“A STUDY ON IMPACT OF E-BANKING IN KARNATAKA

BANK LIMITED, WITH SPECIAL REFERRENCE TO

BELTHANGADI, NERYA”

DISSERTTION SUBMITTED IN PARTIAL FULLFILLMENT OF THE

REQUIREMENT FOR THE AWARD OF

MASTER BUSINESS ADMINISTRATION

SUBMITTED BY

SALAMAN KHAN A

REG.NO: 20202MBA0236

UNDER THE GUIDANCE OF

DR SAGAR MANJUNATH

ASSISTANT PROFESSOR

SCHOOL OF MANAGEMENT

PRESIDENCY UNIVERSITY

2020-2022
ACKNOWLEDGEMENT

The project titled ““A STUDY ON IMPACT OF E-BANKING IN

KARNATAKA BANK LIMITED, WITH SPECIAL REFERRENCE TO
BELTHANGADI, NERYA” has been a good learning experience.

I wish to extend my thanks to Dr. AKHILA R UDUPA, HOD of Presidency

University, who has extended support in completion of this project.

I thank DR SAGAR MANJUNATH Assistant Professor, School of Management,

Pos for their contribution, guidance and suggestions throughout the duration of the
project.

I extend my sincere gratitude to my guide DR SAGAR MANJUNATH for

providing guidance & valuable ideas which helped me to complete this project
successfully.

I also thank all the respected faculty members of Department of School of

Management, PRESIDENCY UNIVERSITY for their cooperation and assistance
given to me in this work.

Finally, I am grateful to my parents, friends and well – wishers, who have in some
way contributed to the completion of this project.
 DECLARATION BY THE STUDENT

I, Mr. SALMAN KHAN A bearing Reg. No. 20202MBA0236 hereby declare that
this project entitled “A STUDY ON IMPACT OF E-BANKING IN
KARNATAKA BANK LIMITED, WITH SPECIAL REFERRENCE
TO BELTHANGADI, NERYA” has been prepared by me towards the partial
fulfilment of the requirement for the award of the Master of Business Administration
(MBA) Degree of PRESIDENCY UNIVERSITY under the guidance of DR SAGAR
MANJUNATH.

I also declare that this project is my original work and has not been previously
formed the basis for the award of any degree, diploma, associate-ship, fellowship
or other similar titles of any other university.

Date:

Place: BANGALORE SALMAN KHAN A

Reg. No. 20202MBA0236

 CERTIFICATE BY THE GUIDE

Date:

This is to certify that the dissertation “A STUDY ON IMPACT OF E-

BANKING IN KARNATAKA BANK LIMITED, WITH SPECIAL
REFERRENCE TO BELTHANGADI, NERYA” is an original work
of Mr. SALMAN KHAN A bearing University Register Number
20202MBA0236 and is being submitted in partial fulfilment for the
award of the master’s degree in Business Administration of Presidency
University. The report has not been submitted earlier either to this
University /Institution for the fulfilment of the requirement of a course of
study. Mr SALMAN KHAN A is guided by Dr SAGAR
MANJUNATH who is the Faculty Guide as per the regulations of
Presidency University. Signature of Faculty Guide Signature of Director
/Principal /HOD
CONTENTS

CHAPTER PAGE
TITLE
NO.

Chapter 1 INTRODUCTION 06-27

Chapter 2 LITREATURE REVIEW AND 28-34

Chapter 3 RESEARCH METHODOLOGY 35-38

DATA ANALYSIS AND

Chapter 4 39-76
INTERPRETATION

FINDINGS

Chapter 5 SUGGESTIONS 77-81

CONCLUSION

BIBLIOGRAPHY 82

ANNEXURE 83-87
CHAPTER 1

INTRODUCTION, INDUSTRY PROFILE, COMPANY PROFILE

Introduction

The study made on a particular topic to understand that concept is called as project
work. In other words, project can be a work done by an individual as a part of planned
work which has a specific purpose which usually takes a lot of time for the
completion of task. In MBA programs, the project is important in completion of
course. It helps the student to understand the corporate world along with working on a
specific problem which company faces in real life. It provides the best knowledge to
students to understand the real-life problem and help them to implement the
theoretical knowledge they learn through concepts. It also provides experience to the
student to understand the concept practically.

This study is made for six weeks in a company where the students are asked to utilize
the opportunity of working in a company and do the project work there. The study
helps the students to build their career in a better manner. The project work done by
student helps in receiving the experience of service between service and the
organisation.

The reason behind the study was to know the knowledge about E-banking to the
customer belonging to this particular region and the benefits which are employees are
enjoying. And also this study includes is there any growth in the economy after
digitalization.

To satisfy the objective mentioned in this study I have used the important test to prove
the objective. Here I have taken T test, Z test and correlation analysis has been done to
know the relationship between variables and GDP of the country.

Using the above test all the objectives has been satisfied and further analysis is done
for the future growth of the company. Study has also revealed that there is lot of
impact on customers as well as employees.
Industry Profile

Indian Banking sector has got high importance now a days and it is termed as one of
the competitor. Money lending is oldest professions in India and it has a history of
about more than two hundred years. In the year 1960s it has spread its importance and
become an important way for the development of an Indian economy. General bank of
India was built and it came into existence in 1786 and after that Bank of Hindustan
was established. By the year 1900s, the market was expanded. And then many other
banks were established. In the year 1935 RBI took over the responsibilities of the
banking sector/industry.

