FINANCIAL LITERACY OF SERVICE BUSINESS TOWARDS

ONLINEBANKING ON SELECTED AREAS IN

IMUS, CAVITE: AN ANALYSIS

INTRODUCTION

Business nowadays has its own different types according to what they offer and

how big/small their businesses. One of the types of business is Service business, it’s a

commercial enterprise that provides work performed in an expert manner by an individual

or team for the benefit of its customers. The typical service business provides intangible

products, such as accounting, banking, consulting, cleaning, landscaping, education,

insurance, treatment, and transportation services. Such businesses should not only conduct

good management practices, they must also know how to be literate in terms of finance.

(According to the study of William Sucuahi, Determinants of financial literacy of micro-

entrepreneurs in Davao City, 2013) Financial literacy topics such as record keeping,

budgeting, personal finance and savings were viewed to be more important to lower-

income individuals. This suggests that financial educators should not only teach how to

save or ways to save, but also the why’s to save.

Banks also plays vital role in social developments. Business can’t get rid of the big

help of the banks, as it is the following; It collects the finance from different business in

the form of deposits and investments, provides this finance to different businessman in the

form of debts and loans, and when it comes in country’s economic developments it helps

to flourish. This is a global and competitive world, and in this Competitive World, it is

important for every bank to provide modern facility to maintain customers loyalty of their
bank. People can’t get rid to the fact that internet has changed the operations of many

businesses and has been becoming a powerful channel for business and it makes the

business more globally competitive. The banking industry has followed this trend in recent

years, and sometimes called "online banking" referring to all banking transactions now

completing through Internet applications.

(According to Investopedia) Online banking allows a user to execute financial

transactions via the internet. Online banking is also known as "internet banking" or "web

banking." An online bank offers customers just about every service traditionally available

through a local branch, including deposits, which is done online or through the mail, and

online bill payment. Online banks handle customer service by phone, email or online chat.

Online banking is frequently performed on mobile devices as Wi-Fi and 4G networks have

become widely available. People are now literate that bank is the financial institution,

which provides different financial services to customers with the help of innovated

technology. Being financially literate at your business might be the edge and successful

tool to grow and to gain. In-depth knowledge of financial literacy is required to understand

how money works and how it can work for you – even when you’re sleeping – by investing

in profitable areas like the stock or money market. To understand money and how it works,

it’s important to understand common financial literacy principles such as; financial goals,

budgeting, investments, superannuation, contracts and employment models.

Most of the business nowadays has already practicing being wise when it comes to

money. Spending wisely, allocating budget and saving money carefully are key points to

be qualified as literate. The level of financial literacy affects the quality of life significantly.

It affects the ability to provide to for something, the attitude to money and investment, as
well as the contribution to community. Financial literacy enables people to understand what

is needed to achieve a lifestyle that is financially balanced, sustainable, ethical and

responsible. It also helps entrepreneurs leverage other people’s money for business to

generate sales and profits.

Statement of the Problem
This study assesses the Financial Literacy of Service Business Towards Online

Banking on Selected Areas in Imus, Cavite.

Specifically, the study answered the following questions:

1. What is the profile of the participants in terms of:

a. Name of business;

b. years of operation;

c. average annual income;

2. What is the assessment towards financial literacy of the participants?

3. What is the level of understanding on online banking system?

4. What are the factors influencing the adoption of online banking?

a. external

b. inherent

5. What are the advantages using online banking?

6. What is the perceived effect using online banking of online banking system?

7. Is there any significant relationship between Financial literacy level and perceived

effect in online banking?

8. Is there any significant relationship between financial literacy and advantages using

online banking?
 Objectives of the Study

The main objective of the study is to assess the Financial Literacy of Service Business

Towards Online Banking on Selected Areas in Imus, Cavite: An Analysis

Specifically, the study aimed to:

1. determine the profile of the participants in terms of;

a. name of business;

b. years of operation;

c. average annual income;

2. assess the financial literacy of the participants.

3. to determine the level of understanding on online banking system.

4. to know the factors affecting the adoption of online banking.

a. external

b. internal

5. to enumerate the advantages using online banking.

6. to know the perceived effect of using online banking

7. to know if there is any significant relationship between Financial literacy level and

perceived effect in online banking.

 8. to know if there is any significant relationship between financial literacy and

advantages using online banking.

Significance of the Study

This study provides the following value:

To the Students. This study is beneficial for those who taking up Financial

Management subjects, where in it contains specific terms that can be used related to their

course. On the other hand, this study can widen their knowledge about Financial literacy

towards online banking.

To the Bank. This study will help them improve the system, its function, find an

alternative way to be effective and competitive.

To the Customer. This study will provide some security and privacy to customers,

by using state-of-the-art encryption and security technology and it will help them to be

more literate when it comes to online banking with maximum satisfaction.

To the Teaching Professional. This study can also be used as an additional input

to their lessons.

To the Future researchers. This succession of the study may serve as a reliable

reference for their future revisions of related study.

Time and Place of the Study

The study was conducted in the Philippines from September 2018 to March 2019.

Specifically, this study is only limit to the Salon & Spa businesses in Imus, Cavite.
Scope and Limitation of the Study

This study is limited to the Personal Care Service type of business located in Imus,

Cavite. The researchers will be going to figure out their financial literacy towards online

banking. Being literate financially is one of the edges and a successful tool in every

business, that’s why this can help them to enlighten their business literacy towards online

banking, also, this is addresses to their performance and practice for using online banking

such as advantages, effects and how their operation being affected by the said practice.

