FINAL PROJECT REPORT ON AWARENESS OF E BANKING AMONG CUSTOMERS

IN PARTIAL FULFILMENT OF THE REQUIRMENT FOR THE AWARD OF THE DEGREE OF MASTERS OF BUSINESS ADMINISTRATION Session (2008-2010)

SUBMITTED TO M s! RAMNEET "AUR LECTURER RIMT-IET

SUBMITTED BY TARANJEET "AUR MBA #T$ Se%! 80802&1'0()

DEPARTMENT OF BUSINESS ADMINISTRATION RIMT*INSTITUTE OF EN+INEERIN+ , TEC$NOLO+Y MANDI +OBIND+AR$

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CERTIFICATE
This is to certify that the project e tit!e" AWARENE## OF E $AN%ING AMONG &U#TOMER#'( is s)*+itte" as a fi a! project report of the re,)ire+e t for the "e-ree of M$A. affi!iate" to the P) ja* Tech ica! U i/ersity. 0a!a "har is a 1or2 carrie" o)t *y Tara jeet %a)r. Ro!!' No' 3434567849:. ) "er +y s)per/isio ; -)i"a ce'

$e-. o/ De0- 1%en1 D ! BIMAL ANJUM

S20e 3iso M s! RAMNEET "AUR

AC"NO4LED+EMENT
I spiratio a " har" 1or2 a!1ays p!aye" a 2ey ro!e i the s)ccess of a y /e t)re' At the !e/e! of practice it is /ery "iffic)!t to -et 2 o1!e"-e 1itho)t -)i"a ce' There is a!1ays a se se of -ratit)"e 1hich o e e<presses to other for the he!pf)! a " ee"y ser/ices that re "er ")ri - a!! phases of !ife' With "eep co se t a " p!eas)re. I 1o)!" !i2e to e<press +y -ratit)"e to a!! those 1ho he!pe" +e i the preparatio of this project' Witho)t their co=operatio the 1or2 1o)!" ot ha/e *ee possi*!e' I 1ish to e<press +y tha 2s to the Mrs'Ra+ eet %a)r. !ect)rer at M $ A "epart+e t of RIMT=I stit)te of E -i eeri - ; Tech o!o-y a " Hea" of Depart+e t Dr' $i+a! A j)+ for his -)i"a ce a " "irectio s' Witho)t his he!p. -)i"a ce a " s)pport this 1o)!" ha/e *ee a /ery "iffic)!t jo*'

TARANJEET "AUR

DECLARATION
I here*y "ec!are that the project e tit!e" >A1are ess of E *a 2i - a+o - c)sto+ers( is e tire!y +y o1 1or2' The st)"y s)*+itte" i partia! f)!fi!!+e t of the re,)ire+e ts for the a1ar" of "e-ree i MASTERS OF BUSINESS ADMINISTRATION (FINANCE). The report is a recor" of *e eficia! st)"y "o e *y +e a " o part of this report has *ee s)*+itte" for the a1ar" of a y "ip!o+a a " "e-ree' The reco++e "atio s are *ase" o +y perso a! j)"-+e t' This report is +y o1 1or2 a " "ata +e tio e" is to the *est of +y 2 o1!e"-e'

TARANJEET "AUR 80802&1'0()

PREFACE
With the rapi" -!o*a!i?atio of the I "ia eco o+y. e terprises are faci - 1ith e/er cha -i co+petiti/e e /iro +e t' E terprises are a"opti - strate-ies ai+e" at "e/e!opi - co+petiti/e a"/a ta-e *ase" o e ha ce" c)sto+er /a!)e i ter+s of pro")ct "iffere tiatio . ,)a!ity. spee". ser/ice a " costs' I the post !i*era!i?atio era. 1ith the "ere-)!atio of I "ia eco o+y. the fi a cia! ser/ice sector 1it essi - a co+p!ete +eta+orphosis a " tech o!o-y is p!ayi - a /ery si- ifica t ro!e i this recor"' O/er the !ast "eca"e I "ia has *ee o e of the fastest a"opters of i for+atio tech o!o-y. partic)!ar!y *eca)se of its capa*i!ity to pro/i"e soft1are so!)tio to or-a i?atio s aro) " the 1or!"' This capa*i!ity has pro/i"e" a tre+e "o)s i+pet)o)s to the "o+estic *a 2i - i ")stry i I "ia to "ep!oy the !atest i tech o!o-y. partic)!ar!y i the I ter et *a 2i - a " e=co++erce are as' $a 2s are -ro1i - i si?e *y +er-ers a " ac,)isitio s. 1hich ha/e *ee "ri/e *y co++) icatio a " tech o!o-y' Tech o!o-y is p!ayi - a +ajor ro!e i i creasi - the efficie cy. co)rtesy a " spee" of c)sto+er ser/ice' It is sai" to *e the a-e of E*a 2i -' A O !i e $a 2i - )ser is e<pecte" to perfor+ at !east o e of the fo!!o1i - tra sactio s o !i e@ 7' &hec2i - acco) t *a!a ce a " tra sactio history 5' Payi - *i!!s 6' Tra sferri - f) "s *et1ee acco) ts A' Re,)esti - cre"it car" a"/a ces 9' Or"eri - chec2s :' Ma a-i - i /est+e ts a " stoc2s tra"i Fro+ a *a 2Bs perspecti/e. )si - the I ter et is +ore efficie t tha )si - other "istri*)tio +e"i)+s *eca)se *a 2s are !oo2i - for a i crease" c)sto+er *ase' Usi - +)!tip!e "istri*)tio
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cha e!s i creases effecti/e +ar2et co/era-e *y e a*!i - "iffere t pro")cts to *e tar-ete" at "iffere t "e+o-raphic se-+e ts' A!so $a 2s ca ot ris2 !oosi - c)sto+ers to co+petitors 1ithi the a--ressi/e co+petitio i the *a 2i - i ")stry aro) " the 1or!"' Moreo/er I ter et "e!i/ery offers c)sto+i?e" ser/ice to s)it the ee"s a " the !i2es of each )ser' Mass c)sto+i?atio happe s effecti/e!y thro)-h O !i e $a 2i -' It re")ces cost a " rep!aces ti+e spe t o ro)ti e erra "s 1ith spe "i - ti+e o *)si ess erra "s' O !i e $a 2i - +ea s !ess staff +e+*ers. s+a!!er i frastr)ct)re "e+a "s. co+pare" 1ith other *a 2i - cha e!s' Fro+ the c)sto+ersB perspecti/e. O !i e $a 2i - pro/i"es a co /e ie t a " effecti/e 1ay to +a a-e fi a ces that is easi!y accessi*!e 5A ho)rs a "ay. se/e "ays a 1ee2' I a""itio i for+atio is )p to "ate' Ne/erthe!ess O !i e $a 2i - has "isa"/a ta-es for *a 2s !i2e ho1 to 1or2 the tech o!o-y. set= )p cost. !e-a! iss)es. a " !ac2 of perso a! co tact 1ith c)sto+ers' A " for c)sto+ers there are sec)rity a " pri/acy iss)es'

INDE5
&ertificate Ac2 o1!e"-e+e t Dec!aratio Preface

7' I tro")ctio CCCCCCCCCCCCCCCCCCCCCCCCCCCC' 7=59 5' Re/ie1 of !iterat)re CCCCCCCCCCCCCCCCCCCCCCCC'''' 5:=64 6' Research Metho"o!o-y CCCCCCCCCCCCCCCCCCCCCCC'' 67=6A A' A a!ysis a " I terpretatio CCCCCCCCCCCCCCCCCCCCCC 69=A6 9' Fi "i -s CCCCCCCCCCCCCCCCCCCCCCCCCCCCC AA A9

:' Li+itatio s 'CCCCCCCCCCCCCCCCCCCCCCCCCCCC'

8' #)--estio s 'CCCCCCCCCCCCCCCCCCCCCCCCCCCC' A: $i*!io-raphy A e<)re

INTRODUCTION
Ear!ier peop!e 1o)!" *e tire" sta "i - i a!o - ,)e)e 1aiti - for a pass*oo2 to *e )p"ate" or they 1o)!" 1ait for the e<t "ay for the "e+a " "raft to *e prepare" *)t o1 I ter et

Tech o!o-y has i /a"e" the porta!s of o)r *a 2i - i stit)tio s a " as the c!ichD -oes e/erythi 1i!! j)st *e a c!ic2 a1ay' No "o)*t. i o/atio s !i2e te!e *a 2i - a " a)to+ate" te!!er +achi es EATMBsF ha/e co si"era*!y p)t c)sto+ers at ease o the rece t past' $)t 1ith et *a 2i - the c)sto+er 1i!! *e a*!e to tra sact 1ith the he!p of a +o)se a " his /isits to the ei-h*orhoo" *a 2 1i!! *eco+e a thi - of the past' I the a-e of e!ectro ic tech o!o-y the re-)!ar app!icatio of co+p)ti -. 1ire!ess

co++) icatio . et1or2i -. etc. i the *a 2i - fie!" has *ro)-ht re/o!)tio ary cha -e i the tra"itio a! 1ays *a 2s "o *)si ess' To"ay. yo)r *a 2 ca ser/e yo) at ho+e. or a!!o1 yo) to ser/e yo)rse!f fro+ a y1here' Go) ca "ra1 yo)r +o ey fro+ ATMBs. yo) ca chec2 yo)r acco) ts thro)-h the I ter et. a " yo) ca pho e the *a 2 to se " yo) a represe tati/e' Not o !y that. yo)r physica! *a 2 1hich is sti!! aro) "=s)""e !y see+s to *e "oi - a !ot +ore thi -s tha j)st *a 2i -' It is tech o!o-y that is +a2i - a!! this possi*!e' I ter et *a 2i - has -ai e" 1i"e accepta ce i ter atio a!!y a " see+s to *e fast catchi - )p i I "ia 1ith +ore a " +ore *a 2s e teri - the fray' This is 1hy. +ost. +ost +o"er *a 2s i stea" of +ere!y "ea!i - 1ith fi a cia! "eposits a " !oa app!y pro+ote. a " "istri*)te the 1a t=satisfyi - pro")cts. ser/ices a " i"eas to start its jo)r ey to1ar"s "e/e!op+e t of co+p)ter a " other tech o!o-y a*ase" "i-ita! eco o+y si ce 7H:4 to e s)re ,)a!ity ser/ice to its c)sto+ers'

E6OLUTION OF E-BAN"IN+
The story of tech o!o-y i *a 2i - starte" 1ith the )se of p) che" car" +achi es !i2e

Acco) ti - Machi es or Le"-er Posti - Machi es' The )se of tech o!o-y. at that ti+e. 1as !i+ite" to 2eepi - *oo2s of the *a 2' It f)rther "e/e!ope" 1ith the *irth of o !i e rea! ti+e syste+ a " /ast i+pro/e+e t i te!eco++) icatio s ")ri - !ate 7H84Bs a " 7H34Bs'it res)!te" i a re/o!)tio i the fie!" of *a 2i - 1ith >co /e ie ce *a 2i -( as a *)??1or"' Thro)-h

&o /e ie ce *a 2i -. the *a 2 is carrie" to the "oorstep of the c)sto+er' The 7HH4Bs sa1 the *irth of "istri*)te" co+p)ti - tech o!o-ies a " Re!atio a! Data $ase Ma a-e+e t #yste+' The *a 2i - i ")stry 1as si+p!y 1aiti - for these tech o!o-ies' No1 1ith "istri*)tio tech o!o-ies. o e co)!" co fi-)re "e"icate" +achi es ca!!e" fro t=e " +achi es for c)sto+er ser/ice a " ris2 co tro! 1hi!e co++) icatio i the *atch +o"e 1itho)t ha+peri - the respo se ti+e o the fro t=e " +achi e' I te se co+petitio has force" *a 2s to rethi 2 the 1ay they operate" their *)si ess' They ha" to rei /e t a " i+pro/e their pro")cts a " ser/ices to +a2e the+ +ore *e eficia! a " cost effecti/e' Tech o!o-y i the for+ of E=*a 2i - has +a"e it possi*!e to fi " a!ter ate *a 2i practices at !o1er costs' More a " +ore peop!e are )si - e!ectro ic *a 2i - pro")cts a " ser/ices *eca)se !ar-e sectio of the *a 2s f)t)re c)sto+er *ase 1i!! *e +a"e )p of co+p)ter !iterate c)sto+er. the *a 2s +)st *e a*!e to offer these c)sto+er pro")cts a " ser/ices that a!!o1 the+ to "o their *a 2i - *y e!ectro ic +ea s' If they fai! to "o this 1i!!. si+p!y. ot s)r/i/e' Ne1 pro")cts a " ser/ices are e+er-i - that are set to cha -e the 1ay 1e !oo2 at +o ey a " the +o etary syste+'

