A Comprehensive Project Report

On
The Study on Demographic factor influencing the satisfaction level
of Internet-banking among customers.

SUBMITTED TO:

SAL INSTITUTE OF MANAGEMENT

AFFILIATED TO GUJARAT TECHNOLOGICAL UNIVERSITY

AHMEDABAD.

UNDER THE GUIDANCE

OF

ASST PROF. DR.FARHANA QURESHI.

Mehul Chauhan - Enrolment No.- 198070592053

Kaushlesh Kumar Choudhary - Enrolment No.- 19807059255

 CHAPTER – 1
INTRODUCTION
 INTRODUCTION OF THE TOPIC

Online banking, also known as internet banking or web banking, is an electronic payment
system that enables customers of a bank or other financial institution to conduct a range of
financial transactions through the financial institution's website. The online banking system will
typically connect to or be part of the core banking system operated by a bank and is in contrast to
branch banking which was the traditional way customers accessed banking services.

Some banks operate as a "direct bank" (or "virtual bank"), where they rely completely on internet
banking.

Internet banking software provides personal and corporate banking services offering features
such as viewing account balances, obtaining statements, checking recent transactions,
transferring money between accounts, and making payments.

Special Features of Internet Banking

Here are some of the best features of internet banking:

 Provides access to financial as well as non-financial banking services

 Facility to 1check bank balance any time
 Make bill payments and fund transfer to other accounts
 Keep a check on mortgages, loans, savings a/c linked to the bank account
 Safe and secure mode of banking
 Protected with unique ID and password
 Customers can apply for the issuance of a checkbook
  Buy general insurance
 Set-up or cancel automatic recurring payments and standing orders
 Keep a check on investments linked to the bank account
 Services Available through the Internet Banking
 Once a customer is registered for online banking, he/she can log-in to the respective
online banking portal of his/her bank using the issued User-ID and password.

Advantages of Internet Banking

Given below are some advantages/benefits of Internet Banking available for all the users

 24×7 Availability: Internet banking, unlike usual banking hours, is not time-bound. It is
available 24×7 throughout the year. Most of the services available online are not time-
restricted. Users can check their bank balance, account statements and make fund
transfers anytime instantly.
 The convenience of initiating financial transactions: Internet banking is largely
preferred because of the convenience that it provides while fund transfer and bill
payments. Registered users can use almost all the banking services without having to visit
the bank and standing in queues. Financial transactions such as paying bills and
transferring funds between accounts can easily be performed anytime as per the
convenience of the user.
 Proper Track of Transactions: Acknowledgement slips are provided by the bank after
transactions that have a high possibility of getting misplaced. However, with internet
banking, it becomes very easy to track the history of all the transactions initiated by the
user. Transactions and fund transfers made online are organized in the 'Transaction
History' section along with other details such as the payee's name, bank account number,
the amount paid, the date and time of payment, and remarks.
 Quick and Secure: Net banking users can transfer funds between accounts instantly,
especially if the two accounts are held at the same bank. Funds can be transferred via
NEFT, RTGS, or IMPS as per the user's convenience. One can also make bill payments,
EMI payments, loans, and tax payments easily. Moreover, the transactions, as well as the
account, are secured with a password and unique User-ID.
 Non-financial Transactions: Besides fund transfer, internet banking allows the users to
avail non-financial services such as balance check, account statement check, application
for issuance of the checkbook, etc.

Types of Fund Transfers using Internet Banking

As we have already discussed, there are three types of fund transfers that can be made using net-
banking. Let us understand more.
NEFT
National Electronic Fund Transfer (NEFT) is a payment system that allows one-to-one fund
transfer.

 Using NEFT, individuals and corporates can transfer funds electronically from any bank
branch to any individual or corporate with an account with any other bank branch in the
country
 NEFT service is available 24×7 on internet banking. But it is a time-restricted service at
the bank branch
 Usually, NEFT transfer is completed within 30 minutes. Nonetheless, the time can even
stretch to 2-3 hours or might be completed in just 10 minutes

RTGS
 Real-Time Gross Settlement (RTGS) is a continuous settlement of funds individually on
an order by order basis.
 This payment system ensures that the receiver's account gets credited with the funds
almost immediately and not after a certain duration, as is the case with other payment
modes like NEFT
 RTGS transactions are tracked by the RBI, thereby successful transfers are irreversible.
This method is majorly used for large value transfers
 The minimum amount to be remitted through RTGS is 2 lakhs. There is no cap on the
maximum amount for transfer via RTGS
 Like NEFT, RTGS is also available online 24×7

IMPS
 Immediate Payment System (IMPS) is another payment method that transfers funds in
real-time.
 IMPS is used to transfer funds instantly within banks across India via mobile, internet,
and ATM, which is not only safe but also economical both in financial and non-financial
perspectives
 IMPS is an inexpensive mode of fund transfer. Other fund transfer mediums such as
NEFT and RTGS charge significantly higher than IMPS
 It does not require details like account number, IFSC code, etc. Funds can be transferred
via IMPS just with the mobile number of the beneficiar
 HISTORY EVALUATION

Precursors
The precursor to the modern home banking services were the distance banking services over electronic
media from the early 1980s. The term 'online' became popular in the late 1980s and referred to the use of
a terminal, keyboard, and TV (or monitor) to access the banking system using a phone line. 'Home
banking' can also refer to the use of a numeric keypad to send tones down a phone line with instructions
to the bank.