In the year 1948, the RBI was nationalised which was headed by the government of
India. Banking regulation Act was passed in the year 1949, which gave power to RBI
to inspect and control the other banks of India. This Act also stated that no new bank
or branches of an existing bank opened without the permission of RBI and there has to
be license from the RBI to each and every bank. And also it clearly mentioned that
same directors cannot handle 2 banks or more than that. As per RBI, India’s banking
industry/sector has sufficient capital and it is well regulated.

By the year 1960 the Indian banking industry has got high importance and became a
tool to develop an Indian economy and for the growth of the country, modern bank
and its branches also came into force. With industrial revolution, there were improved
business and industrial units, thus lots of joint stock of company came into existence.
All these factors created importance to build financial institution that is bank, which
collects the amount from the people on terms deposits and they can withdraw the
amount when necessary.

Market size of the industry

Indian banking sector/industry have 20 public sector banks, 22 private sector banks,
44 foreign banks, 44 regional rural banks, 1542 urban co-operative banks &
94384 rural co-operative banks in addition to co-operative credit institutions.
As on January 31, 2020 the total number of ATMs in India increased to 210263 & it is
expected to increase to 107000 by 2021. Public sector banks’ assets were at Rs 72.59
Lakh crore in financial year 2019. During financial year 2016-2020, credit off take
increased at a CAGR of 13.93%.
During financial year 2016-2020, deposits were increased at a CAGR of 6.81% and
reached 139.32 trillion by the financial year 2020. Credit to non fund
businesses/industries increased to 3.3% y-o-y, reaching 92.39 trillion by the financial
year 2020 on February 28, 2020 & 104.12 trillion on March 13, 2020.

Major players in the Indian Banking Industry

Indian Banking Industry’s has got high reach over the years and its growth has been
more qualitative than quantitative and it is going to expand for the upcoming years
and it is planned to remain the same for the future.

Some of the important players/competitors in the Indian banking industry are the
Bank of Baroda, State Bank of India, Mahendra bank, Citi bank etc…

Company profile
Bank is one of the forms or the other was in existence from last few decades or from
ancient times. After the industrial revolution all these facilities came into force and
have gained its importance over the years. After the industrial revolution, there were
increase in size of business as well as industries, thus joint stock company came into
existence and it has generated lot of revenue to the banking industry.

Karnataka bank limited a private owned bank and it is considered to be 12th largest
and ‘A’ class scheduled commercial bank among India. KBL based in Mangalore in
Karnataka, India. It’s headquarter located at Mangalore. KBL has built its network
among 862 branches with total 8509 employees working in this particular bank. It
consists of 1026 ATMs with all the proper settings and 454 e-lobbies and mini e-
lobbies across India. 12 million and more customers all over the country are receiving
services. All the shares belonging to KBL are owned by 146000 shareholders .It says
that customers are important to them and KBL states that ‘Your Family Bank
across India’.

KBL was established in 18th February 1924 and started its business on 23rd May
1924. The founder of the bank established the bank in Mangalore, one of the coastal
areas in Dakshina Kannada district, Karnataka. It was created by B.R. Vysaray Achar
to serve the South Canara region.

Later it merged with Chitladurg bank, Sringeri Sharada bank and Bank of Karnataka
for long years. The bank has special branches for finance, forex and industry and
agriculture finance business and for other important purposes. In 1966 KBL took the
Bank of Karnataka. In 1946 Bank of Karnataka was founded and at this time Bank of
Karnataka had 13 branches after this acquisition.

Over the years it has tried to adopt Core Banking, Internet Banking and established its
‘Money Plant’ (ATM) system all over India, later it adopted all those E-banking
technology. KBL has 12 regional offices, customer care centre, 2 central processing
centres and 6 asset recovery management branches and a digital centre, 3 currency
chests, 4 service branches and an international division a data centre.

In the year 1995, October bank entered into the stock market with the public issue of
Rs. 81crores. It was oversubscribed about 2.5 times even though there were
depressions in the market. In the year 2003, the bank has taken up several corporate
agencies for marketing different insurance companies. The bank’s overall excellence
measured in different parameters which is necessary for any banking industry. And
later it has earned ‘P1+’ rating from CRISIL for the achievement of the bank.

In the year 2000, KBL signed a MOU with Infosys Technologies in order to develop a
core banking solution called Finacle. Main motive/goal of this plan is
to create banking facilities globally anywhere and everywhere at anytime.
During 2004, the bank took up its first step towards digital banking and founded
the MoneyPlant that is a kind of debit card. And it states that it helps customers can
withdraw money from their various Karnataka bank A/c at any place.

Many of us trust that the term banking means lending of money. And the banker is not
the one but he is a important lender of money may be in terms of loans, withdrawals
or deposits. Banking is not lending of money as he does not take the risk of lending
whereas the bank as well as banker will take the highest risk.

Bank has given high importance to Mobile banking/Internet banking which also
includes on boarding, enabling of Digi-Locker and green pin features Mailkoot
services is bulk E-mail facility is enforced for digital marketing.

The main business of any bank includes loans and deposits. Karnataka Bank products
and services include deposits, borrowing facility, providing return on funds and
helping with overseas transactions.
Achievements/Awards:

• KBL receives I.B.A Banking Technology Awards 2011.