TEC$NOLO+Y *T$E +O6ERNIN+ FACTOR7

It is the tech o!o-y that is +a2i - easy operatio of *a 2s' E/e 74 years *ac2. *a 2s 1o)!" ha/e fo) " it i+possi*!e to pro/i"e e/e *asic *a 2i - ser/ices to +i!!io s of s+a!! a " +e"i)+ c)sto+ers 1ith a!! their *ra ches' At the *ac2 e " tech o!o-y is freei - *a 2 e+p!oyees to co ce trate o /a!)e=a""e" 1or2 rather tha j)st +) "a e ecessities' To"ay. tech o!o-y offers optio s 1here *a 2s ca a!+ost !itera!!y a""ress a +ar2et of o e 1ith a c)sto+i?e" pro")ct or ser/ice' Tho)-h a +o"est start has *ee +a"e i I "ia. et *a 2i - has sti!! a !o - 1ay to -o' This "e/e!op+e t has *ee ac2 o1!e"-e" *y the !atest O !i e $a 2i - Report. 1hich feat)res a !isti - for I&I&I $a 2 '#o+e others ha/e a!so e "ea/ore" to +a2e rea! ti+e *a 2i - a rea!ity *efore this ce t)ry c!oses' Reaso s 1hy e1 pri/ate a " +)!ti= atio a! *a 2s ha/e *ee a*!e to s)r/i/e. thri/e. a " a"apt i !e/era-e o a i creasi -!y co+petiti/e space' These *a 2s 1ere a*!e to

!o1=cost cha e!s s)ch as ATMBs a " Net $a 2i - to the opti+)+ !e/e!s

co tri*)ti - to re")ce" operati - costs' The cost of tra sactio s o/er cha e!s !i2e ATMBs a " the I ter et are !o1er tha "oi - it thro)-h the *ra ches=$a 2s ha/e rea!i?e" that shifti c)sto+er access to !o1er cost cha e!s ca he!p *ri - "o1 operati - costs' These cha e!s are )se" ot o !y to i+pro/e c)sto+er ser/ice *)t a!so to "i/ert traffic fro+ the *ra ches' &)sto+ers )si - ATMBs. pho es a " the I ter et ot o !y a!!o1 *a 2i - tra sactio s. *)t a!so cross=se!!i of other fi a cia! pro")cts a " ser/ices' For e<a+p!e. if the cost of a *ra ch *a 2i - tra sactio is ta2e at Rs744I=. the cost of a ATM tra sactio 1o)!" *e aro) " Rs64I=. pho e *a 2i aro) " Rs54I=. a " i ter et *a 2i - aro) " Rs9I='$)t this "oes ot +ea that *ra ch *a 2i - is o*so!ete' Rather. *a 2s are rei /e ti - their *)si ess +o"e!s to offer e1 fi a cia! ser/ices thro)-h its *ra ches' At the *ac2=e ". tech o!o-y is freei - *a 2 e+p!oyees to co ce trate o /a!)e=a""e" 1or2 rather tha j)st +) "a e ecessities' I co+p)teri?e" *a 2s. o ce a
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tra sactio is poste" it is a)to=reco ci!e"' This syste+ is easy a " frees peop!e to co ce trate o other c)sto+er ser/ices'

NE4 $ORI8ONS
The i+porta t factor that is ca)si - a shift i the i ")stry is that of co /e ie ces for the co s)+er' Peop!e ee" ti+e!y access to *a 2i - ser/ices. a " ha/e !ess ti+e to spe " at *a 2s. a " prefer the co /e ie ce of !o - "ista ce *a 2i -' Of co)rse. societyBs /ie1 of 1hat is co /e ie t is cha -i - 'Peop!e 1ere acc)sto+e" to associati - co /e ie ce 1ith "oi - *)si ess i their ei-h*orhoo". a " ot tra/e!i - to a *a 2 across to1 ' No1. ho1e/er. society has a "iffere t "efi itio of *a 2 co /e ie ce' A!so. 1e sho)!" +e tio it is "irect!y ")e to +er-ers that *a 2s are a*!e to offer +ore f)!! ser/ice *ra ches. a " ATM +achi es' This is +ore co /e ie t to the c)sto+ers. a " creates *a 2 !oya!ty'I crease" )se i ATMBs . the -ro1i - )se of ho+e a " office co+p)ters. fa< +achi es. a " poi t of sa!e ter+i a!s a!!o1i - co s)+ers to +a2e tra sactio e!ectro ica!!y is o1 co si"ere" co /e ie t' Th)s. *ra ch !ocatio is o !o -er a priority fro+ the co s)+erBs /ie1' The /ario)s *a 2s 1hich ha/e a"opte" 1ith corporate -i/i - soft1are a " so!)tio a " ser/ices as of "ate are as fo!!o1s@ B-n9 N-%e A$N AMRO $a 2 A*) Dha*i &o++ercia! $a 2 $a 2 of I "ia &iti*a 2 &orporatio $a 2 Fe"era! $a 2 G!o*a! Tr)st $a 2 HDF& $a 2 I&I&I $a 2 Te:;no<o=> 6en.o I fosys E$a 2 A1ayF I fosys E$a 2 A1ayF I=f!e< Or*itech E o1 Po!aris I=f!e< #a che? I fosys E$a 2A1ayF i=f!e<I #atya+ I fosys. I&I&I I fotech Se 3i:e o//e in= Net$a 2i AD&$ NetLi 2 $OIo !i e &iti*a 2 O !i e &orpNet Fe"Net i*a 2J-t* Net$a 2i I fi ity
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ID$I $a 2 I ")sI " $a 2 P) ja* Natio a! $a 2 #ta "ar" &hartere" $a 2 #tate $a 2 of I "ia UTI $a 2

I fosys E$a 2 A1ayF &R5 I fosys E$a 2 A1ayF I =Ho)se #atya+I$roa"/isio I fosys E$a 2 A1ayF

i= et *a 2i I ")sNet I ter et $a 2i Me #ta "ar" &hartere" O !i e o !i es*i'co+ I co ect

NEED FOR E-BAN"IN+

O e has to approach the *ra ch i perso . to 1ith"ra1 cash or "eposit a che,)e or re,)est a state+e t of acco) ts' I tr)e I ter et *a 2i -. a y i ,)iry or tra sactio is processe" o !i e 1itho)t a y refere ce to the *ra ch Ea y1here *a 2i -F at a y ti+e' Pro/i"i - I ter et *a 2i is i creasi -!y *eco+i - a K ee" to ha/eK tha a K ice to ha/eK ser/ice' The et *a 2i -. th)s. o1 is +ore of a or+ rather tha a e<ceptio i +a y "e/e!ope" co) tries ")e to the fact that it is the cheapest 1ay of pro/i"i - *a 2i - ser/ices' $a 2s ha/e tra"itio a!!y *ee i the forefro t of har essi - tech o!o-y to i+pro/e their )si - e!ectro ic a "

pro")cts. ser/ices a " efficie cy' They ha/e. o/er a !o - ti+e. *ee te!eco++) icatio

et1or2s for "e!i/eri - a 1i"e ra -e of /a!)e a""e" pro")cts a " ser/ices' ectio s. pri/ate et1or2s. p)*!ic et1or2s etc

The "e!i/ery cha e!s i c!)"e "irect "ia! L )p co

a " the "e/ices i c!)"e te!epho e. Perso a! &o+p)ters i c!)"i - the A)to+ate" Te!!er Machi es. etc' With the pop)!arity of P&s. easy access to I ter et a " Wor!" Wi"e We* EWWWF. I ter et is i creasi -!y )se" *y *a 2s as a cha e! for recei/i - i str)ctio s a " "e!i/eri - their pro")cts a " ser/ices to their c)sto+ers' This for+ of *a 2i - is -e era!!y referre" to as I ter et $a 2i -. a!tho)-h the ra -e of pro")cts a " ser/ices offere" *y "iffere t *a 2s /ary 1i"e!y *oth i their co te t a " sophisticatio '

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E- BAN"IN+ SER6ICES
The fo!!o1i - are the /ario)s e=*a 2i - ser/ices 1! BILL PAYMENT SER6ICE Each *a 2 has tie=)ps 1ith /ario)s )ti!ity co+pa ies. ser/ice pro/i"ers a " i s)ra ce co+pa ies. across the co) try' It faci!itates the pay+e t of e!ectricity a " te!epho e *i!!s. +o*i!e pho e. cre"it car" a " i s)ra ce pre+i)+ *i!!s' To pay *i!!s. a si+p!e o e=ti+e re-istratio for each *i!!er is to *e co+p!ete"' #ta "i - i str)ctio s ca *e set. o !i e to pay rec)rri - *i!!s. a)to+atica!!y' O e=ti+e sta "i - i str)ctio 1i!! e s)re that *i!! pay+e ts "o ot -et "e!aye" ")e to !ac2 of ti+e' Most i teresti -!y. the *a 2 "oes ot char-e c)sto+ers for o !i e *i!! pay+e t' 2! FUND TRANSFER A y a+o) t ca *e tra sferre" fro+ o e acco) t to a other of the sa+e or a y a other *a 2' &)sto+ers ca se " +o ey a y1here i I "ia' PayeeBs acco) t )+*er. his *a 2 a " the *ra ch is ee"e" to *e +e tio e" after !o--i - i the acco) t' The tra sfer 1i!! ta2e p!ace i a "ay or so. 1hereas i a tra"itio a! +etho". it ta2es a*o)t three 1or2i - "ays' I&I&I $a 2 says that o !i e *i!! pay+e t ser/ice a " f) " tra sfer faci!ity ha/e *ee ser/ices' &! CREDIT CARD CUSTOMERS &re"it car" )sers ha/e a !ot i store' With I ter et *a 2i -. c)sto+ers ca ot o !y pay their their +ost pop)!ar o !i e

cre"it car" *i!!s o !i e *)t a!so -et a !oa o their car"s' Not j)st this. they ca a!so app!y for a a""itio a! car". re,)est a cre"it !i e i crease a " Go" for*i" if yo) !ose yo)r cre"it car". yo) ca report !ost car" o !i e' #! RAIL4AY PASS

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This is so+ethi - that 1o)!" i terest a!! the aa+ ja ta' I "ia Rai!1ays has tie" )p 1ith I&I&I *a 2 a " yo) ca o1 +a2e yo)r rai!1ay pass for !oca! trai s o !i e' The pass 1i!! *e "e!i/ere"

to yo) at yo)r "oorstep' $)t the faci!ity is !i+ite" to M)+*ai. Tha e. Nasi2. #)rat a " P) e' The *a 2 1o)!" j)st char-e Rs 74 M 75'5A perce t of ser/ice ta<' (! IN6ESTIN+ T$ROU+$ INTERNET BAN"IN+ Ope i - a fi<e" "eposit acco) t ca ot -et easier tha this' A FD ca *e ope e" o !i e thro)-h f) "s tra sfer' O !i e *a 2i - ca a!so *e a -reat frie " for !a?y i /estors' No1 i /estors 1ith i ter!i 2e" "e+at acco) t a " *a 2 acco) t ca easi!y tra"e i the stoc2 +ar2et a " the a+o) t 1i!! *e a)to+atica!!y "e*ite" fro+ their respecti/e *a 2 acco) ts a " the shares 1i!! *e cre"ite" i their "e+at acco) t' Moreo/er. so+e *a 2s e/e -i/e the faci!ity to p)rchase +)t)a! f) "s "irect!y fro+ the o !i e *a 2i - syste+' #o it re+o/es the 1orry a*o)t fi!!i - those *i- for+s for +)t)a! f) "s. they 1i!! o1 *e j)st a fe1 c!ic2s a1ay' No1a"ays. +ost !ea"i - *a 2s offer *oth o !i e *a 2i - a " "e+at acco) t' Ho1e/er if the c)sto+er ha/e there "e+at acco) t 1ith i "epe "e t share *ro2ers. the ee" to si- a specia! for+. 1hich 1i!! !i 2 yo)r t1o acco) ts'