Conceptual Framework

The figure shows the conceptual framework of Financial literacy of Personal Care

Business Towards Online Banking.

-Profile of the -Financial Literacy
participants Assessment
FINANCIAL
-Financial literacy -Evaluation of online LITERACY OF
banking system SERVICE
-Level of understanding
BUSINESS
-Correlationa analysis
-Factors influencing the TOWARDS
between financial
adoption of online ONLINEBANKING
literacy and
banking ON SELECTED
Effectiveness
AREAS IN
a. External IMUS, CAVITE: AN
-Correlationa analysis
b. Internal between financial ANALYSIS
literacy and advantages
-Advantages of using when using online
online banking banking
Figure. 1 Conceptual Framework

The figure above explains the conceptual framework of the study and illustrate the

financial literacy of service business (Personal care Business) towards online banking. This

study determined how service business uses online banking and how online banking affects
their business. The Profile of the business tells how long they have been in the industry.

When the profile and factor affecting the online banking system have been taken, the

researchers analyzed the literacy of their financial and their level of understanding in online

banking, that’s the time that result/ efficiency of adopting online banking literately will

reveal.

Definitions of Terms

Financial Literacy- is the possession of the set of skills and knowledge that allows an

individual to make informed and effective decisions with all their financial resources.

Online banking- Online banking allows a user to execute financial transactions via the

internet. Online banking is also known as "internet banking" or "web banking." An online

bank offers customers just about every service traditionally available through a local

branch, including deposits, which is done online or through the mail, and online bill

payment.

Service Business- is a form of business providing different types of labor services in a

wide variety of business sectors, e.g., lawn mowing, housecleaning and clothes cleaners

are three types of consumer services offered to the public.

 REVIEW OF RELATED LITERATURE

In exploration, we find new techniques, new knowledge, even develop new

substances, gadgets, equipment, processes/procedures, imagination and skill employed by

the researcher. The commodities, new devices, services, in technology are needs of man

for better-fuller life which is the concern of the research. These useful arts are the products

of the technological environment and the end-user society in general. The fast-growing

trend and innovation in technologies today prompts researchers to conduct studies about

how the Online Banking can help the Service Business in Imus, Cavite. This chapter

presents a brief review of literature and studies, both local and foreign that is related to

these studies.

Effectiveness of E-Banking services of private bank, Allie V. Agustin, (Oct. 2015).

Most people are very familiar with how a bank operates. The concept is very simple, if the

customer takes his money to the bank and they will keep it safe for him, and he can collect

it later. There are other uses of a bank, such as loans and interest. But with nearly everything

going digital, including money transfers, paychecks, bill payments and debit cards, cash is

practically becoming obsolete. With online banking, the customer won’t ever have to worry

about full access to his account. He has quick and easy 24-hour access from anywhere in

the world. The customer won’t ever have to rush over to the bank after work and fight lines.

Other bank accounts don’t commonly offer the best deal available when it comes to saving

the customer’s money. Also, because online banking services don’t have to rent a building,

they offer higher interest rates with their savings accounts. By using other services on a
bank, mostly it is time consuming and to make money, they often charge expensive fees to

consumers

Adoption of online banking in Manila, Edralin C. Lim, (Feb. 28, 2013). E-Banking

is defined in many ways. These definitions are primarily focused on the various distribution

channels of financial institutions like the use of internet, phone, automated teller machine

(ATM) and kiosk (IT Director, 2002; Bankers Online, 2003; FFIEC, n.d.) IT Director

(2002) defined e-banking as “the use of electronic channels to communicate and transact

business with both domestic and international customers, primarily through use of the

Internet and the World Wide Web.” Bankers Online (2003) defined e-banking as “an

umbrella term for the process by which a customer may perform banking transactions

electronically without visiting a brick-and-mortar institution.” Federal Financial

Institutions Examination Council (n.d) defined e-banking as “the automated delivery of

new and traditional banking products and services directly to customers through electronic,

interactive communication channels. “

Determinants of Financial Literacy of Micro Entrepreneurs in Davao City, William

Sucuahi, (2013). Financial literacy topics such as record keeping, budgeting, personal

finance and savings were viewed to be more important to lower-income individuals. This

suggests that financial educators should not only teach how to save or ways to save, but

also the why’s to save (Rhine and Comeau, 2000). In this study the researcher used these

four topics to measure the financial literacy of micro entrepreneurs. Savings is another

component which serves as economic security (Braunsten and Welch, 2002) and also for

accumulation of wealth (Gokhale, 2000) for an improved living standard. However, micro

entrepreneurs are lack of necessary discipline and willingness in advancing their business
skill including saving ethics (Karides, 2005). Budgeting, on the other hand, refers to the

expenditure planning and cash flow analysis (Uddin, Chowdhury and Zakir, 2009) which

is very important to the success of the business operation and processes (Bragg and Burton,

2006). However, Torres (2008) found that small business owners are not concerned about

budgeting; their concern is more of the cash flow.

The Meaning of Financial Literacy and its Importance, (Oct. 7, 2013). Financial

literacy is the ability to understand how money works: how someone makes, manages and

invests it, and also expends it (especially when one donates to charity) to help others.

In-depth knowledge of financial literacy is required to understand how money works and

how it can work for you – even when you’re sleeping – by investing in profitable areas like

the stock or money market. To understand money and how it works, it’s important to

understand common financial literacy principles such as; financial goals, budgeting,

investments, superannuation, contracts and employment models.