The emergence of computer banking

The first known deployment of home computer banking to consumers came in December 1980 at
United American Bank, a community bank headquartered in Knoxville, Tenn. United American
partnered with Radio Shack to produce a secure custom modem for its TRS-80 computer that
would allow bank customers to access account information securely. Services available in its
first year included bill pay, account balance checks, and loan applications, as well as game
access, budget and tax calculators, and daily newspapers. Thousands of customers paid $25–30
per month for the service. Large banks, many working on parallel tracks to United American,
followed in 1981 when four of New York's major banks (Citibank, Chase Manhattan, Chemical,
and Manufacturers Hanover) offered home banking services, using the video tax system.
Because of the commercial failure of video tax, these banking services never became popular
except in France (where the use of video tax (Mintel) was subsidized by the telecom provider)
and the UK, where the Prestel system was used.

The developers of United American Bank's first-to-market computer banking system aimed to
license it nationally, but they were overtaken by competitors when United American failed in
1983 as a result of loan fraud on the part of bank owner Jake Butcher, the 1978 Tennessee
Democratic nominee for governor and promoter of the 1982 Knoxville World's Fair. First
Tennessee Bank, which purchased the failed bank, did not attempt to develop or commercialize
the computer banking platform.

Internet and customer reluctance and banking

When the clicks-and-bricks euphoria hit in the late 1990s, many banks began to view web-based
banking as a strategic imperative. In 1996

A mergers-and-acquisitions wave swept the financial industries in the mid-and late 1990s,
greatly expanding bank's customer bases. Following this, banks looked to the Web as a way of
maintaining their customers and building loyalty. Some different factors are causing bankers to
shift more of their business to the virtual realm.

While financial institutions took steps to implement e-banking services in the mid-1990s, many
consumers were hesitant to conduct monetary transactions over the internet. It took widespread
adoption of electronic commerce, based on trailblazing companies such as America Online,
Amazon.com, and eBay, to make the idea of paying for items online widespread.

By 2000, 80% of U.S. banks offered e-banking. Customer use grew slowly. At Bank of America,
for example, it took 10 years to acquire 2 million e-banking customers. However, a significant
cultural change took place after the Y2K scare ended.

In 2001, Bank of America became the first bank to top 3 million online banking customers, more
than 20% of its customer base. In comparison, larger national institutions, such as Citigroup
claimed 2.2 million online relationships globally, while J.P. Morgan Chase estimated it had more
than 750,000 online banking customers. Wells Fargo had 2.5 million online banking customers,
including small businesses. Online customers proved more loyal and profitable than regular
customers. In October 2001, Bank of America customers executed a record 3.1 million electronic
bill payments, totaling more than $1 billion. As of 2017, the bank has 34 million active digital
accounts, both online and mobile. In 2009, a report by Gartner Group estimated that 47% of
United States adults and 30% in the United Kingdom bank online.

The early 2000s saw the rise of branch-less banks as internet-only institutions. These internet-
based banks incur lower overhead costs than their brick-and-mortar counterparts. In the United
States, deposits at most direct banks are FDIC-insured and offer the same level of insurance
protection as traditional banks.

First online banking services by region

The United Kingdom
Online banking started in the United Kingdom with the launch of Nottingham Building Society
(NBS)'s Home Link service in September 1982, initially on a restricted basis, before it was
expanded nationally in 1983. Home Link was delivered through a partnership with the Bank of
Scotland and British Telecom's Prestel service. The system used a Prestel view link system and a
computer, such as the BBC Micro, or keyboard (Tan data Td1400) connected to the telephone
system and television set. The system allowed users to "transfer money between accounts, pay
bills and arrange loans... compare prices and order goods from a few major retailers, check local
restaurant menus or real estate listings, arrange vacations... enter bids in Home Link's regular
auctions and send electronic mail to other Home Link users." To make bank transfers and bill
payments, a written instruction giving details of the intended recipient had to be sent to the NBS
who set the details up on the Home Link system. Typical recipients were gas, electricity, and
telephone companies and accounts with other banks. Details of payments to be made were input
into the NBS system by the account holder via Prestel. A cheque was then sent by NBS to the
payee and advice-giving details of the payment were sent to the account holder. BACS was later
used to transfer the payment directly.

The United States

In the United States, in-home banking was "is still in its infancy" with banks "cautiously testing
consumer interest" in 1984, a year after online banking went national in the UK. At the time
Chemical Bank in New York was "still working out the bugs from its service, which offers
somewhat limited features". The service from Chemical, called Pronto, was launched in 1983
and was aimed at individuals and small businesses. It enabled them to maintain electronic
checkbook registers, see account balances, and transfer funds between checking and savings
accounts. The other three major banks — Citibank, Chase Bank, and Manufacturers Hanover —
started to offer home banking services soon after. Chemical's Pronto failed to attract enough
customers to break even and was abandoned in 1989. Other banks had a similar experience.