)! REC$AR+IN+ YOUR PREPAID P$ONE No1 there is o ee" to r)sh to the /e "or to rechar-e the prepai" pho e. e/ery ti+e the ta!2 ti+e r) s o)t' 0)st top=)p the prepai" +o*i!e car"s *y !o--i - i to I ter et *a 2i -' $y j)st se!ecti - the operatorNs a+e. e teri - the +o*i!e )+*er a " the a+o) t for rechar-e. the pho e is a-ai *ac2 i actio 1ithi fe1 +i )tes' '! S$OPPIN+ AT YOUR FIN+ERTIPS

14

Lea"i - *a 2s ha/e tie )ps 1ith /ario)s shoppi - 1e*sites' With a ra -e of a!! 2i " of pro")cts. o e ca shop o !i e a " the pay+e t is a!so +a"e co /e ie t!y thro)-h the acco) t' O e ca a!so *)y rai!1ay a " air tic2ets thro)-h I ter et *a 2i -'

E-BAN"IN+ PRODUCTS
The /ario)s pro")cts of e=*a 2i - are as fo!!o1s A21o%-1e. Te<<e M-:;ine (ATM F These are cash "ispe si - +achi e. 1hich are fre,)e t!y see at *a 2s a " other !ocatio s s)ch as shoppi - ce ters a " *)i!"i - societies' Their +ai p)rpose is to a!!o1 c)sto+er to "ra1 cash at a y ti+e a " to pro/i"e *a 2i - ser/ices 1here it 1o)!" ot ha/e *ee /ia*!e to ope a other *ra ch e'-' o ) i/ersity ca+p)s' A -21o%-1e. 1e<<e %-:;ine or -21o%-1i: 1e<<e %-:;ine EATMF is a co+p)teri?e"

te!eco++) icatio s "e/ice that pro/i"es a fi a cia! i stit)tio Ns c)sto+ers a +etho" of fi a cia!O tra sactio s i a p)*!ic space 1itho)t the ee" for a h)+a c!er2 or *a 2 te!!er' O +ost +o"er ATMs. the c)sto+er i"e tifies hi+ or herse!f *y i serti - a p!astic ATM car" 1ith a +a- etic stripe or a p!astic s+artcar" 1ith a chip that co tai s his or her car" )+*er a " so+e sec)rity i for+atio . s)ch as a e<piratio "ate or &P& E&PPF' #ec)rity is pro/i"e" *y the c)sto+er e teri - a perso a! i"e tificatio )+*er EPINF' Usi - a ATM. c)sto+ers ca

access their *a 2 acco) ts i or"er to +a2e cash 1ith"ra1a!s Eor cre"it car" cash a"/a cesF a " chec2 their acco) t *a!a ces' Ma y ATMs a!so a!!o1 peop!e to "eposit cash or chec2s. tra sfer +o ey *et1ee their *a 2 acco) ts. pay *i!!s. or p)rchase -oo"s a " ser/ices' ATMs are 2 o1 *y /ario)s cas)a! ter+s i c!)"i - cash +achi e. ho!e=i =the=1a!!. cash poi t or $a co+at Ei

15

E)rope a " R)ssiaF' The occasio a!!y=)se" ATM Machi e is a e<a+p!e of RA# sy "ro+e' #o+e of the a"/a ta-es of ATM to c)sto+ers are@= Q A*i!ity to "ra1 cash after or+a! *a 2i - ho)rs Q Q)ic2er tha or+a! cashier ser/ice

Q &o+p!ete sec)rity as o !y the car" ho!"er 2 o1s the PIN Q Does ot j)st operate as a +e"i)+ of o*tai i - cash' Q &)sto+er ca so+eti+es )se the ser/ices of other *a 2 ATMBs' Te<e?-n9in= o P;one B-n9in= Te!epho e *a 2i - is re!ati/e!y e1 E!ectro ic $a 2i - Pro")ct' Ho1e/er it is fast!y *eco+i o e of the +ost pop)!ar pro")cts' &)sto+er ca perfor+ a )+*er of tra sactio s fro+ the co /e ie ce of their o1 ho+e or officeR i fact fro+ a y1here they ha/e access to pho e' &)sto+ers ca "o fo!!o1i -@= Q &hec2 *a!a ces a " state+e t i for+atio Q Tra sfer f) "s fro+ o e acco) t to a other Q Pay certai *i!!s Q Or"er state+e ts or che,)e *oo2s Q De+a " "raft re,)est This faci!ity is a/ai!a*!e 1ith the he!p of Poice Respo se #yste+ EPR#F' This syste+ *asica!!y. accepts o !y TONE "ia!e" i p)t' Li2e the ATM c)sto+er has to fo!!o1 partic)!ar process. i itia!!y acco) t )+*er a " te!epho e PIN are fe" for the process to start' A!so the PR# syste+ pro/i"es the )sers 1ithi a""itio a! faci!ities s)ch as cha -i - e<isti - pass1or" 1ith the e1 "esire". i for+atio a*o)t e1 pro")cts. c)rre t i terest rates etc' Mo?i<e B-n9in=

16

Mo*i!e *a 2i - co+es i as a part of the *a 2s i itiati/e to offer +)!tip!e cha e! *a 2i pro/i"i - co /e ie ce for its c)sto+er' A /ersati!e +)!tif) ctio a!. free ser/ice that is accessi*!e a " /ie1a*!e o the +o itor of +o*i!e pho e' Mo*i!e pho es are p!ayi - -reat ro!e i I "ia *a 2i -= *oth "irect!y a " i "irect!y' They are *ei - )se" *oth as *a 2i - a " other cha e!s' In1e ne1 B-n9in= The a"/e t of the I ter et a " the pop)!arity of perso a! co+p)ters prese te" *oth a opport) ity a " a cha!!e -e for the *a 2i - i ")stry' For years. fi a cia! i stit)tio s ha/e )se" po1erf)! co+p)ter et1or2s to a)to+ate +i!!io of "ai!y tra sactio sR to"ay. ofte the o !y paper recor" is the c)sto+erBs receipt at the poi t of sa!e' No1 that their c)sto+ers are co ecte" to the I ter et /ia perso a! co+p)ters. *a 2s e /isio si+i!ar a"/a ta-es *y a"opti -

those sa+e i ter a! e!ectro ic processes to ho+e )se' $a 2s /ie1 o !i e *a 2i - as a po1erf)! >/a!)e a""e"( too! to attract a " retai 1hi!e he!pi - to e!i+i ate cost!y paper ha "!i - a " te!!er i teractio s i a e1 c)sto+ers i creasi -!y

co+petiti/e *a 2i - e /iro +e t' I I "ia first o e to +o/e i to this area 1as I&I&I $a 2' They starte" 1e* *ase" *a 2i - as ear!y as a)-)st 7HH8'

TYPES OF INTERNET BAN"IN+ OR E-BAN"IN+

U "ersta "i - the /ario)s types of I ter et *a 2i - 1i!! he!p e<a+i ers assess the ris2s

i /o!/e"' &)rre t!y. the fo!!o1i - three *asic 2i "s of I ter et *a 2i - are *ei - e+p!oye" i the +ar2etp!ace' INFORMATIONAL- this is the *asic !e/e! of I ter et *a 2i -' Typica!!y. the *a 2 has +ar2eti - i for+atio a*o)t the *a 2Bs pro")cts a " ser/ices o a sta "=a!o e ser/er' The ris2

17

is re!ati/e!y !o1. as i for+atio a! syste+s typica!!y ha/e o path *et1ee the ser/er a " the *a 2Bs i ter a! et1or2' This !e/e! of I ter et *a 2i - ca *e pro/i"e" *y the *a 2s or

o)tso)rce"' Whi!e the ris2 to a *a 2 is re!ati/e!y !o1. the ser/er or 1e* site +ay *e /)! era*!e to a!teratio ' Appropriate co tro!s therefore +)st *e i p!ace to pre/e t ) a)thori?e" a!teratio s to the *a 2Bs ser/er or 1e* site' COMMUNICATI6E- This type of I ter et *a 2i - syste+s a " the c)sto+er 'The i teractio *et1ee the *a 2Bs syste+ a " the c)sto+er 'The i teractio +ay *e !i+ite" to e!ectro ic +ai!. acco) t e ,)iry. !oa app!icatio s. or static fi!e )p"ates E a+e a " a""ress cha -eF' $eca)se these ser/ers +ay ha/e a path to the *a 2Bs i ter a! et1or2s. the ris2 is hi-her 1ith this co fi-)ratio tha 1ith i for+atio a! syste+s' Appropriate co tro!s ee" to *e i the p!ace to pre/e t. +o itor. a " a!ert +a a-e+e t of a y ) a)thori?e" atte+pt to access the *a 2Bs i ter a! et1or2s a " co+p)ter syste+s' Pir)s co tro!s a!so *eco+e +)ch +ore critica! i this e /iro +e t' TRANSACTIONAL- this !e/e! of I ter et *a 2i - a!!o1s c)sto+ers to e<ec)te tra sactio s' #i ce a path typica!!y e<ists *et1ee the ser/er a " the *a 2 or o)tso)rcerBs i ter a! et1or2. this is the hi-hest ris2 architect)re a " +)st ha/e the stro -est co tro!s' &)sto+er tra sactio s ca i c!)"e accessi - acco) ts. payi - *i!!s. tra sferri - f) "s etc'

AD6ANTA+ES OF INTERNET BAN"IN+

7' CON6ENIENCE= U !i2e yo)r cor er *a 2. o !i e *a 2i - sites e/er c!ose' They are a/ai!a*!e 5A ho)rs a "ay. se/e "ays a 1ee2. a " theyBre o !y a +o)se c!ic2 a1ay' 5' UBI@UITY= If yo)Bre o)t of state or e/e o)t of the co) try 1he a +o ey pro*!e+ arises. yo) ca !o- o i sta t!y to yo)r o !i e *a 2 a " ta2e care of *)si ess. 5AO8'

18

6' TRANSACTION SPEED= O !i e *a 2 sites -e era!!y e<ec)te a " co fir+ tra sactio s at or ,)ic2er tha ATM processi - spee"s' A' EFFICIENCY-Go) ca access a " +a a-e a!! of yo)r *a 2 acco) ts. i c!)"i - IRABs. &Ds. e/e sec)rities. fro+ o e sec)re site' 9' EFFECTI6ENESS- Ma y o !i e *a 2i - sites o1 offer sophisticate" too!s. i c!)"i acco) t a--re-atio . stoc2 ,)otes. rate a!ert a " portfo!io +a a-i - pro-ra+ to he!p yo) +a a-e a!! of yo)r assets +ore effecti/e!y' Most are a!so co+pati*!e 1ith +o ey +a a-i - pro-ra+s s)ch as ,)ic2e a " Microsoft +o ey'

DISAD6ANTA+ES OF INTERNET BAN"IN+

7F START-UP MAY TA"E TIME=I or"er to re-ister for yo)r *a 2Bs o !i e pro-ra+. yo) 1i!! pro*a*!y ha/e to pro/i"e ID a " si- a for+ at a *a 2 *ra ch' If yo) a " yo)r spo)se 1ish to /ie1 a " +a a-e their assets to-ether o !i e. o e of yo) +ay ha/e to sia ")ra*!e po1er of attor ey *efore the *a 2 1i!! "isp!ay a!! of yo)r ho!"i -s to-ether' 5F LEARNIN+ CUR6ES= $a 2i - sites ca *e "iffic)!t to a/i-ate at first' P!a to i /est so+e ti+e a "Oor rea" the t)toria!s i or"er to *eco+e co+forta*!e i yo)r /irt)a! !o**y' 6F BAN" SITE C$AN+ES- E/e the !ar-est *a 2s perio"ica!!y )p-ra"e their o !i e pro-ra+s. a""i - e1 feat)res i ) fa+i!iar p!aces' I so+e cases. yo) +ay ha/e to re= e ter acco) t i for+atio '

INTERNET BAN"IN+ 6ERSUS TRADITIONAL BAN"IN+

I spite of so +a y faci!ities that I ter et *a 2i - offers )s. 1e sti!! see+ to tr)st o)r tra"itio a! +etho" of *a 2i - a " is re!)cta t to )se o !i e *a 2i -' $)t here are fe1 cases 1here I ter et
19