Determinants and Implications, Amelina Aprecia Sjam, (Nov. 2015). Financial

literacy is positively associated with the way individuals manage their finances over time

(Braunstein & Welch, as cited in Danes et al., 2013). For example, higher financial literacy

is associated with less credit card debt, higher savings rates, and fewer personal

bankruptcies (Bernheim, Garrett & Maki,as cited in Danes et al. 2013). Mandell (2006)

defined financial literacy as is what people must know in order to make important financial

decisions in their own best interest. However, this working definition appears to be

somewhat inadequate since it has been applied to young people. Teenagers who are age 17

or 18 years old tend to not make many important financial decisions and, as a result, tend

not to retain much of what they learn in formal courses about buying a house, investing in
securities, purchasing insurance or saving for retirement. This disconnect causes a lot of

problems for well-meaning adults who want youngsters to be financially literate enough to

avoid severe difficulties. They know that it is virtually impossible to reach people who

have completed their mandatory school years with education that takes more than a few

minutes to impart. Yet this does not stop them from hoping that personal finance classes

will deliver financial literacy that is “sticky” enough to persevere to adulthood (Mandell,

2006). Garman, Leech and Grable; Joo and Grable (Mandell, 2009a) have found that poor

financial decisions can hurt productivity in the workplace. Volpe, Chen and Liu (Mandell,

2009a) surveyed corporate benefit administrators who identified basic personal finance as

a critical area in which employee knowledge is deficient.

Financial Literacy and the Success of Small Businesses: An Observation from a

Small Business Development Center, Pearl Dahmen, (2014). Small business is the

backbone of the U.S. economy; when the financial literacy skills of entrepreneurs fall short

of those needed to operate a successful business, it is more than the individual business at

risk. In 2012, 14 small businesses requesting growth-acceleration consulting services from

the Florida Small Business Development Center at the University of South Florida were

assessed financially as part of the service provided by the Center. Financial ratios were

used to analyze the business’s financial condition. While performing the financial analysis

of these firms, we also surveyed the business owners to determine their level of financial

understanding and their use of financial statements in making management decisions. We

found a strong association between the small businesses' financial strength and the business

owners’ habits of mind with regard to their financial statements: for 7/14 of the businesses,

the business owner did not regularly review financial statements, and 6/7 of those
businesses were experiencing financial difficulties; conversely, 7/ 14 of the businesses in

the study were experiencing financial difficulties, and for 6/7 of them, the business owner

did not regularly review the financial statements

Measuring Service Quality in the Banking Industry: A Hong Kong Based Study,

Mei Mei Lau, (Sept. 2013). Banks play an important and active role in the financial and

economic development of a country. An effective banking system greatly influences the

growth of a country in various sectors of the economy. Practitioners in the banking industry

face a large number of complex challenges in the global marketplace. It is crucial for banks

to better understand changing customer needs and adopt the latest information technology

system in order to compete more effectively with global organizations (Malhotra &

Mukherjee, 2004). Hong Kong has been enjoying strong economic growth in the Asia

Pacific region and is one of the key international financial centers in the world. Indeed, the

success of the banking system supports currency stability, which is the primary objective

of the monetary policy in Hong Kong. Hong Kong is one of the top ten largest banking

centers in the world (The Standard, 2011). The sector contributed over 15% of Hong

Kong’s nominal GDP in 2010, and the total employment is around 80,000 (Censtatd,

2011a, b). Currently, 172 banks are now operating in Hong Kong, which is a relatively

large number compared with many international cities (The Hong Kong Association of

Banks, 2011). However, globalization has altered customer behavior in regards to banking

services, and the operating environment for banking industry has become more dynamic

and competitive. The emergent of new forms of banking services such as automated teller

machines, internet banking, and phone banking as well as the maturing financial market
and global competition accelerate the need for bankers to explore the importance of

customer satisfaction and customer loyalty.

 Methodology

This chapters represent the methodology used by the researchers in the conduction

of the study.

Research Design

This study used Qualitative Research Design, Purposive Research is employed in

this study entitled “Financial Literacy of Service Business Towards Online Banking on

Selected Ares in Imus, Cavite: An Analysis. The researchers used set of questionnaires.

Some of the questionnaire were adopted and Also, researchers made their own

questionnaire that surely help the entire study. With the help of selected and owned

questionnaires the researchers found helpful information.

Hypotheses of the Study

H°: There is no any significant relationship between Financial literacy level and

perceived effect in online banking.

H°: There is no any significant relationship between financial literacy and advantages using

online banking.

Sources of Data

The researchers used primary data for the accurate results. Primary data based on

the profile of the respondents and their level of understanding towards online banking and

the assessment of their financial literacy. A survey questionnaire which consist of different
situation and experience used to obtain information from the sample as the primary data.

Primary as major source of data

Participants of the Study

Participants of the study are selected salon and spa who are registerd to the

Municipality of Imus, Cavite. 50 (Fifty) salon and spa in the different location within the

city of Imus.

Data Gathering Procedure

The data will gather from the registered Salon & Spa businesses in Imus, Cavite.

The questionnaire that is related to the study was prepared and checked by the researcher

adviser. The final draft was approved and distributed to the participants through personal

survey. The questionnaire was distributed to the Salon & Spa businesses in selected areas

of Imus, Cavite. (According to Wikipedia) A personal interview survey, also called as a

face-to-face survey, is a survey method that is utilized when a specific target population is

involved. The purpose of conducting a personal interview survey is to explore the

responses of the people to gather more and deeper information . Distributing personally of

questionnaire will help the researchers gather the quick response of the sample within the

day. Distributing the questionnaire can gain the researchers more knowledge with the help

of interaction towards the real operation.

