforming the banking and financial industry in terms of the nature of core products /services and the way these are packaged, proposed, delivered and consumed. It is an invaluable and powerful tool driving development, supporting growth, promoting innovation and enhancing competitiveness (Gupta, 2008). Banks and other businesses alike are turning to IT to improve business efficiency, service quality and attract new customers (Kannabiran & Narayan, 2005). Technological innovations have been identified to contribute to the distribution channels of banks and these electronic delivery channels are collectively referred to as electronic banking, (Goi, 2005). The evolution of banking technology has been driven by changes in distribution channels as evidenced by automated teller machine (ATM), phone - banking, tele-banking, PC-banking and most recently internet banking (Chang 2003).
E-banking is the term used for new age banking system. E-banking is also called online banking and it is an outgrowth of PC banking. E-banking uses the internet as the delivery channel by which to conduct banking activity, for example, transferring funds, paying bills, viewing checking and savings account balances, paying mortgages and purchasing financial instruments and certificates of deposits (Mohammed, Siba & Sreekumar, 2009). It is difficult to infer whether the internet tool has been applied for convenience of bankers or for the customers’ convenience. But ultimately it contributes in increasing the efficiency of the banking operation as well providing more convenience to customers. Without even interacting with the bankers, customers transact from one corner of the country to another corner.
Electronic banking has experienced explosive growth and has transformed traditional practices in banking (Gonzalez, 2008). The e- banking is leading to a paradigm shift in marketing practices resulting in high performance in the banking industry. Delivery of service in banking can be provided efficiently only when the background operations are efficient. An efficient background operation can be conducted only when it is integrated by an electronic system. The components like data, hardware, software, network and people are the essential elements of the system. Banking customers get satisfied with the system when it provides them maximum convenience and comfort while transacting with the bank. Internet enabled electronic system facilitate the operation to fetch these result (Maholtra & Singh, 2007).
E banking has become an important channel to sell the products and services and is perceived to be necessity in order to stay profitable and successful (Christopher, Mike, Visit & Amy, 2006). There is a growing interest in understanding the users’ experience, as e-banking is observed to be a larger concept than user satisfaction (Pyun, 2002).
From this perspective, assessing the user experience is essential for many technology products and services (Salehi and Zhila, 2008). Customers have started perceiving the services of bank through internet as a prime attractive feature than any other prime product features of the bank. Customers have started evaluating the banks based on the convenience and comforts it provides to them.
The common definition for electronic banking, and the one used in this research comes from the Basel Committee Report on Banking Supervision (1998), e-banking refers to the provision of retail and small value on us banking products and services through electronic channels. Such products and services can include deposit-taking, lending, account management, the provision of financial advice, electronic bill payment, and the provision of other electronic payment products and services such as electronic money
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