Since it first appeared in the United States, online banking has been federally governed by the
Electronic Funds Transfer Act of 1978.

France
After a test period with 2,500 users starting in 1984, online banking services were launched in
1988,using Mintel terminals that were distributed freely to the population by the government.

By 1990, 6.5 million Mintel’s were installed in households. Online banking was one of the most
popular services.

Online banking services later migrated to the Internet.

Japan
In January 1997, the first online banking service was launched by Sumitomo Bank. By 2010,
most major banks implemented online banking services, however, the types of services offered
varied. According to a poll conducted by the Japanese Bankers Association (JBA) in 2012,
65.2% were users of personal internet banking.

China
In January 2015, we Bank, the online bank created by Ten cents, started a 4-month-long online
banking trial operation.

Australia
In December 1995, Advance Bank acquired by St. George Bank, started to provide customers
with online banking with the rollout of the C++ Internet banking program.

India
In 1998, ICICI Bank introduced internet banking to its customers.

Brazil
In 1996, Banco Original SA launched its online-only retail banking. In 2019 new banks began to
emerge as the Conte Simples, focused only on companies.

Canada
Virtual banking first became a possibility in 1996 with the Bank of Montreal's many. Manx was
released at the very beginning of the internet banking revolution in Canada and was the first full-
service online bank Also in 1996, RBC started providing banking information online and had
the first personal computer banking software released that year In 1997, the bank ING Direct
Canada (now known as Tangerine Bank) was founded with almost entirely online banking using
only small cafes for meetings and very few physical branches. This was completely different
from how banks had operated in Canada previously. By the early 2000s, all of the major banks in
Canada rolled out some form of online banking.

Banks and the World Wide Web

Around 1994, banks saw the rising popularity of the internet as an opportunity to advertise their
services. Initially, they used the internet as another brochure, without interaction with the
customer. Early sites featured pictures of the bank's officers or buildings and provided customers
with maps of branches and ATM locations, phone numbers to call for further information, and
simple listings of products.

Interactive banking on the Web

In 1995, Wells Fargo was the first U.S. bank to add account services to its website, with other
banks quickly following suit. That same year, Presidential became the first U.S. bank to open
bank accounts over the internet. According to research by Online Banking Report, at the end of
1999 less than 0.4% of households in the U.S. were using online banking. At the beginning of
2004, some 33 million U.S. households (31%) were using some form of online banking. Five
years later, 47% of Americans used online banking, according to a survey by Gartner Group.
Meanwhile, in the UK online banking grew from 63% to 70% of internet users between 2011
and 2012. By 2018, the number of digital banking users in the U.S. reached approximately 61
percent. The penetration of online banking in Europe has been increased as well. In 2019, a date
shows that 93 percent of the Norwegian population access online banking sites, which is the
highest in Europe, followed by Denmark and the Netherlands. Across Asia, more than 700
million consumers are estimated to use digital banking regularly, according to a 2015 survey by
McKinsey and Company.

CURRENT PERSPECTIVE
Internet Banking has become an integral part of the banking system in India. The concept of e-
banking is of fairly recent origin in India. Till the early 90 ‟ s traditional model of banking i.e.
branch-based banking was prevalent, but after that non-branch banking services were started.
The credit of launching internet banking in India goes to ICICI Bank. Citibank and HDFC Bank
followed with internet banking services in 1999. The Government of India enacted the IT Act,
2000 with effect from October 17, 2000, which provided legal recognition to electronic
transactions and other means of electronic commerce. The Reserve Bank is monitoring and
reviewing the legal and other requirements of e-banking continuously to ensure that e-banking
would develop on sound lines and e-banking related challenges would not pose a threat to
financial stability. According to the report of RBI in Jan 2016, there are 196079 ATMs and
1337310 points of sale devices in India.

Tables no 1, 2, and 3 exhibits a few facts and figures related to internet/electronic banking to present its
current scenario. Table 1 shows evidence for ATM, POS (Point of sale) and electronic cards (credit and
debit cards) deployed and issued by the scheduled commercial banks (SCBs) in India as of December
2014. It also provides evidence of growing statistics of mobile banking users in India. According to it
currently, 1,76,410 ATMs, 10,58,642 Point of sale devices, 20.36 million credit cards, and 500 million
debit cards are working in India and 35.5 million bank customers are using mobile banking. The table
also shows the growth rate of these banking channels and it seems to be great in the Indian context. Table
no. 2 shows current transaction statistics performed through these banking delivery channels. As high as
6090.98 million transactions are electronically done through ATMs. Table no 3 shows NEFT and RTGS
transactions performed in the current financial year 2014-15.
 Table 1 Various Internet/Electronic Banking Delivery Channels