Research Instrument

A structured questionnaire will be used for this study. Most of the questions are

based on previous researches. Some questions are modified to address the specific nature

of the study.

The questionnaire for this study is consisted of an introduction to the research

followed by the list of questions. The introduction on the first page of the site before the

participants were able to start the actual survey, the half part of it determined the profile of

the business, on the next part,the measurement of the participants financial literacy and

then followed by the different features of online banking. This kind of questionnaire is only

for the business who uses online banking for their operation.

Sampling Technique

This study will be going to use Purposive Sampling, A Non- Probability, Purposive

sampling (also known as judgment, selective or subjective sampling) is a sampling

technique in which researcher relies on his or her own judgment when choosing members

of population to participate in the study. In this type of sampling, Researchers often believe

that they can obtain a representative sample by using a sound judgment, which will result

in saving time and money. With this type of technique researchers used some criteria for

this study and these are Salon and spa in Imus Cavite, registered in the municipality of

Imus and lastly, the salon and spa who only used online banking in their operation the

researchers choose the size sample of 50 and will be distributed throughout the selected

areas in Imus Cavite.

Statistical Treatment of Data

Likert Scale

A Likert Scale is a type of rating scale used to measure attitudes or opinions. With

this scale, respondents are asked to rate items on a level of agreement. This will give a

scale of one (1) to five (5) to analyze different opinions and knowledge of the participants.

Frequency & Percentage

Frequency - it is the number of times the data values occur. In the study, it will be

used to compute the percentage.

Percentage - a percentage is another way of expressing a proportion. A percentage

is equal to the proportion times 100. In the study, the percentage will be use to provide the

percentage of the samples and the percentage in each category that they will fall into based

on their results of financial literacy and financial behavior.

Formula:

𝑓
%= × 100
𝑛

Whereas,

f = frequency

n = total population

Mean - it is the quantity obtained by summing two or mo

re numbers or variables and then dividing by the number of numbers or variables. In the
study, the researchers will use the mean when they are categorizing the sum of the

responses of the respondents. Furthermore, the mean will be computed to itemize each

likert-item in the scale that will be used.

Formula:

∑𝑥
𝑥̅ =
𝑁

Whereas,

x= number of frequency

Σ= summation of x

N= total population

Standard Deviation – it is a measure that is used to quantify the amount of

variation or dispersion of a set of data values. In the study, it will be use to answer the

second and third statement of the problem of the study.

Weighted mean & standard deviation

The standard deviation is an indicator of how widely values in a group differ from the mean

(see StDev (standard deviation of a sample)). It is useful for comparing different sets of

values with a similar mean.

A weighted standard deviation allows you to apply a weight, or relative significance to

each value in a set of values. Values with a higher value for their weight are considered as

more significant to a sample as compared to the other values in a sample.

Expression:

Where:

wi: The weight of the its value. Values with a higher value for their weight are considered

as more significant to a sample as compared to the other values in a sample.

N’: The number of weights that are not equal to zero.

xw: The weighted mean of the values

Spearman

The Spearman’s Rank Correlation Coefficient is the non-parametric statistical measure

used to study the strength of association between the two ranked variables. This method is

applied to the ordinal set of numbers, which can be arranged in order, i.e. one after the

other so that ranks can be given to each. The data must be ordinal, interval or ratio.

Spearman’s returns a value from -1 to 1, where:

+1 = a perfect positive correlation between ranks

-1 = a perfect negative correlation between ranks

0 = no correlation between ranks.

Formula:
 RESULT AND DISCUSSION

This section presents the result of the study on the assessment of financial literacy

of salon and spa towards online banking on selected areas in Imus, Cavite. Specifically,

shows the profile of the participants and their business, assess their financial literacy, level

of understanding towards online banking and its effectiveness. And finally, the study

analysed the significant relationship between business owners’ assessment and budget

planning and control among sole proprietors in selected areas of Cavite

Demographic Profile of the Participants

Table 1 shows the demographic profile of the Salon and Spa in Imus, Cavite in

terms of years of operation and average annual income.

Years of Operation. The years of operation ranges from less than a year to 7 years

of operation. 64 percent of the participants are operating for 1 to 2 years, 16 percent of the

participants are operating 3 to 4 years, 6 percent are operating 5 to 6 years, 4 percent of the

participants are operating 7 years.

Table 1.

FREQUENCY PERCENTAGE
YEARS OF OPERATION
n =50 (%)
less than a year 5 10
1 to 2 years 32 64
3 to 4 years 8 16
5 to 6 years 3 6
7 years 2 4

Table 2. Distribution of Salon and Spa in Imus, Cavite according to Average Annual
Income
 AVERAGE ANNUAL FREQUENCY PERCENTAGE
INCOME n=50 (%)

50,000.00 -100001.00 8 16

100,000.00 -150001.00 8 16

150,000.00 -200001.00 7 14

200,000.00 -250001.00 5 10

250,000.00 -300001.00 5 10

300,000.00 -350001.00 5 10

350,000.00 -400001.00 2 4

400,000.00 and above 10 20

Average Annual Income.The average annual income of the participant ranges

from 50,000 and above. The result shows that a large proportion of the Salon and Spa in

Imus, Cavite, has an average annual income of 400,000 and above which constitute

20percent of the total respondents. Both average annual income which ranges from

50,000.00 to 100001.00 and 100,000.00 to 150001.00 constitute 16 percent of the total

respondents.