*a 2i - 1i!! t)r o)t to *e a *etter optio i ter+s of sa/i - yo)r +o ey' N#top pay+e tN "o e thro)-h I ter et *a 2i - 1i!! ot cost a y e<tra fees *)t 1he "o e thro)-h the *ra ch. the *a 2 +ay char-e yo) Rs 94 per che,)e p!)s the ser/ice ta<' Thro)-h I ter et *a 2i -. yo) ca chec2 yo)r tra sactio s at a y ti+e of the "ay. a " as +a y ti+es as yo) 1a t to' O the other ha ". i a tra"itio a! +etho". yo) -et ,)arter!y state+e ts fro+ the *a 2 a " if yo) re,)est for a state+e t at yo)r re,)ire" ti+e. it +ay t)r o)t to *e a e<pe si/e affair' The *ra ch +ay char-e yo) Rs 59 per pa-e. 1hich i c!)"es o !y 64 tra sactio s' Moreo/er. the *a 2 *ra ch 1o)!" ta2e ei-ht "ays to "e!i/er it at yo)r "oorstep' If the f) " tra sfer has to *e +a"e o)tstatio . 1here the *a 2 "oes ot ha/e a *ra ch. the *a 2 1o)!" "e+a " o)tstatio char-es' Whereas 1ith the he!p of o !i e *a 2i -. it 1i!! *e a*so!)te!y free for yo)' As per the I ter et a " Mo*i!e Associatio of I "iaNs report o o !i e *a 2i - 544:. KThere are +a y a"/a ta-es of o !i e *a 2i -' It is co /e ie t. it is Nt *o) " *y operatio a! ti+i -s. there are o -eo-raphica! *arriers a " the ser/ices ca *e offere" at a +i isc)!e cost'K

IMPACT OF E-BAN"IN+ ON TRADITIONAL SER6ICES

O e of the iss)es c)rre t!y *ei - a""resse" is the i+pact of e=*a 2i - o tra"itio a! *a 2i p!ayers' After a!!. if there are ris2s i here t i -oi - i to e=*a 2i - there are other ris2s i ot

"oi - so' It is too ear!y to ha/e a fir+ /ie1 o this yet' E/e to practitio ers the f)t)re of e= *a 2i - a " its i+p!icatio s are ) c!ear' It +i-ht *e co /e ie t e/erthe!ess to o)t!i e *rief!y t1o /ie1s that are pre/a!e t i the +ar2et' The /ie1 that the I ter et is a re/o!)tio that 1i!! s1eep a1ay the o!" or"er ho!"s +)ch s1ay' Ar-)+e ts i fa/or are as fo!!o1s@ E=*a 2i -

20

tra sactio s are +)ch cheaper tha

*ra ch or e/e

pho e tra sactio s' This co)!" t)r

yester"ayBs co+petiti/e a"/a ta-e = a !ar-e *ra ch et1or2 = i to a co+parati/e "isa"/a ta-e. a!!o1i - e=*a 2s to ) "erc)t *ric2s=a "=+ortar *a 2s' This is co++o !y 2 o1 as the K*eache" "i osa)rK theory' E=*a 2s are easy to set )p so !ots of e1 e tra ts 1i!! arri/e' SO!"=1or!"B syste+s. c)!t)res a " str)ct)res 1i!! ot e c)+*er these e1 e tra ts' I stea". they 1i!! *e a"apta*!e a " respo si/e' E=*a 2i - -i/es co s)+ers +)ch +ore choice' &o s)+ers 1i!! *e !ess i c!i e" to re+ai !oya!'E=*a 2i - 1i!! !ea" to a erosio of the Se "o1+e t effectB c)rre t!y e joye" *y the +ajor U% *a 2s' Deposits 1i!! -o e!se1here 1ith the co se,)e ce that these *a 2s 1i!! ha/e to fi-ht to re-ai a " retai their c)sto+er *ase' This 1i!! i crease their cost of f) "s. possi*!y +a2i - their *)si ess !ess /ia*!e' Lost re/e )e +ay e/e res)!t i these *a 2s ta2i - +ore ris2s to *reach the -ap' Porta! pro/i"ers are !i2e!y to attract the +ost si- ifica t share of *a 2i - profits' I "ee" *a 2s co)!" *eco+e -!orifie" +arria-e *ro2ers' They 1o)!" si+p!y *ri - t1o parties to-ether L e*)yer a " se!!er. payer a " payee' The pro")cts 1i!! *e pro/i"e" *y +o o!i es. e<perts i their fie!"' Tra"itio a! *a 2s +ay si+p!y *e !eft 1ith pay+e t a " sett!e+e t *)si ess L e/e this co)!" *e cast i to "o)*t' Tra"itio a! *a 2s 1i!! fi " it "iffic)!t to e/o!/e' Not o !y 1i!! they *e ) a*!e to +a2e ac,)isitio s for cash as oppose" to *ei - a*!e to offer shares. they 1i!! *e ) a*!e to o*tai a""itio a! capita! fro+ the stoc2 +ar2et' This is i co trast to the sit)atio for I ter et fir+s for 1ho+ it see+s re!ati/e!y easy to attract i /est+e t' There is of co)rse a other /ie1 1hich sees e=*a 2i - +ore as a e/o!)tio tha a re/o!)tio ' E= *a 2i - is j)st *a 2i - offere" /ia a e1 "e!i/ery cha e!' It si+p!y -i/es co s)+ers a other ser/ice Ej)st as ATMs "i"F' Li2e ATMs. e=*a 2i - 1i!! i+pact o the at)re of *ra ches *)t 1i!!

21

ot re+o/e their /a!)e' E<perie ce i #ca "i a/ia Ear-)a*!y the +ost a"/a ce" e=*a 2i - area i the 1or!"F appears to co fir+ that the f)t)re is Sc!ic2s a " +ortarB *a 2i -' &)sto+ers 1a t f)!! ser/ice *a 2i - /ia a )+*er of "e!i/ery cha e!s' The f)t)re is therefore SMarti i $a 2i -B Ea y ti+e. a y p!ace. a y1here. a yho1F' Tra"itio a! *a 2s are starti - to fi-ht *ac2' The start= )p costs of a e=*a 2 are hi-h' Esta*!ishi - a tr)ste" *ra " is /ery cost!y as it re,)ires a""itio to the p)rchase of e<pe si/e tech o!o-y Eas

si- ifica t a"/ertisi - e<pe "it)re i

sec)rity a " pri/acy are 2ey to -ai i - c)sto+er appro/a!F' E=*a 2s ha/e a!rea"y fo) " that retai! *a 2i - o !y *eco+es profita*!e o ce a !ar-e critica! +ass is achie/e"' &o se,)e t!y +a y e=*a 2s are !i+iti - the+se!/es to pro/i"i - a tai!ore" ser/ice to the *etter off' No*o"y rea!!y 2 o1s 1hich of these /ersio s 1i!! tri)+ph' This is so+ethi that the +ar2et 1i!! "eter+i e' Ho1e/er. s)per/isors 1i!! ee" to pay c!ose atte tio to the i+pact of e=*a 2s o the tra"itio a! *a 2s. for e<a+p!e *y s)r/ei!!a ce of@ Q strate-y Q c)sto+er !e/e!s Q ear i -s a " costs Q a"/ertisi - spe "i Q +ar-i s Q f) "i - costs Q Mer-er opport) ities a " threats. *oth i the U% a " a*roa"'

PROMISES OF INTERNET BAN"IN+

22

As the pote tia! that the i ter et he!" to tra sfor+ "iffere t aspects of o)r !i/es +a ifeste" itse!f. it 1as forecast that its i+pact o fi a cia! ser/ices s)ch as stoc2=*ro2i - a " *a 2i - 1o)!" *e especia!!y profo) "' $a 2i - tra sactio s co)!" *e co ")cte" e tire!y i a /irt)a! co te<t 1ith o physica! e<cha -e ecessary' A!so tra sactio s are to a !ar-e e<te t sta "ar" 1ith !itt!e. apart fro+ price. "iffere ce *et1ee *a 2s' For *oth these reaso s *a 2i - 1as especia!!y 1e!! s)ite" to )se the I ter et' It pro+ise" to create a perfect!y co+petiti/e e!ectro ic +ar2etp!ace for *a 2i - pro")cts= 1ith perfect i for+atio a*o)t pro")cts R!ar-er )+*er of *)yers a " se!!ersR a " re")ce" tra sactio costs'T

1! No 0;>si:-< :;-n=e Historica!!y. as the +ea s of pay+e t s)*stit)te" -o!" *y paper c)rre cy a " paper c)rre cy *y p!astic a " fi a!!y p!astic *y "irect "e*its. the i for+atio i te sity 2ept i creasi -' I the case of *)yi - physica! -oo"s o !i e. a !ar-e portio of the /a!)e to the c)sto+er is "eri/e" o !y after the -oo"s are physica!!y "e!i/ere"' The i ter et *ri -s s)pp!e+e ta! /a!)e *y ai"i - the search process. +a2i - co+pariso s efficie t a " a)to+ati - or"er p!ace+e t a " *i!!i -' O the other ha ". i "eter+i i - 1hich *a 2 to p!ace a "eposit 1ith. ot o !y ca the search *e "o e o !i e *)t the act)a! pro")ct "e!i/ery E"eposit *oo2i -F ca a!so *e affecte" o !i e' #i ce there is hi-h i for+atio i te sity a " o physica! e<cha -e. the i ter et as a "e!i/ery cha e! is respo si*!e for "e!i/eri - a !ar-e portio of the /a!)e for a c)sto+er' More i+porta t!y. the e "=to=e " process ca *e co+p!ete" e tire!y o !i e' 2! Re.2:e. 1 -ns-:1ion :os1s

23

A""itio a!!y /ario)s st)"ies sho1e" that as a "e!i/ery or "istri*)tio

cha e!. the

I ter et co)!" *ri - s)*sta tia! cost a"/a ta-es for *a 2s' &o s)!ta ts $oo?=A!!e ; Ha+i!to esti+ate" that 1hereas the cost of a c)sto+er 1a!2i - i to the *ra ch a " o the i ter et is a

)si - a te!!er is U#D 7'47. the cost of co ")cti - the sa+e tra sactio

te th of that a " is c!ose to U#D 4'74'This 1as a!so co si"era*!y !o1er tha the cost of co ")cti - the tra sactio o/er the te!epho eEU#D 4'95F or ha/i - a c)sto+er /isit a ATM EU#D 4'58F' #i- ifica t!y. tra sactio costs o/er the i ter et are a!so !o1er tha the cost of a c)sto+er accessi - the *a 2 o/er a "e"icate" te!epho e !i e )si - a +o"e+' The $oo?=A!!e st)"y 1as ,)ote" i +a y co++e taries that "escri*e" the i+pact of the I ter et o *a 2i -. i c!)"e" o e *y the U ite" #tates Depart+e t of &o++erce' There 1as a si+i!ar st)"y o the costs of "e!i/eri - *a 2i - ser/ices across "iffere t cha e!s co ")cte" *y the I$M &o s)!ta cy Gro)p' A!tho)-h the a*so!)te costs that they esti+ate" for each cha e! 1ere "iffere t fro+ $oo?=A!!e . the +essa-e 1as the sa+e= *a 2i - tra sactio s o the I ter et 1o)!" cost *a 2s a fractio of 1hat a physica! *ra ch 1o)!"'