No of channels
Growth in
Type of internet channels Years
%
2010* 2020*

No of ATM deployed (in actual figure) 60,153 2,21,703 27.13

No of POS deployed (in actual figur) 5,95,958 51,30,000 1162%

No of CREDIT CARDS issued (in Millions) 18.33 57.40 31.93

No of DEBIT CARDS issued (in Millions) 181.97 829.4 21.95

No of MOBILE BANKING Users (in Millions) 5.96 69.3 860%

Table 2 Transactions through Internet/Electronic Banking Delivery Channels

No of channels

Transaction Trough Years Growth in %

2011-12 2020-21

ATM 5,086.17 1,017,234 50.00

POS 645.76 728494 90%

CREDIT CARDS 320.42 154051 21.00

DEBIT CARDS 5409.45 26281181 226.00

MOBILE BANKING 25.55 2417.3 105%

 Table 3 NEFT and RTGS Transactions

No of channels

Transaction Type Years Growth in %

2011-12 2020-21

NEFT 132.00 7312 55.40

RTGS 49.00 2170 44.30

PORTER'S FIVE FORCE (INDUSTRY)

Contents

1. The threat of New Entrants:

2. Power of Suppliers:
3. Power of Buyers:
4. Availability of Substitutes:
5. Competitive Rivalry:
The threat of New Entrants:

Despite the regulatory and capital requirements of starting a new bank, between 1977 and 2002
an average of 215 new banks opened each year according to the FDIC. With so many new banks
entering the market each year the threat of new entrants should be extremely high. However, due
to mergers and bank failures, the average number of total banks decreases by roughly 253 a year.
A core reason for this is, what is arguable,

The Biggest barrier of entry for the banking industry trust Because the industry deals with other
people's money and financial information new banks find it difficult to start up. Due to the nature
of the industry people are more willing to place their trust in big-name, well-known, major banks
that they consider to be trustworthy.

The banking industry has undergone a consolidation in which major banks seek to serve all of a
customer's financial needs under their roof (this can be seen in the business model of banks like
Wells Fargo's). This consolidation furthers the role of trust as a barrier to entry for new banks
looking to compete with major banks, as a consumer are more likely to allow one bank to hold
all their accounts and service their financial needs.

Ultimately the barriers to entry are relatively low for the banking industry. While it is nearly
impossible for new banks to enter the industry offering the trust and full range of services as a
major bank, it is fairly easy to open up a smaller bank operating on the regional level.

Power of Suppliers:

Capital is the primary resource on any bank and there are four major suppliers (various other
suppliers [like fees] contribute to a lesser degree) of capital in the industry.

1. Customer deposits. 2. mortgages and loans. 3. mortgage-baked securities. 4. loans from other
financial institutions.

By utilizing these four major suppliers, the bank can be sure that they have the necessary
resources required to service their customers' borrowing needs while maintaining enough capital
to meet withdrawal expectations.

The power of the suppliers is largely based on the market, their power is often considered to
fluctuate between medium to high.

Power of Buyers:

The individual doesn't pose much of a threat to the banking industry, but one major factor
affecting the power of buyers is relatively high switching costs. If a person has one bank that
services their banking needs, mortgage, savings, checking, etc, it can be a huge hassle for that
person to switch to another bank.
To try and convince customers to switch to their bank they will often lower the price of
switching, though most people still prefer to stick with their current bank.

The internet has greatly increased the power of the consumer in the banking industry. The
internet has greatly increased the ease and reduced the cost for consumers to compare the prices
of opening/holding accounts as well as the rates offered at various banks.

ING Direct introduced high yield savings accounts to catch the buyers' attention, then they went
a step further and made it very easy for customers to transfer their money from their current bank
to ING. ING was successful in its attempt because it managed to make switching costs very low
in terms of time and capital.

Availability of Substitutes:

Some of the banking industry's largest threats of substitution are not from rival banks but non-
financial competitors. The industry does not suffer any real threat of substitutes as far as deposits
or withdrawals, however, insurances, mutual funds, and fixed income securities are some of the
many banking services that are also offered by non-banking companies.

There is also the threat of payment method substitutes and loans are relatively high for the
industry. For example, big-name electronics, jewelers, car dealers, and more tend to offer
preferred financing on "big ticket" items. Oftentimes these non-banking companies offer lower
interest rates on payments than the consumer would otherwise get from a traditional bank loan.

Competitive Rivalry:

The banking industry is considered highly competitive. The financial services industry has been
around for hundreds of years, and just about everyone who needs banking services already has
them. Because of this, banks must attempt to lure clients away from competitor banks. They do
this by offering lower financing, higher rates, investment services, and greater conveniences than
their rivals. The banking competition is often a race to determine which bank can offer both the
best and fastest services but has caused banks to experience a lower ROA (Return on Assets).
Given the nature of the industry, it is more likely to see further consolidation in the banking
industry. Major banks tend to prefer to acquire or merge with other banks than to spend money
on marketing and advertising.
 SCOPE OF INTERNET BANKING

Strength

 Customer access to information 24 hours a day

 Timely access to information
 Ability to offer a customer more than one method of retrieving information
 Sophisticated technology systems
 Diversity helps to capture different types of market.
 The ability to cut internal cost due to advanced technology
 Increased efficiency due to automation
 Increased accuracy of banking transaction
Weakness

 High cost of service

 Continual wants of customers wants and needs
 Hostile feelings of employees due to possible pending layoffs due to automation
 Multiple option for the customers
 Initial investment in technology will be expensive
Opportunities

 The ability to have a larger customer base

 Global expansion-This is an enormous market which will be a great opportunity in the
future
 The ability to take advantage of the growing opportunity of internet banking
Threats

 Continual changing technology.