Table 3. Financial Literacy level

Frequency Percentage
Financial Literacy Score Range
n = 50 (%)

Failed below 70.00% 15 30

Passed 70.00 % to 73.32 % 10 20
Fair 73.33 % to 76.65% 0 0
Average 76.66% to 79.98 0 0
 Satisfactory 79.99% to 83.32% 0 0
Very Satisfactory 83.33% to 86.64% 7 14
Good 86.65% to 89.98% 0 0
Very Good 89.99% to 93.30% 0 0
Superior 93.31% to 96.63% 0 0
Excellent 96.64% and above 18 36

Financial Literacy. The table 3 shows the Financial Literacy scores of the salon and spa

on the selected area in Imus Cavite. It shows that 30% of the participants got the lowest

score of 15 which is below 70% from the range. Some of the salon and spa got passed

financial literacy with a 20% which is ranges from 70 percent to 73.32 percent. Very

satisfactory score with an equivalent range of 83.33% to 86.64%. Lastly, the remaining

18 of the participants got the 36 percent which range from 96.64 percent.

Table 4 Shows the assessment of the participants towards online banking.

FREQUENCY PERCENTAGE
n = 50 (%)
Yes 50 100.00
No 0 -

The table above shows that all the participants (100%) answered yes for having their online

banking account.

Table 5. Frequency and distribution of the participants of their reasons for having online

banking account.

FREQUENC PERCENTAG
Y E
SCORE POINTS (%)
 A. Convenience 30 28.85

B. Curiosity 17 16.35
C. Better Rates 25 24.04

D. Safe and secure 17 16.35

E. Low Service Charge 11 10.58

F. Easy to maintain my banking transaction in
activity 4 3.85

104 100.00

The table shows that 28.85 percent of the participants chose convenience for their reason

having internet/online banking account. Next to the highest, 17 participants of the study

are equal to 16.35 percent choses better rates safe and secure when it comes for their reason

having online banking account, while 11 of the participants which is 10.58 percent

answered low service of charge. The remaining 4 participants which is equal to 3.85

percent chose easy to maintain my banking transaction in activity.

Table 6. Frequency and distribution of the participants regarding to the online banking

services they often used.

FREQUENCY PERCENTAGE
SCORE POINTS (%)
A. Seeking product and rate information 11 9.82
B. Calculate loan payment information 7 6.25
C. Download loan application 9 8.04
D. Download personal bank transaction
activity 9 8.04
E. Check balances online 24 21.43
F. Apply for consumer loans or credit
cards online 12 10.71
G. Online bill payment 40 35.71
112 100.00
The table 6. Shows the participants preferences to different services of online banking.

Online bill payment got the highest point from the salon and spa with the percentage of

35.71, followed by the choice of checking balances online with the percentage of 21.43.

The 10.71 percent of the tally scores came from the participants choosing to apply for

consumer loans or credit, on the other hand, both download loan application and download

personal bank transaction activity got same score with a 8.04 percent. The remaining 6.25

percent from the total score came from the answer Calculate loan payment information.

Table 7. Frequency and distribution of the participants most important reason for

choosing this bank as your online bank

FREQUENCY PERCENTAGE
SCORE POINTS (%)
A. I have a
traditional bank
account with the
same bank 7 14.00
B. The brand name
of the bank 11 22.00
C. The excellent
service of this
bank 27 54.00
D. Advertisement 5 10.00
50 100.00

The table 7. Displays the participants preference to the most important reason for choosing

bank as their online banking. The third choice got the highest score with 54 percent for the

reason of the excellence service of banks. The choice for brand name of the bank got 22

percent from the participants. 14 percent of the total score came from the choice of I have

a traditional bank account with the same bank. While the least score with 10 percent chose

advertisement for their reason choosing this bank as online banking.

Table 8. frequency and distribution of the participants showing the assessment of the
participants through banks improvements

FREQUENCY PERCENTAGE
SCORE POINTS (%)
A. Differentiation

through lifestyle appeal

10 18.52
B. Monitoring internet

usage to ascertain

which features are

popular and liked

16 29.63
C. Better

communication through

easily dispersed and

answered email
28 51.85
54 100.00

The table 8. show participants opinion how banks can improve their relationship with

customers through the use of the internet. Half of the total score came from the answer

better communication through easily dispersed and answered email with 51.85 percent,

followed by the choice of monitoring internet usage to ascertain which features are popular

and liked with 29.63 percent.

Table 9. Weighted mean and standard deviation of the participants by showing customers
evaluation
WEIGHTE
D STANDARD VERBAL
MEAN DEVIATION INTERPRETATION
Visual
Appearance 3.460 0.5425 Better

Org. Layout 2.760 0.4764 Similar

Ease finding
info 2.660 0.6884 Similar

Simplicity 3.000 0.8571 Similar

Download
Speed 3.080 0.7516 Similar

Convenience 3.520 0.6141 Better

The table 9. Shows participants evaluation towards online banking. visual appearance and

convenience from the choices got better verbal interpretation. While the remaining 4

choices got the similar verbal interpretation.