• Bags two I.B.A Awards.
• It launches Current and Saving A/c campaign.
• KBL introduces revised Kisan Credit card scheme for Farmers.
• Bags IBA Banking Technology Award 2012-13
• KBL-Best Banker Awards Social Banking Excellence Award 2013
• Second Runner up under Best Financial Inclusion Initiative 2013
• Second Runner up under Best risk Management and Facility Initiative 2013
• Banking Financial Services and Insurance(BFSI) BEST BANK AWARD 2013
• Best MSME offering inder Private sector category in ASSOCHAM 7th National
MSMEs Excellence Awards 2019-20
• Third Best performed bank Award at National level under Old Private sector Bank
category for the year 2018-19, instituted by State Forum of Banker’s Clubs,
Kerala
• ET Business Excellence Award 2019, in the category ‘Excellence in Banking
service’
• STP Award 2018: In recognition of Bank’s outstanding payment formatting and
straight-through rates, instituted by Bank of New York
• Bank bags Atal Pension Yojana ‘Game Changers’ award instituted by PFRDA
• ‘Bank with best technology orientation’ and ‘Best corporate social responsibility
Practices’ awards instituted by ET NOW.
• Award in Attal Pension Yojana ‘Winners of Winning Wednesday’ campaign
under RO category
• Best performing Bank Award in the Atal Pension Yojana ‘People First’ campaign
at Tamilnadu for 100% Branch Activation of APY Scheme, conducted by PFRDA
• ‘Best Financial Services and Foreign Exchange Earner in Southern Region’ award
for the year 2016-17
• ‘Sanman Patra’ by the Central Excise & Service Tax Commissionerate,
Mangaluru for compliance to service tax provision 2016 .
IBA Banking Technology Awards 2016 ‘Best Risk and fraud Management Initiative –
Runner up’ (Small Bank category)
• ISO 27001:2013 certificate from UKAS, Management systems, a UK based
accreditation certifying body 2015

Vision, Mission & Quality Policy

• Vision
Bank is the institution and banker is one of the professions where customer loyalties
are managed and consistent profitability will be managed by the particular bank. It has
to face the challenges and meet its objectives successfully in vision by the
management of the company. Adopting ethics, different management practices and
managerial implications towards fulfilling national and other important priorities.
Bank has to maintain financial and other important factors above all to improve and
innovate to meet the new challenges.

Karnataka bank limited vision is very clear to their customers is that, their vision is to
be a progressive, prosperous and well governed bank.

‘VISION-2020’ is an aspirational journey to emerge as a big, strong and vibrant bank.

Bank has embarked upon a transformational journey and tried to reach a total turnover
of Rs 180000 crore with the CD ratio of 80% by 2020 and to expand the customer
base to 13 million from the present 8.2 million. To give further boost to this, the bank
has organised a management workshop recently and board also had a special one day
strategy meet. Accordingly, this initiative will be taken forward so as to make bank a
force to reckon with in the days to come.

• Mission

All types of industries usually represent the long term goals and short term goals,
objectives and strategies to meet all of the above in the near future. Mission is very
important to all organisations, so that it could do their work according to their mission
and fulfils their goals as soon as possible. Mission statement also explains the need
and importance of any organisation.
Mission of KBL stands as “To adopt the new technology, gives high importance to
their customers with showing a global presence, driven by the highest standards of
corporate governance and guided by sound ethical values”.

• Quality Policy

Karnataka bank limited showed its interest towards providing quick service and better
as well as best service to the customer belonging to the particular bank and achieving
customer satisfaction through above policy.

Bank will ensure that products or services sold or offered on voluntary or daily basis.
It gives huge number of facilities to their customers in terms attractive interest rates,
secured payments etc… Further, products that are unsuitable to the customers will not
be sold and customers will not be forced to avail the products.

They also provides customer right policy which includes, right to fair treatment,
transparency, suitability, fair and honest dealing, privacy, grievance redress and
compensation, review policy etc.

Product & Service Profile

Services

• POS(Point of Sale) services by KBL

POS is place at where customer makes a payment to the particular merchant in
exchange of goods. It saves time and faster processing of payments.

• KBL Apna ghar

It came into force in November 2001, it’s a kind of housing finance scheme. Under
this scheme certain amount of loan are to be sanctioned for the construction of new
house.

• Missed call banking

Customer can know their account balance by giving a missed call from their registered
mobile numbers to the designated toll free numbers.
• KBL udyog mithra
Loan is provided for the purchase of medical
tools and equipment/ computers/machineries, renovating the office.

KBL car finance

Here loan was provided for the purchase of vehicles especially for four wheelers.
Certain amount of loan can be provided to a person after checking invoice or
necessary documents.

KBL krishik sarathi scheme

This scheme was mainly developed for the purchase of farm machineries. For
example tractor which is highly used in the farm and some other important tools
which are helpful to do the farm work.

Mobile and net banking

It has KBL mobile banking app which makes banking easier and net banking facility
namely MoneyClick featured by Karnataka bank helps to manage finance and
transaction in the comfort of both home and office.

• NRI services
There are deposit scheme arranged for several Non Resident Indians (NRIs). It
includes NR Rupee A/c, foreign currency NR scheme, and NR ordinary A/c with very
attractive rates.