 Uncertainty of the banking industry.
 Competition from the lower price operation.
 Possible failure of product due to non-acceptance of customers.
 CHALLENGES OF INDUSTRY

5 Issues and Challenges in The Internet Banking Sector

Online banking has many benefits. Two of the most important are speed and convenience.
People who participate in online banking can access their accounts, view their statements, make
transactions, pay bills, and more, all from their homes, or on the go. It is because of these
benefits that roughly 51 percent of U.S. adults participate in online banking.

However, despite the benefits of online banking, there are also several distinct issues and
challenges in the online banking sector. These are highly significant both for banks that offer
online banking, but also for their customers, who depend on the banks to operate effectively.

Online banking marketers need to know these challenges so that they can efficiently navigate
them.

Here are some of the top issues and challenges in the online banking sector that marketers need
to be aware of:

1. Traditional Banking Habits

Despite the benefits of online banking, 49 percent of American adults do not participate in it at
all. This happens mainly because traditional banking is what many people are used to and it can
take time for them to break habits. So, online banking marketers should focus on ways to
convince traditional banking users to start using online banking services.
These marketing efforts should specifically highlight the numerous benefits of online banking.
They need to show people how online banking can solve traditional banking problems more
efficiently (having to go to bank branches, higher fees, etc.)

2. Security

Security is one of the most significant challenges for online banking marketers. This is because,
in the past, if a robber was going to steal a person's bank savings, he or she would have to break
into the bank vault and make a daring escape with the money. This was an extremely difficult
prospect and involved a lot of danger and risk.

With online banking, cybercriminals simply need to ascertain certain personal information to
break into a person's account and steal their money. It can be done anonymously and involves
significantly less physical danger than in the past.in fact, in the U.K. in 2015, roughly 130
million British pounds were stolen from online bank accounts through fraud. So, security is still
a major issue for online banks and their customers. Marketing professionals in the online
banking sector need to focus on demonstrating and explaining the security of online banks to
overcome this challenge.

3. Transaction Difficulty

It can be significantly more difficult and time-consuming to deposit or withdraw money from an
online bank. Not only do online banks often have fewer ATMs than their traditional counterparts,
but they also can simply take longer amounts of time for deposits to be processed and put into a
bank account. For example, it takes roughly 3-5 days for deposits to show up in accounts for
PayPal, one of the largest online banks. This is an issue that online banking marketers will most
likely struggle with until online banks speed up their transaction times.

4. Technical Issues

Because online banks rely so heavily on their online platforms, this means that they can generate
substantial losses if their systems crash or if there are bugs in their code. A single technical issue
that causes a bank to be down for a day could cost the bank millions in losses.it can also wreak
havoc for the bank customers who may not be able to make payments or conduct transactions
during the time that the site is down. 54 percent of consumers now use a mobile banking app. So,
it is key not just for banks to have their online platforms running smoothly, but also, their mobile
apps. A loss of funds or data due to a crash is something that can be very worrisome for bank
customers. So, marketers should prioritize alleviating this worry by explaining how account
funds will not be lost if technical issues occur.

5. Small Budgets

Many startups have to operate on shoestring marketing budgets before they grow to a larger size.
This can be a major challenge. If your marketing budget is small, then you need to focus on the
priority expenses. The inbound marketing strategies of creating a search engine optimized
website, making accounts for all of the biggest social media networks (Facebook, LinkedIn,
Twitter, etc.), and starting a blog should all be prioritized. On your website, you should also have
an option to allow visitors to join your mailing list. Furthermore, a good PPC campaign can be a
very good investment for your company. Businesses make an average of $3 on every $1.60 they
spend on Ad Words.

ADVANTAGES
Advantages of Internet Banking

Some advantages of online banking go hand-in-hand with simply being online; others are
competitive advantages provided by online banks taking advantage of their cost structure. The
most prominent benefits provided by online banking include:

 24/7 account and service access

 Speed and efficiency
 Online bill payment
 Low overhead can mean low fees
 Low overhead can mean high-interest rates on deposit account

24/7 Account and Service Access

Online banks are accessible 24/7, as long as you have an internet connection. Some online banks,
such as Ally Bank, take this perk one step further, giving you 24/7 phone access to a real-life
customer service agent. This can be extremely helpful if you don't have access to the internet, or
if you feel you need the assistance of a human brain, rather than a computer algorithm.

Speed and Efficiency

If you need to transfer money, apply for a new loan, or perform nearly any banking transaction,
you'll typically have to wait in line at a bricks-and-mortar banking location. With an online bank,
there's never any waiting. As long as you can log in, you can access your accounts, request a new
credit card, or perform nearly any banking transaction you desire without driving down to a bank
or waiting in line.