Table 10. Frequency and distribution of the participants in important factors

FREQUENCY PERCENTAGE
SCORE POINTS (%)
A. Entertainment 10 10.99
B. Ease to use 35 38.46
C. Privacy
protection 22 24.18
D. Opportunities for
interaction 6 6.59
E. Easy navigation 12 13.19
F. Up to date
information 6 6.593406593
91

The table 10 displays participants opinion regarding to the most important factors for an

effective website. The choice of ease to use got the highest percentage with 38.46, followed
by privacy protection with 24.18 percent. Easy navigation got 13.19 percent while

entertainment got 10.99 percent. Both opportunities for interaction and up to date

information got the same and least score of 6.59 percent.

Table 11. Frequency and distribution of the participants of bank’s importance having
website
FREQUENCY PERCENTAGE
SCORE POINTS (%)
A. It gives the bank a competitive advantage
17 22.67
B. Customization
12 16.00
C. Many bank users are internet users
13 17.33
D. It is just a matter of time
9 12.00
E. More complete information and comparative

information
24 32.00
75

The table 11. shows participants reasoning why banks need to have a website. The first and

highest choice is more complete information and comparative information with 32 percent,

followed by 22.67 percent which it gives the bank a competitive advantage. While the

remaining answers of many bank users are internet users, customization and it is just a

matter of time are having a close rate with 17.33, 16 and 12 percent, respectively.
Table 12. Frequency and distribution of the participants

FREQUENCY PERCENTAGE
SCORE POINTS (%)
A. Newsletter, news flashers and new product or

service announcement
9 15.00
B. Customer service responses
10 16.67
C. Change of service notification, change of prices

of services
13 21.67
D. Orders, accounts, payments of bills notifications

etc.
28 46.67
60

The table 12. displays participants answers the inclusion with regards in receiving e-mail.

Almost half of the total score came from the answer orders, accounts, payments of bill

notification with 46.67 percent. Next one is choice of change of service notification, change

of prices of services with the 21.67 percent. Customer service responses got the score of

16.67. The remaining 15 percent of the participants came from Newsletter, news flashers

and new product or service announcement.

Table13. Frequency and percentage of the participants

FREQUENCY PERCENTAGE
SCORE POINTS (%)
A. Yes 6 12.00
B. No 44 88.00
50
The table 13 displays participants answer to the question of poor website is the reason to

move to another bank. 88 percent of the participants answered no. while the remaining 12

percent answered yes.

Table14. Frequency and percentage of the participants

FREQUENCY PERCENTAGE
SCORE POINTS (%)
A. Convenience
26 28.57
B. Empowerment (to carry out banking

transaction w/out asking any help of bank

staff and visiting branch)

14 15.38
C. Better service
18 19.78
D. Lower cost and better rates
14 15.38
72

The table 14 shows the benefits they get from the internet in terms of banking service. Most

of the participants chose convenience of the banks with 28.57 percent, followed by better

service with the rate of 19.78 percent. Both, empowerment (to carry out banking

transaction w/out asking any help of bank staff and visiting branch) and lower cost and

better rates got same rate of 15.38 percent.

Table15. Frequency and percentage of the participants
FREQUENCY PERCENTAGE
SCORE POINTS (%)
A. Reduced barriers to entry
9 9.89
B. Personalize/customize
8 8.79
C. Target ability
10 10.99
D. Global reach
29 31.87
E. Tracking, market research and

information collection
18 19.78
74

The table 15. shows participants preferences the factors about what makes internet a good

marketing communication tool. Global reach got the highest rate of 31.87. Followed by the

choice of tracking, market research and information collection with 19.78. the last three

choices which are target ability, reduced barriers to entry and personalize/customize got a

close rate to each other with the rate of 10.99, 9.89 and 8.79, respectively.
Factors influencing the adoption of online banking

Internal Aspects.Table 16 shows the internal aspects influencing the adaptation of

online banking study. The computed average is 3.51 and the standard deviation is 0.7948.

It shows that participants have agreed that online banking is easy to use, the reputation,

compatibility, its past performance, clear objectives and cheaper cost are considered factor

that influence the adaptation of online banking with a weighted mean of 3.72, 3.56, 3.80,

3.56, 3.42, 3.42 and 3.71 (SD = 0.7835, 0.7602, 0.8081and 0.7866) respectively. The 3.71

Come from the other factors that is specified by the participants such as bank, location,

banks performance and accuracy.

On the other hand, the participants have neither agreed nor disagree on the factors

of online banking as a sing of modernity, its employees and brand image can influence the

adaptation of online banking.

Table 16. Internal factors influencing the adoption of online banking

WEIGHTED STANDARD VERBAL

MEAN DEVIATION INTERPRETATION
Using online banking is a Neither Agree or
sign of modernity 3.34 0.6263 Disagree
Online banking is easy to
use 3.72 0.7835 Agree
Reputation of the banks 3.56 0.7602 Agree
Online banking is
compatible with my
lifestyle 3.80 0.8081 Agree
Past performance of the
banks 3.56 0.7866 Agree
The behavior of
employees instill Neither Agree or
confidence you 3.36 1.1386 Disagree
The bank has clear
objectives to satisfy
customers 3.42 0.8827 Agree
The image of the brand is Neither Agree or
appealing to you 3.22 0.8640 Disagree
 Online banking is cheaper
way to conduct banking 3.42 0.8104 Agree
Others 3.71 0.4880 Agree
AVERAGE 3.51 0.7948 Agree
Legends:
1.00 - 1.79 = Strongly Disagree
1.80 - 2.59 = Disagree
2.60 - 3.39 = Neither Agree or Disagree
3.40 - 4.19 = Agree
4.20 - 5.00 = Strongly Agree