• Education loan scheme

It is introduced to give financial support to the students who want to continue their
education in India or abroad. The maximum amount provided per student who
continues his/her study in India is Rs. 75 Lakh and students who will study in abroad
he/she can claim Rs. 1.50 Lakh.
KBL easy ride

It was introduced for the purchase of two wheeler of popular brands like Bajaj, TVS
and Kinetic etc.

• Kisan Seva Kendras

It is the scheme which helped to provide important products in doorsteps of all

agriculturist, this scheme was passed by the bank. So as to build Pumps which is
beneficial to agriculturist belonging to rural areas at cheaper rate.

Products

• Retail Banking
It is also termed as consumer banking. It is a kind of services provided by the
particular bank to the public.

• Corporate /Wholesale banking

It is a service provided by the banks to their customers and organisation such as

mortgage brokers, insured customers, entrepreneurs etc…

• Credit Card
Issued by financial institution, which gives a pre-set credit limit which a person can
use to pay for his purchase without having to pay in cash or issuing a cheque.

• Banc assurance:
The selling life assurance and other insurance products and services by Karnataka
bank.

Deposit Products
Karnataka bank limited planning to help their customers to build a strong relationship
by improving returns and investments in various stocks, bonds or any other funds and
increasing their assets that is by improving their loan structure.

• Abyudaya cash certificate

It is a scheme which helps in growth of the economy. It gives highest returns to the
people. Amount invested in the particular scheme would be multiple after the maturity
or particular period.

Fixed deposits
This is done for a specified period of time. It can be from 15 days to 10 years and
interest amount can be paid with the convenience of the customer.

• Ready Money Deposits

This is a kind of deposit A/c as well as an overdraft A/c. Where minimum deposit of
Rs 10000/- and it has feature of withdrawing amount or cash through cheque when
there is necessary. There is no need of presenting deposit receipt in front of the
banker.

• Soulabya Deposit
It is a scheme which is also termed as ‘Twin gain’. It also provides withdrawal facility
to customer if any urgency.

• Cumulative Deposits
It is a scheme where cash deposits are done on monthly basis. Here amounts are fixed
and it has to be deposited monthly and also durations are fixed within the maturity all
the dues have to be settled.

• Insurance linked savings Bank deposit

Here people have to maintain enough balance in his A/c and in case he met with an
accident he can get insurance coverage and claim the amount. A nd also he shoul
provided needed documents to the bank.

• K-Flexi Deposit

This scheme increases the returns on surplus funds in the bank A/c. Fixed amount at
this level is 10000/- and person has to maintain certain amount in his A/c and if the
amount exceeds the limit then those are transferred to term deposit A/c

• Resident foreign currency A/c

This A/c opened as a Current A/c and foreign currencies like YEN and EUROs are to
be deposited here. All these a/c doesn’t carry any interest along with the deposit and it
has no particular amount is fixed to open the A/c.

Swarojgar Credit Card scheme (SCC)

It helps in giving credit in time that is capital which is used for day to day purposes.
Like fisherman, rickshaw owners needs these kinds of credit to meet their daily
purpose or needs

It includes Issue of Credit, which acts as a identity to each customer and facilitates
record the each and every transaction .

Future growth and prospects

Karnataka bank’s focus will be on expanding the retail which will provide about 70%
of advances by the end of financial year. Bank will maintain priority sector advances
well above mandatory level of 40% and endeavour to surpass agricultural credit of
minimum 18% throughout the vision period.

Karnataka bank ltd has set a business plan for the next five years and adopted a vision
statement that more progressive, prosperous and well governed bank. The plan
reflects aspiration of all stakeholders and bank has adopted bottom up approach in
preparing this ambitious document. For achieving projection in the document, bank
will take advantage of expanding opportunities, upgrade its IT Infrastructure and
strengthen its audit and many other factors as well.

It will also improve the products and services simultaneously by the implementation
of new strategies to expand value of the organisation to their authority properly.
In this process, bank customers will continue to be focal point of all the initiatives and
bank will endeavour to introduce more and more innovative products and service
offerings on an ongoing basis to deliver value to customers and maximize customer
satisfaction.
Karnataka bank future growth results includes, Rights Issue at 1:2, June quarter net
jumps 68%, targets Rs 6800 crore farm credit, covid-19 pandemic: growth lesson for
states from Gujarat and Karnataka, Cos take a rights turn to turn to weather market, on
road from good to great, RBI brings good tidings for the borrowers.
SWOT Analysis

Strengths

• Over 862 branches are located all over India among them 20 states and 2 Union
territories
• High importance is given on customer satisfaction
• Bank has total 8509 employees and 12 million and more customer. Also includes
farmers and villagers throughout the country
• Quick transfer facilities are given by the bank.
• The bank has educated employees and employers. This will help the other
inexperienced employees to get knowledge from the authorities.
• Management capabilities, focused strategy and speedy decision making.
• Giving high importance to Mobile Banking
• Gives good infrastructural facility to its employees which improve their interest
towards their work.

Weakness

• Stocks pledged to the banks are not properly insured

• One of the private sector bank
• This customer belonging to this bank are not adopting technology
• There are some cases where there are continuous returns of cheques and the
branches had not shown interest over the matter.