Online Bill Payment

One of the great advantages of online banking is online bill pay. Rather than having to write
checks or fill out forms to pay bills, once you set up your accounts at your online bank, all it
takes is a simple click — or even less, as you can usually automate your bill payments. With
online bill pay, it's easy to manage your accounts from one central source and to track payments
into and out of your account.

Low Overhead Can Mean Low Fees

Online banks don't have to pay for things like electricity, janitorial services, landscaping, or rent,
so they can pass those savings along to customers. Typically, this means that online banks can
charge fewer fees than traditional banks. For example, most online banks offer a free online
checking account with no deposit, along with other no-fee bank accounts, such as IRAs. There
are some online banks with free checking and no minimum balance; if you're worried about
applying for an account with bad credit, you might be able to open a bank account online for
free, no credit check required, although there might be ongoing fees.

Low Overhead Can Yield High Rates

In addition to offering low fees, online banks often have the best interest rates, whether you are
looking for a certificate of deposit, a high yield checking account, or deposit accounts with high
interest, such as a money market account. Although rates fluctuate, if you look at a current list of
best CD rates or best free online checking account rates, you'll usually find that the banks paying
the best interest rates are online banks.

Disadvantages of Internet banking

 Customers may have to face risky transactions & fraud.

 Failure of the power supply causes the breakdown of the system.
 Loss of heavy income at times of settlement of higher magnitude.
 The cost involved in training staff may not be profitable especially in times of attrition.
 CHAPTER-2
LITERATURE REVIEW
 LITERATURE REVIEW
In this field, few studies were conducted in India. The researcher reviewed many researchers
conducted in India and abroad to find out the correct area to carry out the research work, which
will fruitful for the professionals and country.

J. Rajini &V. Krishnamoorthy (2020).

This paper identifies the dimensions of internet banking service quality and the influence on
customer satisfaction. The research is based on a theoretical model which consists of five
internet bank service quality dimensions and one exogenous variable. The data have been
collected from 250 bank customers. A total of 250 Internet Bank customers participated in the
study and provided data. The researchers used the convenience sampling method for collecting
data from the respondents. The findings of factor analysis revealed five dimensions of internet
bank service quality, namely Responsiveness, Trust, Convenience, Efficiency of Website, and
Security. Among the internet bank service quality dimensions, trust and efficiency of a website
where are found to be positively affecting customer satisfaction. These study findings would help
the policymakers in general, bank officials in particular to develop suitable policies relating to
internet bank service quality.

Dr.K. Sathyabama & R. Samundeswari (2019).

The purpose of this research is to search and examine the factors which influence customer
satisfaction towards Internet banking. The four factors which can influence customer satisfaction
toward Internet banking include service quality, web design, security and privacy, and
convenience. With the use of a questionnaire survey, 120 working adults who participated in this
study have provided valuable feedback and responses of the above factors that influence
customers' decision to do Internet Banking. The results of this research showed that web design,
convenience, and security are closely linked to customer satisfaction toward Internet banking.

Ruchika Gupta & Siddharth Varma (2019).

The study is based on a survey of banking customers particularly in the National Capital Region
of Delhi. The study is limited to two innovations in the banking industry: credit/debit card and
internet banking. Emergencies of technology and competitive pressures led by financial
liberalization are driving fundamental shifts in the way Indian banks operate and deliver services
to their customers. Banks are progressively moving towards an age of high-technology banking
to ensure operational excellence and higher customer satisfaction. The use of technology for
providing banking services requires an investment of money and time and it becomes imperative
to understand whether technological innovations boost the level of customer satisfaction. This
paper attempts to measure the impact of demographic variables on various determinants of
customer satisfaction in the Indian banking industry.

Hossam deraz and Faisal Idris (2019).

This paper presents a systematic review of the literature on satisfaction in Internet banking. This
review aims to address this gap in the literature by identifying the antecedents predicting
customer satisfaction in Internet banking literature. Achieving our aims will bring together
fragmented literature to serve as a foundation for research into customer satisfaction in Internet
banking involving the use of Internet banking and other related digital platforms such as mobile
banking. The results show that Asian countries recorded the highest number of publications.
Also, we identified limited research from specific regions.

Viktorija Skvarciany * and Daiva Jureviciene (2018).

According to the experts, the most powerful factor in the trust-building process in Lithuania and
Latvia is the internet banking system while in Estonia, the website. The research has the
following limitations: The online survey of individual customers (however, internet banking
relates to internet users, so this limitation is not essential); the analysis of only the positively
affecting criteria of the trust-building process; only experts assessed the sub-factors.

D. Vijayalakshmi*, M.V. Rajasekhar (2018).

The study found a significant relationship between demographic factors (age and gender) and
satisfaction on some banking service quality factors and no impact for the remaining factors. The
findings of the study may help a banker to identify the critical areas to pay attention to, for
improving decision-making in marketing, and segmentation and targeting of customers to
increase customer satisfaction in internet banking.

Magadha Y. Keskar and Neeraj Pandey (2018).

These papers were grouped by research themes, and customer satisfaction with internet banking
was identified as the most common theme. is paper presents an exhaustive review of literature on
the current developments in internet banking? It provides an overview of the changes as well as
the ongoing research on internet banking. To identify relevant works, research databases.
Jeffrey E Jarrett(2015).