Table 17. External factors influencing the adoption of online banking

WEIGHTED STANDARD VERBAL

MEAN DEVIATION INTERPRETATION
Neither Agree or
L1. Family member opinions 3.16 0.6809 Disagree
Neither Agree or
L2. Friend recommendations 3.20 0.9035 Disagree
L3. Influenced by popular person 3.58 0.8593 Agree
L4. Information obtained from the
internet
3.52 0.9528 Agree
L5. Affordable service
3.72 0.9044 Agree
L6. Television advertisement 3.68 0.9134 Agree
L7. Radio broadcasting 3.54 0.7879 Agree
L8. Article in newspaper 3.58 1.0319 Agree
L9. OTHERS: Please specify
____________ 4.17 0.4082 Agree
AVERAGE 3.57 0.8269 Agree
Legends:
1.00 - 1.79 = Strongly
Disagree
1.80 - 2.59 = Disagree
2.60 - 3.39 = Neither Agree or Disagree
3.40 - 4.19 = Agree
4.20 - 5.00 = Strongly
Agree
 External Aspects Table 17 shows the external aspects influencing the adaptation of

online banking study. The computed average is 3.57 and the standard deviation is 0.2689.

It shows that participants have agreed that online banking is easy to use, the reputation,

compatibility, its past performance, clear objectives and cheaper cost are considered factor

that influence the adaptation of online banking with a weighted mean of 3.72, 3.56, 3.80,

3.56, 3.42, 3.42 and 3.71 (SD = 0.7835, 0.7602, 0.8081and 0.7866) respectively. The 4.17

who agreed to the other factors such as it is their fashion, banks location etc.

On the other hand, the participants have neither agreed nor disagree on the factors

of online banking as a sing of modernity, its employees and brand image can influence the

adaptation of online banking.

Table 18. Advantages using online banking

WEIGHTED STANDARD VERBAL

MEAN DEVIATION INTERPRETATION
L1. Less costly 3.64 0.6627 Agree
L2. Online banking prevents any
harm 3.78 0.6788 Agree
L3. Anytime banking and anywhere
banking 4.04 0.7814 Agree
L4. Reduction in cost of transaction 3.84 0.8418 Agree
L5. Pay bills online by saving postal
service 4.12 0.6893 Agree
L6. Easy to make utility payment 3.72 0.8340 Agree
L7. Online purchase/ transaction 4.06 0.6518 Agree
L8. Service is available 24/7 4.02 0.7951 Agree
L9. Transfer funds 4.08 0.8533 Agree
L10. Time availability for different
services 4.22 0.7900 Strongly Agree
AVERAGE 3.95 0.7578 Agree
Legends:
1.00 - 1.79 = Strongly
Disagree
1.80 - 2.59 = Disagree
 2.60 - 3.39 = Neither Agree or Disagree
3.40 - 4.19 = Agree
4.20 - 5.00 = Strongly
Agree

Table 18 shows the participants assessment through the advantages of using online

banking. The computed average is 3.95 and the standard deviation is 0.7578. It shows that

participants have agreed that the advantages of using online banking is as follows Less

costly, Online banking prevents any harm, Anytime banking and anywhere banking,

Reduction in cost of transaction, Pay bills online by saving postal service, Easy to make

utility payment, Online purchase/Transaction, Service is available 24/7 and Transfer funds

with a weighted mean 3.64, 3.78, 4.04, 3.84, 4.12, 3.72, 4.06, 4.02 and 4.08 (SD = 0.6627,

0.6788, 0.7814, 0.8418, 0.6893, 0.8340, 0.6518, 0.7951 and 0.8533)respectively. While the

remaining advantage, Time availability for different services which has 4.22 Weighted

mean and 0.7900 Standard deviation.

Table 19. Perceived effect using online banking _.

STANDARD VERBAL
WEIGHTE DEVIATIO INTERPRETATIO
D MEAN N N
L1. Fast checking account
information and balance
inquiry 3.94 0.7669 Very Effective
L2. No time needed when
paying bills 3.78 0.8154 Very Effective
L3. Online banking saves time
and costs both 3.90 0.8144 Very Effective
L4. Faster log in facility 3.48 0.9089 Very Effective
L5. Quick Transfer of Funds 3.94 0.7117 Very Effective
L6. Problem solving through
instant information 3.54 1.0144 Very Effective
 L7. Affordable services 3.54 0.7616 Very Effective
L8. Fast Electronic Bills
payments 3.60 1.1429 Very Effective
L9. Protection of banking
transactions 3.88 0.9823 Very Effective
L10. User friendly system 4.26 0.8992 Extremely Effective
AVERAGE 3.79 0.8818 Very Effective
Legends:
1.00 - 1.79 = Not at
all
1.80 - 2.59 =
Slightly Effective
2.60 - 3.39 = Moderately Effective
3.40 - 4.19 = Very
Effective
4.20 - 5.00 =
Extreme Effective

shows the perceived effect by the participants using online banking. The computed average

is 3.79 and the standard deviation is 0.8818. It shows that participants have agreed that

online banking that majority of perceived effect as Fast checking account information and

balance inquiry, No time needed when paying bills, Online banking saves time and costs both,

Faster log in facility, Quick Transfer of Funds, Problem solving through instant

information, Affordable services, Fast Electronic Bills payments and Protection of banking

transactions are considered very effective when accessing online banking with a weighted

mean of 3.94, 3.78, 3.90, 3.48, 3.94, 3.54, 3.54, 3.60 and 3.88 (SD = 0.7669, 0.8154,

0.8144, 0.9089, 0.7117, 0.0144, 0.07616, 1.1429 and 0.9823)respectively. While the user

friendly factor got weighted mean of 4.26 with the standard deviation of 0.8992.
Table 20. Significant relationship between financial literacy and the perceived effect

by the participants.