Opportunities

• NPAs are reduced in recent results

• This bank enjoys high level of autonomy. Which helps them for faster decision
making as it is a private sector bank
• To face competition, they can innovate new products and services, thus bank can
achieve high customer satisfaction
• With computerization bank can offer cost-effective services which are convenient
to the customers.
• Most branches of KBL are located in the South region of the country.
Threats

• Highly competitive Environment

• Economic slowdown
• Increase in provisions in recent results
• Competitors are Yes bank, SBI, Citi bank etc

Particulars March March

2020 2019

Capital and Liabilities:

Share capital 310.88 281.99
Equity share capital 310.88 282.62
Reserves 5189.50 5090.44
Net Worth 5500.38 5373.06
Deposits 71785.15 68452.12
Borrowings 4065.12 3325.51
Total debt 75850.27 71777.63

Other Liabilities & provisions 1492.77 1482.94

Total Liabilities 82843.42 78633.63

Assets

Cash & balances with RBI 2756.05 3411.66

Balances with Banks, Money at call 163.44 198.09

Advances 56964.27 54828.20

Investment 17545.34 16184.99

Gross Block 826.42 775.00

Revaluation Reserves 470.07 412.12
Net block 356.35 362.88

Capital WIP - -

Other assets 5057.96 3647.92

 Total assets 82843.41 78633.64

Contingent Liabilities 10039.14 8752.11

Book Value(Rs.) 176.94 190.12

Financial Statement

Balance Sheet of Karnataka Bank Ltd for the year 2015-16 to 2019-2020

(Rs. in crores)
Interpretation

With the right marketing strategy used to reach the target audience and increase
deposits account growth. As bank is using more of digital banking/transaction and
going digital, there is increase in deposit amount from 2019-2020. Bank has also
increased the amount of reserves that it maintainers. This shows that bank has kept
sufficient amount in hand. These amounts are neither lent to customer nor have any
investments been made. Amount of investment that the company has made over the
last 2 years.

Profit & Loss A/c of Karnataka Bank Ltd (Rs. In Crores)

Particulars March March
2020 2019

Income
Interest/Discount on advances/Bills 5155.84 4698.03
Income from Investment 1160.13 1105.65
Interest (With RBI and inter-bank funds) 45.03 15.99
Others 114.20 85.65
Total Interest Earned 6474.77 5905.96
Other Income 1396.05 1001.96
Total Income 7870.82 6907.92
Expenditure
Interest Expended 4444.41 4000.84
Provisions (employees) 896.99 604.99
Depreciation 63.76 54.14
Operating expenses (excluding costs of employees 807.99 798.02
and other depreciations)

Total Operating expenses 1769.64 1457.27

Provision (income tax) 91.00 129.99
Provision (deferred tax) - -
Other Provisions and contingencies 1134.74 842.01
Total Provisions and Contingencies 1224.99 972.57

Total Expenditure 7439.04 6430.68

Net Profit (loss) 430.99 476.99
Net profit (loss) (after EI) 430.99 476.99
Profit or Loss b/f 118.99 101.99
Profit or Loss (appropriations) 552.03 572.99

Appropriation
Statutory Reserve (transfer) 110 180.00

Revenue and Other Reserves (transfer) 30 88.50

Capital Reserve (transfer) 184.01 -
Dividend and its tax PY 118.99 -
Equity share dividend - 84.78
Tax on dividend - 17.43
Balance c/f to balance sheet 101.68 119.65

Total Appropriation 551.43 579.47

Other Information
Earnings per share

EPS(basic) 12.99 15.99

EPS(diluted) 13.89 16.89
Dividend (%)
 Equity Rate (%) - 38

Analysis of Financial statement using Ratios

Analysis of ratios compares several data from a particular company’s profit and loss
A/c and balance sheet to get inputs related to solvency, profit, liquidity, and its
efficiency. It can make out how company is performing throughout the year, while
comparing a company to another.

Debt and Equity ratio:

Debt Equity ratio = Total Debt/ Total Equity
Table 1.1: Debt - Equity ratio
Year Total debt Equity DER
(%)

2020 75850.27 5500.38 13.79

2019 71777.63 5373.06 13.36

2018 63687.26 4993.94 12.75

2017 57565.73 5142.59 11.19

2016 51539.69 3690.59 13.97

2020 2019 2018 2017 2016

Interpretation:
Karnataka Bank shows high debt equity ratio in the year 2016 and it indicates that
bank is doing good and it shows high borrowings as well as deposits. It is quite less in
the year 2017 when compared to the consecutive year. In the year 2020 it stands 13.79
which also mean that company is doing good business.
 Assets Turnover Ratio:

Asset Turnover Ratio=Net sales revenue/Total Assets

Table 1.2: Assets Turnover Ratio

Year Sales revenue Total assets Asset turnover ratio

2020 7870.82 82843.41 0.09

2019 6907.92 78633.64 0.08

2018 6378.09 69957.45 0.08

2017 5994.74 64126.55 0.09

2016 5535.07 56500.33 0.09

Asset Turnover Ratio

0.092

0.088
0.086
0.084
0.082

0.078
0.076
0.074
2020 2019 2018 2017 2016

Interpretation

Asset turnover considered to be an activity ratio, which is a group of financial ratio

that measures how efficiency the company uses its assets. It can be further classified
into fixed asset turnover and Working capital turnover ratio.