This paper presents the purpose is to note the likelihood of continued growth of internet banking
and commerce as individual consumers purchase more and more products to access the internet
and complete both financial and consumer transactions. A challenge is made to software and
hardware producers to use modern methods and techniques to predict where problems exist in
internet banking and commerce. Serious solutions are necessary.

A. Samsunisa (2015).

The researcher has identified that different age groups of customers have different perceptions
toward the banking services and the usage level of these banks' customers is different so the bank
should concentrate on all the age groups of customers for the betterment of internet banking. It
has also been seen that different occupation groups of customers have different perceptions
toward banking services. There is a good number of customers in every group like a student,
service class, business class, and professionals, it shows that they all are keenly interested in
using the internet banking services.

Vikas Chauhan and Vipin Choudhary (2015).

The present paper attempts to understand the concept of internet banking as well as study the
benefit of internet banking from the perspective of consumers as well as banks. Further, this
paper discusses the challenges and opportunities associated with internet banking in the Indian
context. The discussion Concludes that Concept of Internet banking Is slowly gaining
Acceptance in Indian Scenario and Efforts are Being made by government Agencies to make It
more Popular among consumers.

Dr. M. Abdul Hakeem and Y. Mayadeen Sha (2015)

In their analysis it was observed that particular age groups have used these services, the
satisfaction of the customer majorly influenced the convenience, awareness, and responsiveness.
In the present technological society, most banking customers prefer and switch to internet
banking facilities. So, the banker may improve their services, loyalty to customers, and retention
by increasing awareness of other age groups and concentrating on the factors contributing to
customer satisfaction.
Vandana Tandon Khanna & Neha Gupta (2015)

The study shows the factors such as Technology acceptability, safety, availability, user-
friendliness, and accessibility highly depend on the demographic profile of the population size.
Most marketing decisions in terms of enhancing the effectiveness of delivery channels can be
taken by considering these factors.

Jayshree Chavan (2015).

In his research paper:" This study presents New Information technology has taken an imperative
place in the future expansion of financial services, especially banking sector conversion are
affected more than any other financial provider groups. Increased use of mobile services and the
use of the internet as a new division channel for banking transactions and international trading
requires more concentration towards e-banking security against deceptive activities. The
development and the increasing progress that is being experienced in Information and
Communication Technology have brought about a lot of changes in almost all facets of life. In
the Banking Industry, it has been in the form of online banking, which is now replacing the
traditional banking practice. Online banking has a lot of benefits that add value to customers'
satisfaction in terms of a better quality of service offerings and at the same time enable the banks
to gain more competitive gain over other competitors.

Neetu Jain & DR. Pooja Malhotra (2014), in their research paper "Demographic Factors
Affecting the Adoption of Internet Banking in India".

The goal of this paper to find out the demographic factors affecting the adoption of banking in
general and Internet banking in particular in India. The data for this study is based upon a survey
of bank customers using a convenience sampling technique with the aid of a structured self-
administered questionnaire. The results of this study indicate that age, education, income, and
profession are the most influential demographic variables affecting Internet banking usage.
Using a mailed questionnaire with a response rate of 38.9 percent, it was found that 40 percent of
the Indian consumers who responded to this survey were already using Internet banking services.
The results of this study provide interesting additions to knowledge of banking and contribute to
our understanding of Internet banking users as well as to non-users.

Ms. Fouzia (2014), The purpose of this paper is to determine the customer's perception
onward the Internet-banking services.

The total number of customers taken for the study is 196. Analysis of variance technique is
employed to study the significant relationship between the occupation and customer perception
of internet banking services and significant relationship between the age and customer perception
of internet banking services. The result of the study clearly shows that different age groups of
customers and different occupation groups of customers have different perceptions toward the
banking services. The results also propose that demographic factors impact significantly internet
banking behavior, specifically, occupation and age. Finally, this paper suggests that.

Pankaj Mishra (2013)." Customer satisfaction, Demographic factors"

The growth in the banking sector is largely dependent upon the trust that customers put in banks
and is highly derived from the satisfaction that the banks provide to these customers. Therefore a
constant assessment of customer satisfaction is essential for the banks, which many a time, in
turn, is influenced by various external factors, especially the demographic factors related to the
consumer population. This research paper attempts to study the demographic factors and their
influence on customer satisfaction towards banking services in Gwalior city. The outcome of this
study will provide insight into the differences in customer satisfaction that may be brought about
by the demographic background of customers and will help the stakeholders to comprehend the
underlining importance of demographic variables in the process of assessing customer
satisfaction.

Norlida Mohd Noor, Khalizani Khalid(2012).

In this research, the researcher said that Using classified multiple regression analysis, we
controlled the variables of age, income, and education levels, and found that staff supports and
knowledge of web security and trust were significant predictors for customer satisfaction towards
Internet banking services. It is hoped that findings from the study provide greater insights to
bank managers as to what affects the users' satisfaction towards internet banking.