Correlation P-
Coefficient value Verbal Interpretation Decision
Very weak Positive Not
Effectiveness 0.189 0.189 Correlation Significant

Table 20 shows the result of the correlation analysis between financial literacy and the

perceived effect on online banking. A Spearman test shows that there is not enough

evidence to reject the null hypothesis. Rather, the study suggests to accept the null

hypothesis that there is no significant relationship between financial literacy and perceived

effect using online banking. Regardless of their level of financial literacy is not correlated

to their perception between the effectiveness of online banking system. According to the

Study of Financial Literacy and Its Impact on Customer Satisfaction (2016) in this study a

set of research questions were asked to the respondents to identify the impact of financial

literacy on customer satisfaction towards banking services. It was found that level of

financial literacy was low among the respondents and there is no significant impact of

financial literacy on overall customer satisfaction and effectiveness.

Table 21. Significant Relationship between financial literacy level and perceived

advantage using online banking

Correlation P-
Coefficient value Verbal Interpretation Decision
Perceive Very weak Positive Not
advantage 0.246 0.085 Correlation Significant

Table 21 shows the result of the correlation analysis between financial literacy and the

perceived advantage to engage on online banking. A Spearman test shows that there is not

enough evidence to reject the null hypothesis. Rather, the study suggests accepting the null

hypothesis that there is no significant relationship between financial literacy and perceived

advantage using online banking. Regardless of their level of financial literacy is not

correlated to their perception on their assessment in the different advantages of online

banking. According
 SUMMARY, CONCLUSION AND RECOMMENDATIONS

This chapter contains of the summary and brief findings of the study. It also

includes the researcher’s point of view in the result of the study through conclusions and

recommendations.

Summary

This study was conducted for the purpose of determining the level of Financial

Literacy and Financial Behavior of the students. Specifically, it sought to answer the

following objectives: (1) determine the profile of the participants in terms of; (2) assess the

financial literacy of the participants. (3) to determine the level of understanding on online

banking system (4) to know the factors affecting the adoption of online banking (5) to

enumerate the advantages using online banking (6) to know their assessment using online

banking (7) to know if there is any significant relationship between level of understanding

on online banking system and evaluation of online banking system. (8) to know if there is

any significant relationship between financial literacy and evaluation of online banking

system.

According, to the data gathered, only 36 percent of the participants got the highest

rate in financial literacy level, 14 percent from the participants who are very satisfactory,

20 percent who passed and the remaining 30 percent got failed in regards with financial

literacy. On the other hand, the participants assessment on online banking is good.
Participants are well knowledgeable when it comes to online banking, also, participants

evaluate the better convenience for using banks services. Advantages, as one of the features

of online baking, participants rate the time availability for different services of online bank

as the highest one. While the perceived effect, participants chose the user friendly system

of banks services as extremely effective with the weighted mean of 4.26.

In relation between to the Financial literacy level and perceived effects using online

banking by the participants, the result appeared that there is no significant relationship

between the two with the correlation coefficient of 0.189

The Spearman’s Rank Correlation Coefficient is the non-parametric statistical

measure used to study the strength of association between the two ranked variables.

The study also showed that there is no significant relationship between financial

literacy level and the advantages in online banking by the participants with a correlation

coefficient of 0.246

Conclusion

From the findings of this study, a conclusion can be drawn that registered salon and

spa in Imus Cavite were knowledgeable and financially literate when it comes to their

operation. According to Forbes financial council (2017), every business owner should

make financial literacy a priority in their continuing education. Also, they stated that

owners don't have to earn a finance degree or pass a CPA exam, though. They just need to

build a solid knowledge base about business finances, so you can easily communicate with

and understand your accountant and/or financial advisor. The level of understanding
towards online banking is not just like knowing the simple definition and some features, it

also about how to use online banking the smartest way. According (Answer,2019) Users

of online banking should know and understand online banking for them to keep track of

their finances as well as make transactions from the comfort of their home.

Recommendation

Based on the findings of the study, it was found out that almost 70 percent of the

participants passed for being financial literate. According International Getaway for

financial education (2013) most of the students have successfully passed the financial

literacy test (over 70% of correct answers). Thus, the researcher suggests that owners

should practice being financially literate for the benefit of their company. According

Georgia’s own credit union (2018) basic financial literacy helps people become self-

sufficient and achieve financial stability. Also, they need to apply their knowledge when

acquiring and using online banking. Owners and managers. should provide trainings for

the managers to practice their skills and attitudes when it comes to managing their money.

This study will involve banks performance. It will help them to improve and

enhance their other services which got lowest rate. Bank’s also needing to widen their

research in related to their traditional operation. On the other hand, customer might find

this study helpful to add up their knowledge when adopting and using online banking. Also,

they can explore different banks services.

Teaching Professional can use this study as their reference regarding to the financial

literacy that will be useful for the future owner, manager etc. According (Hadar 2015) The
premises of this paper is that the Financial literacy educators is an important factor in

narrowing the socio-economic gap. The financial education should start at school.

LGU who holds service type of business should give and create some seminars,

specifically, money management with the use of online banking. Lastly, for the future

researcher, they can use this study in related to their research. They can also apply to

themselves the said practices for them to be proficient managing money and other finances

with the use of online banking.