Karnataka Bank shows higher asset turnover ratio in 3 years i.e. 2020, 2017 & 2016 it
indicates that company is doing quite good in that particular year which mean that
high loans are provided to the customers. In the year 2019 & 2018 it is comparatively
less, that means company not using its assets (loans) efficiently to generate sales
Credit Deposit Ratio (LDR):

CDR =Total Advances/Total Deposits * 100

Table 1.3: Loan/Credit Deposit Ratio

Year Advances Deposits Credit deposit ratio
(total) (total)

2020 56964.27 71785.15 79.35

2019 54828.20 68452.12 80.10

2018 47251.75 62871.29 75.16

2017 37003.65 56733.11 65.13

2016 33902.45 50488.21 67.15

2020 2019 2018 2017 2016

Interpretation:

It is popularly known as CD ratio. This is the ratio which explains how much a
financial institution provides from the deposits. A higher CDR denotes that it is more
reliance on deposits for lending and vice-versa.

Karnataka Bank Ltd. has high credit deposit ratio in 2019 i.e. 80.10 which indicates
that company has more reliance on deposits. 2017 had less comparatively to all the
five years where company has lent lesser amount of loan. In 2020 CDR stands 79.35,
it tells company is generating enough loans.

Net Interest Margin Ratio

NIM= (Interest earned-Interest expanded)/Total Assets

Table 1.4: Net Interest Margin Ratio

Year Interest earned- Total Assets Net Interest
Interest expanded Margin ratio (%)

2020 2030.36 82843.41 0.02

2019 1905.12 78633.64 0.02

2018 1857.65 69957.45 0.03

2017 1490.62 64126.55 0.02

2016 1302.87 56500.33 0.02

0
2020 2019 2017

Interpretation

Above 3% NIM ratio shows that company is doing well. Karnataka bank ltd shows
above 3% in only one year that is 2017, which tells us that company is doing its
investment decision correctly. Rest of the year its below 3%, hence we can conclude
that company’s decision regarding investment is quite bad in the year 2016, 2018,
2019 & 2020.
CHAPTER 2

CONCEPTUAL BACKGROUND AND LITERATURE REVIEW

BACKGROUND OF THE STUDY

E-banking banking is a system where financial sector that is bank helps various
customers and other business units to control their bank accounts, Banks also helps to
do transactions from different places of the country and obtain important information.
E-Banking is a system which includes Net banking, Mobile banking, Internet banking
and digital transaction where the devices such as computer, automated teller machine,
and PDAs with this all the customer can improve their banking knowledge.

It has gained lot of popularity during last few years and it has experienced huge
expansion in banking sector. E-banking typically said as core banking where we can
have or use the banking facilities anywhere or everywhere in the country.

Electronic banking mostly used by the younger generation hence they are more aware
about it, as it has lots of benefit using E-banking it is the duty of each to make
banking to give some input about electronic banking to the older generations as well.
Usually E-banking will be available 24/7. Customer can avail services at any time,
this has reduced the paper work in bank branch. It will give speed and hustle free
services to the customers.

The credentials for E-banking are normally different for Net banking, Mobile banking,
Internet banking and digital transaction. Banking industry allocates Mobile numbers
of customer and customers should have a mind set to use the digital banking facility.
Customers’ will have different phone numbers and proper number has to be linked
with bank A/c.

E-banking determines performing basic banking transactions by customers’ through

different e-media such as internet. It can be defined as providing banks’ services to a
customer through digitally and this has given an opportunity to the concept of virtual
banking. The main aim of digital banking is reduce paper work and thus concentration
towards all other work has been constantly increasing day by day.

This particular study is conducted mainly to know whether the customers belonging to
this region that is a GP branch located at Neriya, Beltangadi are making use of
E-banking technology. And mainly survey is conducted over 50 samples and among
them 40 was customers and 10 were employees working in Karnataka Bank.

So, here questionnaire is prepared for both customers and employees, 10 questions
were assigned each. Under customer, questions were included like whether they are
aware about E-banking technology and are they making use of it.

Next 10 questions assigned for employees of Karnataka Bank. Those questions mainly
included what are the benefits staffs are getting after digitalization. Whether they are
convenient to use E-banking and to know does it helped towards their work.

This study titled impact of banking system and technology also helped to know what
the advantages for the growth of economy of the country.

So, basically this study is done to know what an all the advantages people are getting
after digitalization and how it is going to help in future.

LITERATURE REVIEW

Mohammad O Al-Smadi, Saad A Al-Wabel 1970 E-banking is the modern application

that has got expansion during last few years. The result of E-banking shows that
positive impact on banking performance. That is why bank kept on promoting E-
banking services throughout and encouraged the customers to use these kinds of
services further.