Rah math Safeena (2011)

In their research work "Internet Banking Adoption in an Emerging Economy: Indian Consumer's
Perspective" analyzed the factors influencing the consumer's adoption of internet banking in
India and hence investigates the influence of perceived usefulness, perceived ease of use, and
perceived risk on the use of Internet Banking.

Safeena (2010).

In her study, she determines the consumer's perspective on internet banking adoption. Finding
shows that perceived usefulness, perceived ease of use, consumer awareness, and perceived risk
are the important determinants of online banking adoption and have a strong and positive effect
on customers to accept the online banking system.
Khan M. S., Mahapatra S. S., (2009).

Demographic analysis of data reveals that gender is hardly a bias for use and evaluation of
service quality of i-banking in most of the cases across various categories of customers. A valid
mathematical model is proposed to assess the overall service quality using regression analysis.
The results show that customers are satisfied with the quality of service on four dimensions such
as reliability, accessibility, privacy/security, responsiveness, and fulfillment, but least satisfied
with the 'user-friendliness' dimension. the empirical findings not only priorities different
parameters but also provide guidelines to bankers to focus on the parameters on which they need
to improve. banking: an empirical study in India"

OBJECTIVES
 To examine the components of internet banking
 To examine the impact of internet banking on customer's satisfaction
 To determine the factors limiting the use of internet banking.

RESEARCH GAP
Internet banking is changing the whole banking industry, having effects on banking relationships
and their performance. So, this aspect cannot be undermined and need to be researched
thoroughly.

 To find the increasing significance of internet banking.

 To examine the impact of trust on customer satisfaction.
 To evaluate the impact of service quality on customer satisfaction and business
performance.
 To examine the impact of perceived usefulness and perceived ease of use on the intention
to use internet banking and hence customer satisfaction and employee satisfaction.
 To evaluate the impact of customer satisfaction on customer commitment.
 CHAPTER-3
RESEARCH METHODOLOGY
 RESEARCH METHODOLOGY
Research means to find something new or provide a solution to the existing problem. Now a
day's research gains importance because people's needs, wants and expectations are changed
rapidly. People want something new day by day. Research helps an organization to provide
goods and services as per people's demand.

 Research objectives (Primary & secondary objectives)

To Attract Customers

one of the important objectives of internet-banking is to attract customers. It's helping the
customers by providing online services. it is attracting customers and making the banking system
easier.

To Boost Economy

Internet banking helps to boost the economy because online transaction helps to maintain the
cash in the economy, which would be using during the recession of the economy.

To Provide 24/7 Service

The world economy is growing; people are doing business globally. it requires 24*7 banking
service. Internet banking doing the same, to provide 24*7 service. it is one of the important
objectives of internet banking.
Research Methodology

Research is a systematic process of gathering knowledge and facts to find the solution to a
problem. The research methodology is a way to systematically solve the research problem. It
includes the overall research design, the sampling procedure, data collection method, and
analysis procedure

Research Design

The research design should point out whether the study is descriptive. It should also specify
whether it is a statistical or experimental design. The research design that has been adopted for
the study is descriptive. The methodology involved in this design is mostly quantitative. The
research design refers to a framework or blueprint of the research which is found out the solution
to the problem.

RESEARCH DESIGN OF 6W’s:

WHO?
After deciding the geographical area the questions come who be studied. This study is
conducted by kaushlesh and Mehul.

What?
In this research, the factor is to study the working women investment patterns in Ahmedabad
city. What are the different investment options to which working women are giving preferences?

When?

Whether it is an appropriate time to study the subject finalized the research? This study is
conducted in only 3 months. This is not an appropriate time. Very short period for the study.

Where?

The geographical area to be covered under the research is another important question. It not
possible to cover the entire population under any research the same way, it is also not possible to
cover the entire geographical area under any research. Hence it becomes important to decide
where the research is to be conducted. This study is covered especially Ahmedabad city only.

Why?

Why is the study required? It is important to understand why the research is Being conducted.
The study determines the satisfaction level of internet banking. This study focuses regard to
gender also.

How?

This question is the sub-set of the previous question "which". The data collected needs to be
analyzed appropriately in order and get a reliable result. This the study is conducted through 450
questionnaires.
 SAMPLING DESIGN

Types of
Research

Exploratory Descriptive Experimental

1. Exploratory Design

An exploratory design is conducted about a research problem when there are few or no earlier
studies to refer to. The focus is on gaming insights and familiarly for later investigation or
undertaken when problems are in a preliminary stage of an investigation.

2. Descriptive Design

Descriptive research designs help provide answers to the questions of who, what, when, where
and how associated with a particular research problem. A descriptive study cannot conclusively
ascertain answers to why. Descriptive research is used to obtain information concerning the
current status of the phenomena and to describe "what exists" concerning variables or conditions
in a situation.

3. Experimental Design

An experimental design is also known as a causal study. Causal studies may be thought of as
understanding a phenomenon in terms of conditional statements in the form, "if X, then Y."This
type of research is used to measure what impact a specific change will have on existing norms
and assumptions. Most social scientists seek causal explanations that reflect tests of hypotheses.
The causal effect occurs when variation in one phenomenon, the dependent variable