&! Do2?<e-e.=e. SAo . Re")ce" "e!i/ery costs a " the a*se ce of physica! e<cha -e is i "icati/e of 1hy the I ter et he!" so +)ch pro+ise to t)r *a 2i - )psi"e "o1 ' I theory. physica! *ra ches 1ere ot re,)ire" a " the tra sactio costs o/er the I ter et 1ere +)ch !o1er' It 1as a!+ost o*/io)s that fro+ a *a 2Bs perspecti/e this 1as the 1ay to -o' Ho1e/er. the pro+ise of the I ter et 1as a "o)*!e=e"-e" s1or"'
24

Whi!e it he!" the opport) ity to !o1er costs a " "o a1ay 1ith cost!y *ra ches a " staff. it a!so pose" the threat of co+pressi - profit +ar-i s *y +a2i - it easier a " +ore efficie t for c)sto+ers to search a " -et co+parati/e i for+atio o the offeri -s of /ario)s pro/i"ers' A other threat that !oo+e" i the "ista ce 1as that this e1 e!ectro ic +ar2etp!ace for *a 2i - pro")cts 1o)!" "irect!y !i 2 the sa/ers i the eco o+y 1ith the *orro1ers a " )!ti+ate!y "i+i ish the ro!e of i ter+e"iaries !i2e *a 2s' #! Pe /e:1 In/o %-1ion O e of the thi -s that the I ter et "oes e<tre+e!y 1e!! is +a2e perfect i for+atio a/ai!a*!e to a!! +ar2et participa ts *y *ri -i - a*o)t efficie cies i the search process' For *)yers of *a 2i - ser/ices. there are sites that a--re-ate i for+atio o pro")ct offeri -s fro+ "iffere t pro/i"ers at a si -!e !ocatio ' $y +ere!y +a2i - i for+atio a/ai!a*!e to c)sto+ers a*o)t +)!tip!e pro/i"ers. these sites perfor+ the f) ctio of

"is+a t!i - the o!i-opo!y of a fe1 pro/i"ers a " *ri -i - a*o)t a str)ct)re te "i to1ar"s perfect co+petitio ' A -oo" e<a+p!e of this 1o)!" *e E=!oa . a o !i e

a--re-ator of !oa s' It a!!o1s pote tia! *orro1ers to search a " co+pare the offeri -s of tho)sa "s of pro/i"ers' O*/io)s!y. this is so+ethi - that a *orro1er ca ot efficie t!y acco+p!ish *y 1a!2i - aro) " *ra ches. researchi - pro")ct cata!o-)es or ca!!i -' E!i+i ati - the a-e tBs co++issio effects a f)rther re")ctio i +ort-a-e cost' As a f)rther /a!)e a""itio to the c!ie t Ea " to the o*/io)s "etri+e t of the *a 2Bs profita*i!ityF. E=!oa +o itors the +ort-a-e o/er its !ife a " co ti )a!!y a!erts the

*orro1er to cheaper refi a ce optio s' Perfect i for+atio 1o)!" *e a/ai!a*!e to the *a 2s as 1e!!' The I ter et +a2es it !ess !i2e!y that. for e<a+p!e. a i "i/i")a! co)!"
25

hi"e a *a" cre"it history fro+ prospecti/e pro/i"ers a " *eat the syste+ *y s1itchi pro/i"ers fre,)e t!y' To that e<te t this s)perior i for+atio =set 1o)!" e a*!e *a 2s to +o/e a1ay fro+ portfo!io=prici -. 1here -oo" cre"its s)*si"ise the *a" o es. to a prici - str)ct)re that is *ase" o the c)sto+erBs cre"it history' (! Re.2:e. o<e /o in1e %e.i- ies O e of the +ost s)ccessf)! co+pa ies o the I ter et is e$ay' It offers /isitors the a*i!ity to participate i o !i e a)ctio s ha12i - e/erythi - fro+ a )se" car to a perf)+e *ott!e co!!ectio ' More tha :4 +i!!io a)ctio s ha/e *ee co+p!ete" to e$ay o a a/era-e *asis set a e1 recor" of 7'835 +i!!io ' For the first ,)arter of 5444. e$ay -e erate" et re/e )es of U#D 39'3 +i!!io . a 744 U i crease o/er the ear!ier year' The !i2e!y reaso for e$ayBs s)ccess is that it offers /isitors a e!ectro ic +ar2etp!ace that is te "i - to1ar"s perfect co+petitio ' This is achie/e" *y t1o eco o+ic f) ctio s that e$ay is pro/i"i -' The first is a--re-atio of *)yers a " se!!ers a " faci!itati - a search f) ctio ' The seco " is *ri -i - a*o)t efficie cy i "eter+i i price that is e a*!e" *y the o !i e a)ctio +echa is+ 1hich +a2es prici - tra spare t a " a!so +a2es it "y a+ic si ce it is o1 "ri/e *y +ar2et co "itio s of S"e+a " a " s)pp!yB' A e$ay o !i e a)ctio +o"e! app!ie" to *a 2i - ser/ices co)!" ha/e a pote tia!!y "e/astati - effect o *a 2s' O the corporate *a2i - si"e. the I ter et co)!" rep!ace e<pe si/e tea+s of *a 2ers 1hose jo* is to !i 2 the co+pa ies i ee" of capita!

1ith the pro/i"ers of capita! Ea ". i the process s!ice=off *a 2i - feesF' $y creati co+petitio a+o - the pro/i"ers of capita!. the I ter et co)!" he!p co+pa ies raise

26

+o ey at +)ch fi er sprea"s' I /est+e t *a 2s )si - the I ter et s)ch as WR Ha+*recht ha/e pio eere" the )se of o !i e a)ctio s to "eter+i e prices for i itia! p)*!ic offeri -s EIPOsF' Ha+*rechtBs tra"e+ar2e" Ope IPO is *ase" o a D)tch a)ctio syste+ "esi- e" *y No*!e Pri?e 1i er eco o+ist Pic2rey a " a!!o1s i "i/i")a! a " i stit)tio a! i /estors to *i" o !i e for shares of a IPO' Participatio is ot *ase" o 1ho yo) 2 o1=,)a!ifie" i /estor ca ope a acco) t a " p!ace a *i"' The a)ctio treats a!! *i"s e,)a!!y. 1hether fro+ ,)a!ifie" i "i/i")a! i /estors or fro+ a !ar-e i stit)tio a! i /estor' The a!!ocatio is *ase" o 1hat the *i""er is 1i!!i - to pay rather tha o the prefere tia! treat+e t' This creates a +ar2et "ri/e *y s)pp!y a " "e+a " rather tha i f!)e ce or artificia! "e+a "'

T$E INDIAN SCENARIO

DRI6ERS OF C$AN+E A"/a ta-es pre/io)s!y he!" *y !ar-e fi a cia! i stit)tio s ha/e shr) 2 co si"era*!y' The I ter et has !e/e!e" the p!ayi - fie!" a " affor"e" ope access to c)sto+ers i the -!o*a! +ar2etp!ace' I ter et *a 2i - is a cost=effecti/e "e!i/ery cha e! for fi a cia! i stit)tio s' &o s)+ers are e+*raci - the +a y *e efits of I ter et *a 2i -' Access to o eNs acco) ts at a yti+e a " fro+ a y !ocatio /ia the Wor!" Wi"e We* is a co /e ie ce ) 2 o1 a short ti+e a-o' Th)s. a *a 2Ns I ter et prese ce tra sfor+s
27

fro+ N*ro)chre1areN stat)s to NI ter et *a 2i -N stat)s o ce the *a 2 -oes thro)-h a tech o!o-y i te-ratio effort to e a*!e the c)sto+er to access i for+atio a*o)t his or her specific acco) t re!atio ship' The si< pri+ary "ri/ers of I ter et *a 2i - i c!)"es. i or"er of pri+acy are@ VWI+pro/e c)sto+er access VWFaci!itate the offeri - of +ore ser/ices VWI crease c)sto+er !oya!ty VWAttract e1 c)sto+ers VWPro/i"e ser/ices offere" *y co+petitors VWRe")ce c)sto+er attritio

INDIAN BAN"S ON 4EB The *a 2i - i ")stry i I "ia is faci - ) prece"e te" co+petitio fro+ o =tra"itio a! *a 2i - i stit)tio s. 1hich o1 offer *a 2i - a " fi a cia! ser/ices o/er the I ter et' The "ere-)!atio of the *a 2i - i ")stry co)p!e" 1ith the e+er-e ce of e1 tech o!o-ies. are e a*!i - e1 co+petitors to e ter the fi a cia! ser/ices +ar2et ,)ic2!y a " efficie t!y' I "ia *a 2s are -oi - for the retai! *a 2i - i a *i- 1ay' Ho1e/er. +)ch is sti!! to *e achie/e"' This st)"y that 1as co ")cte" *y st)"e ts of IIML sho1s so+e i teresti - facts@ VWThro)-ho)t the co) try. the I ter et $a 2i - is i the asce t sta-e of "e/e!op+e t E+ore tha 94 *a 2s are offeri - /arie" 2i " of I ter et *a 2i - ser/icesF' VWI -e era!. these I ter et sites offer o !y the +ost *asic ser/ices' 99U are so ca!!e" Ne try !e/e!N sites. offeri - !itt!e +ore tha co+pa y i for+atio a " *asic +ar2eti - +ateria!s' O !y 3U

28

offer Na"/a ce" tra sactio sN s)ch as o !i e f) "s tra sfer. tra sactio s ; cash +a a-e+e t ser/ices' VWForei- ; Pri/ate *a 2s are +)ch a"/a ce" i ter+s of the )+*er of sites ; their !e/e! of "e/e!op+e t'

EMER+IN+ C$ALLEN+ES I for+atio tech o!o-y a a!yst fir+. the Meta Gro)p. rece t!y reporte" Kfi a cia! i stit)tio s 1ho "o Nt offer ho+e *a 2i - *y the year 5444 1i!! *eco+e +ar-i a!i?e"'K $y the year of 5445. a !ar-e sophisticate" a " hi-h!y co+petiti/e I ter et $a 2i Mar2et 1i!! "e/e!op 1hich 1i!! *e "ri/e *y V WDe+a " si"e press)re ")e to i creasi - access to !o1 cost e!ectro ic ser/ices' VW E+er-e ce of ope sta "ar"s for *a 2i - f) ctio a!ity' VW Gro1i - c)sto+er a1are ess a " ee" of tra spare cy' VW G!o*a! p!ayers i the fray VW &!ose i te-ratio of *a 2 ser/ices 1ith 1e* *ase" E=co++erce or e/e "isi ter+e"iatio of ser/ices thro)-h "irect e!ectro ic pay+e ts EE= &ashF' V WMore co /e ie t i ter atio a! tra sactio s ")e to the fact that the I ter et a!o - 1ith -e era! "ere-)!atio tre "s e!i+i ates -eo-raphic *o) "aries' VWMo/e fro+ o e stop shoppi - to N$a 2i - Portfo!ioN i'e' ) *) "!e" pro")ct p)rchases' &ertai !y so+e e<isti - *ric2 a " +ortar *a 2s 1i!! -o o)t of *)si ess' $)t thatNs *eca)se they fai! to respo " to the cha!!e -e of the I ter et' The I ter et a " its ) "er!yi - tech o!o-ies 1i!! cha -e a " tra sfor+ ot j)st *a 2i -. *)t a!so a!! aspects of fi a ce a " co++erce' It

represe ts +)ch +ore tha a e1 "istri*)tio opport) ity'

29

It 1i!! e a*!e i+*!e p!ayers to !e/era-e their *ric2 a " +ortar prese ce to i+pro/e c)sto+er satisfactio a " -ai share' It 1i!! force !ethar-ic p!ayers 1ho are str)c2 1ith !e-acy cost *asis. o)t of *)si ess=si ce they are ) a*!e to *ri - to p!ay i the e1 co te<t'

E-BAN"IN+ 4ORLD 4IDE #i ce its i ceptio . I ter et *a 2i - has e<perie ce" stro - a " s)stai e" -ro1th' Wor!" $a 2 report o !eapfro--i - i e=fi a ce poi te" o)t that the three co) tries 1ith

i+pressi/e pro-ress i i for+atio tech o!o-y i this se se are Esto ia. Rep)*!ic of %orea a " $ra?i!' &reatio of the 1or!"Bs !ea"i - e!ectro ic *a 2i - syste+s has *ee "o e at a re+ar2a*!y !o1 cost co+pare" to other 1or!"=c!ass i ter et *a 2s' I the E)ropea U io . :4 +i!!io peop!e. represe ti - 73 per ce t of the a")!t pop)!atio . )se o !i e *a 2i - I Fra ce. the )+*er of o !i e *a 2i - acco) ts is recor"i - a a )a! -ro1th rate of 89 per ce t' Ho1e/er. Esto ia is a co) try that has *eco+e a !ea"er i I ter et *a 2i E1hich o1 reaches 73 per ce t of the pop)!atio F. ot o !y a+o - Easter E)ropea co) tries *)t i 1or!" ra 2i -s. thro)-h a co+*i atio of easy to= )se soft1are. free=of=char-e

tra sactio s a " *eha/ior cha -es res)!ti - fro+ the i f!)e ce of the Nor"ic co) triesB IT c)!t)re o Esto ia' A sector i 1hich Lati A+erica is see+s to *e perfor+i - *etter tha i other i ")stries is o !i e retai! *a 2i -' Gro1th i this area has *ee "ri/e *y tra"itio a! *a 2s. 1hich ha/e )se" the o !i e cha e! to -e erate c)sto+er !oya!ty a " i+pro/e their operati - +ar-i s' T1o $ra?i!ia *a 2s. $ra"esco a " $a co "o $rasi!. ha/e th)s achie/e" +ore tha A +i!!io o !i e c)sto+ers each' Me<ico is a other !ea"er of I ter et *a 2i - i Lati A+erica' It a"opte" !e-is!atio pro/i"i - for the "e/e!op+e t of *oth E=&o++erce a " e=fi a ce' I Me<ico. the