Sana Haider Sumra, Mohammad Kurram Manzoor, Hassa H Sumra, Mohammad

Abbas 2011 The penetration of E-banking new kind of facility or different condition
for all this type of industry. All types of banks are providing their services through an
electronic channel that is digital banking or E-banking. This study covers one bank
i.e. Karnataka Bank, Nerya which is situated in rural area. It also includes discussions
related to the kind of E-banking facility to be adopted din this bank

Himani Sharma 2011 Electronic Banking is used as a strategic tool by the banking
industry. So it includes employees view point on E-banking. This study reveals that
only few of the customer use E-banking as they have less idea about it and also this is
the branch in rural area usually customers from those place would have really less
idea about it. This study also reveals that it has improved the relationship between
customers and employees in this bank.
Maahdi , Razaul & Rahaman 2012 E-banking or distribution of financial services like
Net banking, Mobile banking, Internet banking and digital transaction. Electronic
channel has got high importance and it is spread with the various customer because of
rapid growth and improvement in information technology as well as increased
competition between private and public sector banks

Lustsik 2004 Internet banking or E-banking has different kinds, for better transactions
via mobile, TV, internet and computers. Customer’s expectations and desires towards
services are rapidly increasing as technology improving. Now a day’s customer wants
to operate and do their transactions at any location and any time in a very effective
way

Nel J Boshoff C, Raleting T 2012 Here the study of impact of E-banking in banking
sector has done formation of different attitude at very low income as well as customer
not using E-banking. The sample has revealed high user and non user of E-banking.
The finding has suggested that easy usage in attitude of customers and most of them
have found that it is easier to use this technology has reduced the work burden of
many employees working in the particular bank

Ahmmed M, J R Shah, Mohammad A L This study explains that many of the

customer think that it saves time when compared to traditional banking. The study
says that highest number of people use mobile banking. Out of 100, 65 of them have
agreed that mobile banking/Internet banking is useful. From the above research, other
researcher and employees as well as customers will get some input or insights about
the problem

Kenneth B Y, Rastogi S, Mehrotra A 2009 Customer satisfaction towards E-

banking technology is an important role in developing economy and improve the
growth of the country. This research was conducted on respondents taken from the
particular bank which is a GP branch located at Nerya, Belthangadi, India. The
finding of his study is that now a days customer are attracted towards e-banking
services, irrespective of their age and profession. Most of the customers have
knowledge but still prefers to do traditional form of transaction as they believe that
online transaction includes some kind of fraud
Yang A S 2009 Factors associated with adopting E-banking system and technologies
were properly discussed among the users or customers of the bank. This pattern
includes the usefulness of e-banking system and its help to fulfil personal or mobile
banking needs, provides convenience to the customers irrespective of location and
time and it isles costly.

Petrus G, Nelson O N 2006 The results of impact of E-banking system and

technologies to customers and employees of the bank branch in Nerya, shows that
ease and convenient usage are the 2 important terms of E-banking. Perceived and
behavioural intentions of mobile or online banking have increased rapidly and any of
the customers are denying using this.

Avinandan M, Prithwiraj N 2003 In his study observation over shared value is most
important factor to developing trust among customers. Communications have a strong
power. Usually it improves trust to enhance customer’s interest and commitment over
E-banking technology and system and transaction done through this system. An
important contribution concentrates towards how trust over E-banking technology is
developed over the years and making roper usage of E-banking is depends on
perceived trust

Akinci Et Al 2004 Under this paper it reveals that customers attitude in terms of E-
banking technology and system, lot of differences has been created between users and
non users of digital banking with respect lot of other important factors like
demographic factors, personal factors etc…The usage of E-banking depends on
preference or behaviours of the customers

Joseph and Stone 2003 According to the research done under this the findings about
impact of E-banking and its ability to provide services with the help of technology.
The digital banking services are considered as one of the important factors for any
banking industry to improve customer satisfaction and customer retention. Here
customer can get easy availability of any banking facility and customer need not wait
for long

Malesky 2004 Under this research has been done use of E-banking system. This study
indicates that E-banking has reduced long wait in the bank and improved information
processing system for each and every customers. The study implies that this particular
bank accessing this technology but as the bank consists of customers belonging to the
age group 60 and above most of them prefers to do manual transaction as they get
satisfaction doing traditional banking

Shittu 2000 Electronic banking has given convenience to all the customers and
employees working under this particular bank. As debit card replaced with the cash
most of the people would like to carry less cash with them as they need not take risk
of carrying high amount with them. Card facility given a lot of advantages to the
customers. E-banking introduced new technologies and showed reduction in the
number of clearing days.

Different kinds of bill payments can be done and even investment in stock market and
different mutual funds can be possible through this technology. There is exception for
withdrawing amount through this technology. The use of internet banking is a new
alternative for banking industry for providing any financial services to their
customers. All banks have adopted E-banking and making use of it, as it is one of the
convenient and cheapest ways to do transactions as well

Stewart 1999 Under this research it reveals that demerits of internet banking in few
branches highly affected because there were no trusts among the customers. The
research also proved that E-banking is a computer based communication and it
relatively less personal and socio economical than manual exchanges/transactions.
Customer whose relationship is good with employees based on efficiency of services
offered in terms of rate of adoption and acceptance of E-banking
 CHAPTER 3

RESEARCH DESIGNING

Statement of the problem

This study or research is mainly done to know the impact of E-banking system and
technology in rural area. How many of them are using E-banking in that particular
place, whether it is really helpful to the customer or they are aware about the
technology. Whether the employees of the bank are giving input about E-banking.

What are the benefits employees and customers are getting because of E-banking and
how it reduced their work.