30

)+*er of o !i e *a 2 )sers +ore tha trip!e" fro+ 844.444 i 5444 to 5'A +i!!io i 5447. a " it co)!" reach A'9 +i!!io i 5449 EE=Mar2eter5445*F' O e reaso for the s)ccess of Lati A+erica *a 2sB o !i e /e t)res see+s to *e the atte tio they ha/e pai" to pro/i"i - retai! c)sto+ers 1ith +)!tip!e 1ays to access their acco) ts EI ter et. te!epho e. 1ire!essF' Ho1e/er. -i/e that the share of the tota! pop)!atio that act)a!!y has a *a 2 acco) t is re!ati/e!y s+a!!. the e<pa sio of Lati A+erica o !i e *a 2i - +ay *e faci - a *ott!e ec2' &o+pare" 1ith o/era!! I ter et )sa-e esti+ate" at A'A +i!!io i A)stra!ia. the +ajor *a 2s to-ether ha/e attracte" o !y 7'5 +i!!io to o !i e *a 2i -' The I ter et is a -!o*a! phe o+e o a " so is e=fi a ce' Its "ep!oy+e t is ot !i+ite" to "e/e!ope" co) tries. a " i "ee" so+e "e/e!opi - co) tries L s)ch as I "ia a " the Rep)*!ic of %orea L are e<perie ci - partic)!ar!y stro - -ro1th i E=$a 2i -' I Asia o e of the +ost i+pressi/e recor"s has *ee achie/e" *y the Rep)*!ic of %orea' The Rep)*!ic of %orea is !ea"i - i o !i e *ro2era-e a " i +o*i!e *a 2i -' I #o)th=East Asia I ter et *a 2i - is a!so "e/e!opi - rapi"!y i Phi!ippi es' I $a -!a"esh there is a !ar-e -ap *et1ee the co+p)teri?atio of forei- *a 2s a " that of !oca! co++ercia! *a 2s a " as re-ar"s the state of their i tra= a " i ter=*ra ch o !i e et1or2s' Ho1e/er. 89 per ce t of !oca! *a 2s are p!a i - to i tro")ce E $a 2i -. 1hich i+p!ies /ery "y a+ic i+pro/e+e ts' Apart fro+ North a " #o)th Africa the #)* #ahara Africa is the re-io that is serio)s!y !a--i *ehi " i I ter et *a 2i -. a!tho)-h it is -i/i - to the rest of the 1or!" the -oo" e<a+p!e of +icrofi a ce "e/e!op+e ts Thai!a ". Ma!aysia. a " #i -apore a " to a !esser e<te t. i the

31

RE6IE4 OF LITERATURE
P o.2:1 -n. Te:;no<o=> = o20B ICICI B-n9. i its paper >&orporate *a 2i - )si tech o!o-y i tra sactio s( it 1as i ferre" that I for+atio Tech o!o-y has

re/o!)tio i?e" the ser/ices a " +o"e of ser/ices offere" *y the *a 2s to their corporate c!ie ts' The e+er-e ce of E=$a 2i - has e a*!e" the *a 2s to offer rea!=ti+e tra sactio s a " i te-rate a!! c)sto+ersB re!ate" f) ctio s' I "ia $a 2s are )ti!i?i - the e1 tech o!o-y to pro/i"e *etter tech o!o-y a " co /e ie t access to its c)sto+ers a " I "ia is th)s poise" to for a h)-e -ro1th i the 1or!" of e!ectro ic *a 2i -'

32

 C;-n.-n- RB Unni1;-nB P-2<- M!C!B SA-1%-n i

their research paper tit!e"

>E$a 2i - A"aptio s a " Dot'&o+ /ia*i!ity@ A co+pariso of A)stra!ia a " I "ia e<perie ces i the $a 2i - sector( a co+parati/e st)"y of A)stra!ia a " I "ia

e<perie ces i e$)si ess 1as "o e. 1hich see2s to i"e tify the effecti/e ess of "ot'co+s as i "icators of e$)si ess )pta2e a " s)ccess o a sector=*y=sector *asis 1as ) "erta2e ' It 1as co c!)"e" that the *a 2i - i ")stry is o1 a /ery +at)re o e a " *a 2s are *ei force" to cha -e rapi"!y as a res)!t of ope +ar2et forces s)ch as the threat of co+petitio . c)sto+er "e+a ". a " tech o!o-ica! i o/atio s s)ch as the -ro1th of the I ter et' E=$a 2i - is a s)ccessf)! strate-ic 1eapo for *a 2s to re+ai profita*!e i a /o!ati!e. a " co+petiti/e +ar2et p!ace of to"ay i *oth I "ia a " A)stra!ia Eco o+ies "espite the "iffere ces of IT )sa-e' +! "-nn-?i -n -n. P!C! N- ->-n "isc)ss i their artic!e the e<perie ces of a pri/ate= sector *a 2 i "ep!oyi - I ter et *a 2i - a " e&o++erce i I "ia' #trate-ic a!i- +e t of *)si ess a " IT strate-ies. p!a i - a " i+p!e+e tatio of e=*a 2i - i itiati/es. a " +a a-e+e t of *e efits ha/e *ee "e/e!op+e t' $2==ins poi ts to the fact that tra"itio a! *o) "aries i *a 2i - are "isappeari -' Usi e$)si ess +etho"s. +ajor retai!ers a " te!eco+ pro/i"ers are starti - to offer fi a cia! ser/ices to their c!ie ts' E<te "i - the /a!)e chai a " offeri - /ersati!e ser/ices see+s capt)re". a!o 1ith 2ey co tri*)tio s to

to *e the 2ey to retai i - co+petiti/e ess i the sector' Attit)"es are a!so shifti - fro+ "irect tra sactio s to sa/i -s a " i /est+e ts. as the *a*y *oo+ers reach their fortis a " fifties. a " prepare for retire+e t'

33

 M- io M- 1ineC +2e e oin his paper tit!e" >Profi!i - the a"optio of O !i e *a 2i #er/ices i the E)ropea U io ( offers a e+pirica! i /esti-atio o the a"optio of o !i e *a 2i - ser/ices a+o - E)ropea citi?e ' The )se of e*a 2i - ser/ices is

e<p!ai e" o the *asis of socio="e+o-raphic a " I ter et L specific *eha/iora! i "icators' The perfor+e" a a!yses pro/i"e s)pport for the i f!)e ce of co) try. a-e. professio a " se/era! I ter et *eha/iors o the )se of E=*a 2i -' T;e In.i-n In1e ne1 B-n9in= Jo2 ne> I 5447. a Reser/e $a 2 of I "ia s)r/ey

re/ea!e" that of A: +ajor *a 2s operati - i I "ia. aro) " 94U 1ere either offeri I ter et *a 2i - ser/ices at /ario)s !e/e!s or p!a e" to i the ear f)t)re' Accor"i - to a research report.E I "ia Research. %ota2 #ec)rities. May 5444'F 1hi!e i 5447. I "iaNs I ter et )ser *ase 1as a esti+ate" H !a2hR it 1as e<pecte" to reach H4 !a2h *y 5446' A!so. 1hi!e o !y 7U of these I ter et )sers )ti!i?e" the I ter et *a 2i - ser/ices i 7HH3. the I ter et *a 2i - )ser *ase i crease" to 7:'8U *y +i"= 5444' Jose0; e1 -<! (1DDD) i /esti-ate" the i f!)e ce of i ter et o the "e!i/ery of *a 2i ser/ices' They fo) " si< ) "er!yi - "i+e sio s of e=*a 2i - ser/ice ,)a!ity s)ch as co /e ie ce a " acc)racy. fee"*ac2 a " co+p!ai t +a a-e+e t. efficie cy. ,)e)e +a a-e+e t. accessi*i!ity a " c)sto+i?atio ' J2n -n. C-i (2001) i"e tifie" 78 ser/ice ,)a!ity "i+e sio s of i=*a 2i - ser/ice ,)a!ity' These are re!ia*i!ity. respo si/e ess. co+pete ce. co)rtesy. cre"i*i!ity. access. co++) icatio . ) "ersta "i - the c)sto+er. co!!a*oratio . co ti )o)s i+pro/e+e t. co te t. acc)racy. ease of )se. ti+e!i ess. aesthetics. sec)rity a " "i/ers feat)res' They a!so s)--este" that so+e "i+e sio s s)ch as respo si/e ess. re!ia*i!ity a " access are

34

 J->-A- .;en- (200#) tra sfor+s the ori-i a! #ERPQUAL sca!e to the i ter et co te<t a " "e/e!ops a *attery of 57 ite+s to assess ser/ice ,)a!ity i e*a 2i -' $y +ea s of a E<p!oratory Factor A a!ysis EEFAF a " a &o fir+atory Factor A a!ysis E&FAF. these 57 ite+s are co "e se" to fi/e ,)a!ity "i+e sio s@ access. 1e*site i terface. tr)st. atte tio a " cre"i*i!ity' Fro+ the pro/i"er perspecti/e. there are tar-et ,)a!ity a " "e!i/ere" ,)a!ity' The foc)s of process= or s)pp!y=!e" ,)a!ity "efi itio is rather i ter a! tha e<ter a!. a " it is "efi e" as co for+a ce to re,)ire+e ts' It !ays e+phasis o the i+porta ce of the +a a-e+e t a " the s)pp!y=si"e ,)a!ity. a " there is a i+porta t ro!e of the process i "eter+i i - the ,)a!ity of o)tco+e (+;o?-.i-nB 1DD#)! Achie/i - the ,)a!ity of co for+a ce *et1ee the p!a e" Etar-etF ,)a!ity !e/e! a " the rea! ,)a!ity "e!i/ere" to c)sto+ers "epe "s o or-a i?atio ' IAMAI e0o 1 on on<ine ?-n9in= 200)! A6U of o !i e *a 2i - )ser ha/e Bt starte" o !i e fi a cia! tra sactio *eca)se of sec)rity reaso s. 6HU ha/e Bt starte" *eca)se they prefer face to face. 55U ha/e Bt starte" *eca)se they "o Bt 2 o1 ho1 to )se. for 74U sites are ot )ser frie "!y a " for 5U *a 2s are ot pro/i"i - the faci!ity of i ter et *a 2i -' Accor"i - to research :3U of the c)sto+ers ca ot say that 1he they 1i!! *e the ser/ice ,)a!ity +a a-e+e t syste+ i a

starti - the fi a cia! tra sactio s thro)-h i ter et' Ma<i+)+ )+*ers of o !i e *a 2i )sers are +a!e a " +a<i+)+ of the+ are i a-e the -ro)p of 59=69' N)+*ers of fe+a!e )sers are /ery !ess i'e' 78U o !y' More tha :4U of the peop!e 1ho are ha/i - acco) t 1ith ha/e acco) ts i 6=A *a 2s' O !y 68U of I "ia I ter et )sers co+e fro+ Top 74 cities i'e' M)+*ai. $a -a!ore. De!hi. &a!c)tta. &he ai. P) e. Hy"era*a". Ah+e"a*a". #)rat a " Na-p)r! A other "ay a " a other )+*er' As per IAMAI a " I=c)*e. the

35

)+*er of acti/e I ter et )ser Ei'e' o es 1ho !o-o to I ter et at!east o ce a +o thF is o1 65 +i!!io a " )+*ers 1ho ha/e )se" I ter et at!east o ce sta "s at A: +i!!io ' T;e In.i-n In1e ne1 B-n9in= Jo2 ne> I 5447. a Reser/e $a 2 of I "ia s)r/ey

re/ea!e" that of A: +ajor *a 2s operati - i I "ia. aro) " 94U 1ere either offeri I ter et *a 2i - ser/ices at /ario)s !e/e!s or p!a e" to i the ear f)t)re' Accor"i - to a research report.E I "ia Research. %ota2 #ec)rities. May 5444'F 1hi!e i 5447. I "iaNs I ter et )ser *ase 1as a esti+ate" H !a2hR it 1as e<pecte" to reach H4 !a2h *y 5446' A!so. 1hi!e o !y 7U of these I ter et )sers )ti!i?e" the I ter et *a 2i - ser/ices i 7HH3. the I ter et *a 2i - )ser *ase i crease" to 7:'8U *y +i"= 5444' Me21e et al. (2000) ha/e i"e tifie" critica! i ci"e ts of c)sto+er satisfactio a "

"issatisfactio 1ith tech o!o-y=*ase" ser/ice e co) ters' Gi/e that *)si ess=to=*)si ess tra sactio s are the fastest -ro1i - se-+e t of tech o!o-y="ri/e ser/ices EHof. 7HHHFR Me)ter a " his co!!ea-)es E5444F s)--este" i /esti-ati - 1hat "ri/es *)si ess c)sto+er satisfactio or "issatisfactio 1ith tech o!o-y"ri/e ser/ices' Accor"i - to GX roos

E7H35F. c)sto+ers "isti -)ish the ,)a!ity of c)sto+er i teractio s that ta2e p!ace ")ri ser/ice "e!i/ery Ef) ctio a! ,)a!ityF a " the ,)a!ity of the o)tco+e the c)sto+er recei/es i the ser/ice e co) ter Etech ica! ,)a!ityF' &)sto+ers percei/e the ,)a!ity of ser/ices of I ter et *a 2i - *ase" o the perfor+a ce of o !i e "e!i/ery syste+s L ot o the processes i 1hich the "e!i/ere" ser/ice is "e/e!ope" a " pro")ce"' $eca)se c)sto+ers percei/e I ter et *a 2i - ser/ice ,)a!ity *ase" o re!ati/e!y sta "ar"i?e" o)tco+es

"eter+i e" *y o !i e syste+s. c)sto+er attit)"es to1ar" that o)tco+e ref!ect o/era!! ,)a!ity of ser/ices "e!i/ere" &)sto+ers )s)a!!y percei/e ris2s i co ")cti - tra sactio s e!ectro ica!!y a " partic)!ar!y if the tra sactio s i /o!/e +o ey' Ris2 perceptio ca *e

36

of si< "iffere t types@ ti+e ris2. fi acia! ris2. perfor+a ce ris2. psycho!o-ica! ris2 a " safetyIco fi"e tia!ity ris2' It is -e era!!y co si"ere" that ris2 perceptio co)!" *e hi-her for e!ectro ic *a 2i - ser/ices' This st)"y ai+s to ) "ersta " e<te t to 1hich 1hether this is co si"eratio is /a!i" as 1e!! as to "eter+i e the !e/e!s of ris2 perceptio

"iffere ces a+o - those )si - I ter et $a 2i - a " those ot )si - it'

OBJECTI6ES
7' To 2 o1 the a1are ess a+o - the c)sto+ers a*o)t E *a 2i -' 5' To 2 o1 a*o)t the satisfactio of the c)sto+ers )si - E *a 2i -' 6' To fi " o)t the factors that i f!)e ce the a"optio of E $a 2i - ser/ice'

37

A' To 2 o1 a*o)t the pro*!e+s e co) tere" i ser/icesEATM. Pho e *a 2i -. etcF'

*y the )sers 1hi!e )si - E=$a 2i -

RESEARC$ MET$ODOLO+Y
Rese- :; is "efi e" as h)+a acti/ity *ase" o i te!!ect)a! app!icatio i the i /esti-atio of +atter' The pri+ary p)rpose for app!ie" research is "isco/eri -. i terpreti -. a " the "e/e!op+e t of +etho"s a " syste+s for the a"/a ce+e t of h)+a 2 o1!e"-e o a 1i"e

38

/ariety of scie tific +atters of o)r 1or!" a " the ) i/erse' The ter+ research is a!so )se" to "escri*e a e tire co!!ectio of i for+atio a*o)t a partic)!ar s)*ject' Me1;o.o<o=> is the +etho" fo!!o1e" 1hi!e co ")cti - the st)"y o a partic)!ar project'

Thro)-h this +etho"o!o-y a syste+atic st)"y is co ")cte" o the *asis of 1hich the *asis of a report is pro")ce"' It is a 1ritte -a+e p!a for co ")cti - Research' Research +etho"o!o-y has +a y "i+e sio s' It i c!)"es ot o !y the research +etho"s *)t a!so co si"ers the !o-ic *ehi " the +etho"s )se" i the co te<t of the st)"y a " e<p!ai s 1hy o !y a partic)!ar +etho" or tech i,)e has *ee )se"' It a!so he!ps to ) "ersta " the ass)+ptio s ) "er!yi - /ario)s tech i,)es a " *y 1hich they ca "eci"e that certai tech i,)es 1i!! *e app!ica*!e to certai pro*!e+s a " other 1i!! ot' Therefore i or"er to so!/e a research pro*!e+. it is ecessary to "esi- a research +etho"o!o-y for the pro*!e+ as the so+e +ay "iffer fro+ pro*!e+ to pro*!e+'

T>0e o/ ese- :;
This st)"y is EYPLORATORG a " DE#&RIPTIPE i at)re' It he!ps i *rea2i - /a-)e

pro*!e+ i to s+a!!er a " precise pro*!e+ a " e+phasi?es o "isco/eri - of e1 i"eas a " i si-hts' E<p!oratory research 1as co ")cte" ")ri - the i itia! sta-e of the research process 1hich he!pe" to refi e the pro*!e+ i to researcha*!e o e' It has pro-ressi/e!y arro1e" the scope of research topic'

Rese- :; .esi=n
Research "esi- co stit)tes the *!)e pri t for the co!!ectio . +eas)re+e t a " a a!ysis of "ata' The prese t st)"y see2s to i"e tify the e<te t of prefere ces of E=$a 2i - o/er tra"itio a! *a 2i - a+o - ser/ice c!ass' The research "esi- is e<p!oratory i at)re' The research has *ee
39

co ")cte" o

ser/ice c!ass peop!e 1ithi

Go*i "-arh ' For the se!ectio

of the sa+p!e.

co /e ie t sa+p!i - +etho" 1as a"opte" a " a atte+pt has *ee +a"e to i c!)"e a!! the a-e -ro)ps a " -e "er 1ithi the ser/ice c!ass'

So2 :es o/ .-1Fo!!o1i - are the +etho"s of so)rces of "ata@ Se:on.- > .-1Q Artic!es o E=$a 2i - ta2e fro+ jo)r a!s. +a-a?i es p)*!ishe" fro+ ti+e to ti+e' Q Thro)-h i ter et' P i%- > .-1Q)estio aire 1as )se" to co!!ect pri+ary "ata fro+ respo "e ts' The ,)estio aire 1as

str)ct)re" type a " co tai e" ,)estio s re!ati - to "iffere t "i+e sio s of e*a 2i - prefere ces a+o - ser/ice c!ass s)ch as !e/e! of )sa-e. factors i f!)e ci - the )sa-e of e=*a 2i - ser/ices. *e efits accr)i - to the )sers of e=*a 2i - ser/ices. pro*!e+s e co) tere"' A atte+pt 1as a!so +a"e to e!icit reaso s for its o =)sa-e' The ,)estio s i c!)"e" i the ,)estio e "e". "ichoto+o)s a "offeri - +)!tip!e choices' S-%0<in= 1e:;niE2e The sa+p!i - tech i,)e )se" for j)"-+e t is CON6ENIENCE AND JUD+EMENT SAMPLIN+' S-%0<in= 2ni17 It "efi es the tar-et pop)!atio that 1i!! *e sa+p!e" i'e' it a s1ers 1ho is to *e s)r/eye"' I this st)"y. the sa+p!i - ) it is the peop!e of Go*i "-arh' S-%0<in= siCe7 It i "icates the )+*ers of peop!e to *e s)r/eye"' Tho)-h !ar-e sa+p!es -i/e +ore re!ia*!e res)!ts tha s+a!! sa+p!es *)t ")e to co strai t of ti+e a " +o ey. the sa+p!e si?e 1as restricte" to 744 respo "e ts' The respo "e ts *e!o - to "iffere t i co+e -ro)p a " professio ' aire 1ere ope =

40

Me1;o. o/ .-1- :o<<e:1ion7 The s)r/ey +etho" is )se" to co!!ect the "ata' Pario)s p!aces of Go*i "-arh /isite" for the p)rpose of co!!ectio of "ata' Rese- :; ins1 2%en17 The i str)+e t )se" for -atheri - "ata 1as ,)estio aire' To -et f)rther i si-ht i to the

research pro*!e+. i ter/ie1 re-ar"i - their *)yi - practices too 1as +a"e' This 1as "o e to crosschec2 the a)the ticity of the "ata pro/i"e"' To s)pp!e+e t the pri+ary "ata a " to faci!itate the process of "ra1i - i fere ce. seco "ary "ata 1as co!!ecte" fro+ p)*!ishe" so)rces !i2e +a-a?i es. jo)r a!s. e1spapers etc' Too<s -n. 1e:;niE2es o/ -n-<>sis7 The "ata so co!!ecte" 1i!! *e a a!y?e" thro)-h the app!icatio of statistica! tech i,)es. s)ch as a " pie charts'

VT-?<e 1

AA- eness o/ 0eo0<e e=- .in= e-?-n9in= se 3i:e 0 o3i.e. ?> 1;e ?-n9
F)!!y a1are Ha" a i"ea No i"ea No! o/ Res0on.en1s &' #) 1' Pe :en1-=e &'F #)F 1'F
41

Tota!

100

100

In1e 0 e1-1ion As see fro+ T-?<e 1. o/era!! perce ta-e of respo "e ts ha/i - co+p!ete 2 o1!e"-e a*o)t e= *a 2i - ser/ices pro/i"e" *y the *a 2 1hi!e ope i - a acco) t i it is 68U. those ha/i - so+e i"ea a*o)t it is A:U a " the perce ta-e of peop!e ha/i - o a1are ess of e=*a 2i - ser/ices pro/i"e" *y the *a 2 is 78U' It ca reaso a*!y *e co c!)"e" that ear!y 39U of the pop)!atio is ha/i - a1are ess a*o)t e=*a 2i - ser/ices'

V T-?<e 2!

So2 :es / o% A;i:; 1;e es0on.en1s =e1 1;e 9noA<e.=e -?o21 1;e e-?-n9in= se 3i:es
Pe son-< 6isi1 EGe:21i3e / o% B-n9 A.3e 1ise%en1s F ien.s -n. e<-1i3es No! o/ Res0on.en1s 1' 2& &# 2) Pe :en1-=e 1'F 2&F &#F 2)F
42

In1e 0 e1-1ion T-?<e 2. i "icates the perce ta-e "istri*)tio of a1are ess a/e )es. the +ajor are i fa/or of a"/ertise+e ts. 1hich score 6AU a+o - "iffere t a/e )es s)ch as perso a! /isit. e<ec)ti/es of the *a 2s. a"/ertise+e ts a " frie "Ire!ati/es' Whi!e the !east score is for perso a! /isit a " that of other so)rces

V T-?<e &!

AA- eness o/ E-B-n9in= se 3i:es

ATM De?i1 :- . C e.i1 :- . o1;e No! o/ Res0on.en1s #2 &2 21 ( Pe :en1-=e #2F &2F 21F (F

43

In1e 0 e1-1ion E=*a 2i - co stit)tes ser/ices pro/i"e" i ter+s of ATMs. De*it &ar". &re"it &ar". A " the other ser/ices s)ch as pho e *a 2i - i ter et *a 2i - ET&' A+o -st these ATM scores the !ar-est )se" ser/ice stat)s EA5UF as i "icate" *y ta*!e 6 fi-)res' &!ose o the hee!s is De*it car" E65UF. &re"it car" E57UF. 1hi!e other ser/ices s)ch as pho e *a 2i - !a-s *ehi " *y scori - the !east ie'.9U'

V T-?<e #

Use s o/ E-?-n9in= se 3i:es

Use s Non Use s To1-< No! o/ Res0on.en1s )0 #0 100 Pe :en1-=e )0F #0F 100F

44

In1e 0 e1-1ion T-?<e # sho1s that a+o - those a1are a*o)t :4 perso s )se e=*a 2i - ser/ices. 1hich is :4U of tota! pop)!atio st)"ie"'

VT-?<e (!

F eE2en:> o/ 2s-=e o/ .i//e en1 e-?-n9in= se 3i:es

On:e - .-> On:e - Aee9 On:e - %on1; in/ eE2en1<> No o/ es0on.en1s 10 &0 &( 2( Pe :en1-=es 10F &0F &(F 2(F

45

In1e 0 e1-1ion The respo "e ts 1ho )se the e *a 2i - ser/ices o ce i a "ay are 74U a " 1ho )se the e *a 2i - ser/ices o ce i a 1ee2 are 64U a " the peop!e 1ho )se the e *a 2i - ser/ices o ce i the +o th are 69U' There are peop!e 1ho )se the e *a 2i - ser/ices i fre,)e t!y are 59U as sho1 i the chart'

V T-?<e )!

F-:1o s in/<2en:in= 1;e <e3e< o/ 2s-=e

A<< 1i%e -3-i<-?i<i1> E-se o/ 2se Se:2 i1> Di e:1ness No o/ es0on.en1s 2D 2) &0 1( Pe :en1-=e 2DF 2)F &0F 1(F

46

In1e 0 e1-1ion A st)"y of the factors. ta*!e :. i f!)e ci - the )sa-e 1as +a"e *y !isti - o)t /ario)s factors s)ch as a!! ti+e a/ai!a*i!ity. ease of )se. ear ess etc'. a " fro+ 1hich it ca+e to fore that a+o -st the /ario)s factors a!! ti+e a/ai!a*i!ity is ra 2e" as the +ajor +oti/ati - factor. fo!!o1e" *y ease of )se. "irect access. ear ess. sec)rity i "ecreasi - or"er of i+porta ce' Q)ite i teresti -!y frie "s a " re!ati/es. stat)s sy+*o! score" the !east +oti/ati - factor'

V T-?<e '

6- io2s ?ene/i1s -:: 2in= / o% E-B-n9in= se 3i:es 1o i1s 2se s

Ti%e s-3in= IneG0ensi3e E-s> 0 o:essin= O1;e No o/ es0on.en1s #2 2' 2& 8 Pe :en1-=e #2F 2'F 2&F 8F

47

In1e 0 e1-1ion Whe as2e" to !ist /ario)s *e efits accr)i - fro+ the )sa-e of e=*a 2i -. ti+e sa/i - recei/e" hi-hest perce ta-e score at A5U a+o - "iffere t *e efits s)ch as i e<pe si/e E58UF. easy processi - E56UF. a " so+e other reaso s s)ch as easy f) " tra sfer E3UF' Q)ite i teresti -!y. easy processi - feat)re score" +ore tha the i e<pe si/e ess of the e=*a 2i - ser/ices' The other *e efits accr)i - to the peop!e i c!)"e rea"y a/ai!a*i!ity of f) "s. re+o/a! of +i""!e+e a " o r)"e c)sto+er re!atio e<ec)ti/es' V T-?<e 8

P o?<e%s i.en1i/ie. ?> 1;e 2se s o/ E-B-n9in= se 3i:e

Ti+e co s)+i ATM o)t of or"er A+o) t "e*ite" *)t ot 1ith"ra1 Pass1or" for-otte No of respo "e ts 54 6H 67 74 Perce ta-e 54U 6HU 67U 74U

48

In1e 0 e1-1ion Most of the )sers face the pro*!e+ of ATM o)t of or"er E56UF. fo!!o1e" *y ti+e co s)+i E6HUF. a+o) t "e*ite" *)t ot 1ith"ra1 E58UF pass1or" for-otte E77UF a " the other pro*!e+s as car" +isp!ace". car" +is)se. i sec)rity. etc

V T-?<e D

Re-sons /o no1 2sin= E-B-n9in= se 3i:es -s -1e. ?> 1;e non 2se s
S-1is/ie. Ai1; 1 -.i1ion-< %e1;o. No -::ess 1o ne1 L-:9 o/ o0e -1ion-< 9noA<e.=e O1;e No o/ es0on.en1s (8 22 1( ( Pe :en1-=e (8F 22F 1(F (F

49

In1e 0 e1-1ion Fro+ the o )sers. a atte+pt 1as +a"e to e!icit the reaso s for its o )sa-e' As i "icate" *y ta*!e satisfactio 1ith tra"itio a! *a 2i - 1as co si"ere" as pri+e "e+oti/ati - factor. fo!!o1e" c!ose!y *y the o access to et a " !ac2 of operatio a! 2 o1!e"-eB factor. 1hich s)--este" their resista ce to cha -e. 1hich to so+e e<te t ca *e co) tere" *y a--ressi/e a"/ertise+e t a " )ti!i?i - other +o"es of a1are ess "isse+i atio as 1e!!'

FINDIN+S
7' More of the respo "e ts 2 o1 a*o)t the E *a 2i - ser/ices as 68U are f)!!y a1are a*o)t the ser/ices a " A:U ha" a i"ea a*o)t the E *a 2i - ser/ices' 5' The so)rce of the i for+atio a*o)t E *a 2i - i c!)"e" s)ch as a"/ertise+e t E6AUF. frie "s E5:UF a " e<ec)ti/e of the *a 2 E56UF' 6' E *a 2i - ser/ices are +ost!y )se" o ce i a +o th E69UF this i "icates that E *a 2i ser/ices are ot fre,)e t!y )se"' A' Factors s)ch as sec)rity E64UF. a!! ti+e a/ai!a*i!ity E5HUF ease of )se E5:UF i f!)e ce the )se of E *a 2i - ser/ices'
50

9' The pro*!e+s 1hich are face" *y the respo "e ts +ai !y they fi " it ti+e co s)+i E6HUF a " so+e other s)ch as a+o) t "e*ite" *)t ot 1ith"ra1 . pass1or" for-otte etc' :' The respo "e ts 1ho "o ot )se the E *a 2i - ser/ices -a/e the reaso s s)ch as they are satisfie" 1ith the tra"itio a! *a 2i - syste+ E93UF. !ac2 of operatio a! 2 o1!e"-e etc'

LIMITATIONS
7' The st)"y is !i+ite" to areas of +a "i-o*i "-arh o !y'

5' The st)"y is !i+ite" to 744 respo "e ts o !y' 6' No =a/ai!a*i!ity of so+e i for+atio a " "ata re,)ire" for the st)"y of the ser/ices A' The st)"y 1as co ")cte" 1ith the *asic ass)+ptio that the i for+atio -i/e *y the respo "e t is fact)a! a " represe ts their tr)e fe!!i - a " *eha/ior 9' The st)"y 1as ti+e *o) "'

51

SU++ESTIONS
7' The "e!i/ery process of each the E *a 2i - ser/ices offere" *y "iffere t *a 2s sho)!" *e +ore c)sto+er Lorie te" 'so that i e tire process of ser/ices "e!i/ery a " c)sto+er i teractio process ti+e is +i i+i?e"' 5' $a 2s sho)!" ho!" "e+o stratio a " pro/i"e trai i - to c)sto+ers to e<p!ai a*o)t its )sa-e. effecti/e ess etc' 6' To pro+ote E *a 2i - o !i e "e+o +)st *e pro/i"e" o a!! *a 2s 1e*sites this sho)!" *e i for+ati/e. e")cati/e a " attracti/e'

52

A' $a 2s sho)!" pro/i"e *etter sec)rity a"opti - *etter sec)rity +eas)res a " e")cate c)sto+er that there is o sec)rity ris2 i /o!/e" i this' 9' To pro+ote E *a 2i - o !i e "e+o +)st *e pro/i"e" o a!! *a 2s 1e*sites this sho)!" *e i for+ati/e. e")cati/e a " attracti/e'

BIBLIO+RAP$Y
BOO"S Ma!hotra. T' D'. > E!ectro ic $a 2i - a " I for+atio Tech o!o-y i $a 2s( #)!ta &ha " a " #o s. Ne1 De!hi.5443' #'# %apta ; N'#' &ho)*ey' >I "ia $a 2i - i E!ectro ic Era( I ' I ter et $a 2i -=The #eco " Wa/e@ $y #a jee/ #i -ha!.Tata Mc-ra1 P)*!icatio . 5446 Hi!!

53

Ma a-e+e t Tre "s EA 0o)r a! of Depart+e t of $)si ess Ma a-e+e tF Artic!e= I ter et $a 2i - *y %a/ita %shatriya #ep 544A I "ia $a 2i - 5449 . The I&FAI U i/ersity Press P)*!icatio The 0o)r a! of I ter et $a 2i - a " &o++erce E P)*!ishe" *y Array De/e!op+e t of Otta1aF

I ter atio a! 0o)r a! of $)si ess Perfor+a ce Ma a-e+e t 5445 EP)*!ishe" *y I "er#cie ce p)*!ishersF

4EBSITES

111'*a 2 eti "ia'co+ 111'firsti*'co+ 111' atio a!city'co+ 111' et*a 2er'co+ 111'*harat*oo2'co+

@UESTIONAIRE
De- Res0on.en1B We 1i!! appreciate yo)r cooperatio i this re-ar" *y fi!!i - )p the ,)estio aire caref)!!y' A!! the i for+atio pro/i"e" *y yo) 1i!! *e 2ept co fi"e tia!'

54

7' I 1hich *a 2s "o yo) ha/e yo)r acco) tZ a' #tate $a 2 of I "ia c' P) ja* Natio a! $a 2 *' HDF& $a 2 "' A y other. P!ease #pecify i' ===================== ii' ===================== iii' =====================

5' Whi!e ope i - )p the acco) t. 1ere yo) a1are of E=*a 2i - ser/ices pro/i"e" *y yo)r *a 2Z a' F)!!y a1are c' No 6! I/ -nsAe 1o E2es1ion no!2 is :B ho1 "i" yo) -et to 2 o1 a*o)t E=*a 2i - ser/ices of yo)r *a 2Z a' Perso a! /isit c' A"/ertise+e ts *' E<ec)ti/e fro+ the *a 2 "' Frie "sI Re!ati/es *' Ha" a i"ea

A! I/ -nsAe 1o E2es1ion no!2 is - o ?B 1hich of the fo!!o1i - E=*a 2i - ser/ices are yo) a1are ofZ a' ATM c' &re"it &ar" *' De*it &ar" "' if a y other p!ease specifyCCC

9' Do yo) )se E=*a 2i - ser/icesZ a' Ges EI/ NoB -nsAe E2es1ion no! 10 .i e:1<>F' *' No

:' If a s1er to ,)estio

o'9 is yes. ho1 fre,)e t!y "o yo) )se each of the fo!!o1i - ser/icesZ 55

a' O ce i a "ay c' O ce i a +o th

*' O ce i a 1ee2 "' I fre,)e t!y

8' Which of the fo!!o1i - factors i f!)e ce yo) the +ost to )se E=*a 2i - ser/icesZ a A!! ti+e a/ai!a*i!ity c' #ec)rity * Ease of )se "' Direct access

3' Which of the fo!!o1i - *e efits accr)e to yo). 1hi!e )si - E=*a 2i - ser/icesZ a' Ti+e sa/i c' Easy processi *' I e<pe si/e e' A y other. p!ease specify[[[[[[

H' 1hat are the pro*!e+s i"e tifie" 1hi!e )si - E=*a 2i - ser/icesZ a' I sec)rity c' A+o) t "e*ite" *)t ot 1ith"ra1 *' ATM o)t of or"er "' Pass1or" for-otte

74' %i "!y e !ist the reaso s for ot )si - the E=*a 2i - ser/icesZ a' No ee"E #atisfie" 1ith tra"itio a! *a 2i -F c' Lac2 of operatio a! 2 o1!e"-e "' A y other. p!ease specify[[[[[[ *' No access to i ter et

77' To 1hat e<te t are yo) satisfie" 1ith yo)r $a 2sB E=*a 2i - ser/icesZ a' Hi-h!y #atisfie" c' Ne)tra! *' #atisfie" "' Dissatisfie"

75' What other ser/ices yo) 1o)!" !i2e to ha/e thro)-h E=*a 2i -Z [[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[ 56

[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[[

Res0on.en1Hs P o/i<e Na+e @ [[[[[[[[[[[[[[[[ In:o%e <e3e< 0e %on1; Less tha Rs' 74.444 Rs'74.444 to Rs'54.444 Rs'54.444 to Rs'64.444 More tha Rs'64.444 A-e @ [[[[[[[[[[[[[[[ Ge "er EMIFF @ [[[[[[[[[[[[[[[[ Professio @ [[[[[[[[[[[[[[[[ Or-a i?atio @ [[[[[[[[[[[[[[[[

57