Need for the study

• How E-banking or Internet banking is useful in developing the economy and this
study mainly focus on how this will help the future of banking
• As it provides 24/7 service to the customers, this is beneficial to both employees
as well as customers. This study includes how customers and employees are
making best use of internet banking
• As E-banking is very important for present and future and it is significantly
related to customers age, education, occupation and income
• How customer often do their banking enquiry using Internet banking, how they
easily access their banking related information or accounts sitting at home or
office
• E-banking also includes electronic fund transfer, under this transaction done from
one bank account to other A/c electronically. And as this branch is located at the
rural area how does it help to those customers and how they are making use of it.

Objectives of the study

• To know whether the customers are aware about E-banking technology and are
they making use of this system
• To know whether the digitalisation has beneficial to employees working under
this particular bank
• To understand whether introduction of E-banking technology has impacted
towards economic growth of the country

Scope of the study

In financial and banking industry there is massive improvement towards technology.

It has adopted technologies like E-banking, E-lobbies etc. This study of impact of E-
banking system and technologies in Karnataka Bank, includes how the people are
adopting new technologies and do they making use of it. This study also includes how
to make aware about E-banking to the rural people/customer’s.

Research Methodology

• Primary Data:

It is the process of gathering data through surveys, interviews or experiment. Here

data is collected directly from the employees and customers of the particular branch
through questionnaire method.

• Secondary Data

It refers to data which has been already collected by other than the primary users. For
this study secondary data has been collected from financial statement and balance
sheet of the company and also company website is referred.

• Convenience Sampling

Here people are simply sampled because they are convenient sources of data
researchers. Under this study total sample size was 50. Among them 40 were
customers and 10 were employees belonging to this region. All of them were
convenient to answer the questionnaires.

Hypothesis for the study

H0: Customers are not aware about E-banking technology H1:

Customers are aware about E-banking technology

And

H0: E-banking technology has not created any benefits to employees

H1: There is lot of benefits to employees after the introduction of E-banking
Limitations of the study

As this branch was situated in rural area many of the customers’ were unaware
about E-banking and other new technologies

Could not get data from large sample size

Chapter Scheme

Chapter 1: Introduction

Introduction, Industry & Company profile, Promoters, Vision Mission and Quality
policy, Product/service profile, SWOT Analysis, Future growth and prospects and
financial statement

Chapter 2: Conceptual background and Literature review

Theoretical background and literature review on liquidity management

Chapter 3: Research Design

Statement of the problem, Objective, Limitation, Research methodology Chapter

4: Analysis and Interpretation:

It includes data analysis and interpretation

Chapter 5: Findings, Conclusion and Suggestions

It includes findings, suggestions and conclusion after detailed analysis of the study
CHAPTER 4

ANALYSIS AND INTERPRETATION

Does E-banking provide more reach when compared to traditional banking? Table 4.1

Responses No. of respondents Percentage

YES 15 37.5%

MODERATE 13 32.5%

NO 12 30%

TOTAL 40 100

Interpretation

Under this particular questionnaire most of the customers’ have responded that it has
high reach when compared traditional banking because E-banking is technology
where we can sit at home and can access the facilities related to bank. So, majority of
the people were comfortable with the system and there are 30% of the people who
were stick to traditional banking system as they didn’t have any about modern
technology.
Do the people belonging to this area, are really making use of E-banking effectively?

Table 4.2

Responses No. of respondents Percentage

YES 15 37.5%

MODERATE 5 12.5%

NO 20 50%

TOTAL 40 100

Interpretation

Under this questionnaire 50% of them have responded that, the customers’ belonging
to this are not really making use of E-banking because this branch is based in rural
area and customers’ belonging to this region are not really know the technology and
how it works and old age customer who cannot operate the system are still using
traditional banking. There are some customers’ (37.5%) using this system they are
belonging to the age group of 20-35

Does customers’ get education regarding E-banking from the bankers’?

Table 4.3

Responses No. of respondents Percentage

YES 16 40%

NO 24 60%

TOTAL 40 100

Interpretation

Under this questionnaire many of the customers’ have responded that they will not get
any input about E- banking from the staff. Here employees fail to give education
regarding new technology, many of them have suggested that it would have been
better if they get education regarding E-banking from the staff so that they can make
use of it at the most.

40% have responded that they will get input as they have knowledge regarding the
particular technology.

What are the age group using this technology at the most?
Table 4.4

Responses No. of respondents Percentage

15-25 12 30%

25-40 14 35%

40-60 13 32.5%

60-75 01 2.5%

TOTAL 40 100

Interpretation

Under this questionnaire includes which age group of people make use of E-banking
at the most. This survey has concluded that age group which belong 25-40, the
customers’ belonging to this region are employed and educated and they will have
enough idea about modern technology. And the customers’ belonging to 60-75 age
group are making least use of it as they are still dependent on traditional banking and
also they do not much idea about E-banking

Does it take much time to understand this system by the rural people?

Table 4.5

Responses No. of respondents Percentage

YES 18 45%

SOMETIME 10 25%

NO 12 30%

TOTAL 40 100

Interpretation

Under this questionnaire 45% of the customers’ have responded that it is difficult to
understand this technology, as this branch is a GP branch and customers’ cannot
easily access the system. It requires time to understand the method and adoption of
new technologies. And there are customers’ who can adopt it easily as they already
have idea about it.

Does E-banking creating any confusion /difficult among the customers’ belonging to
this area?

Table 4.6

Responses No. of respondents Percentage

YES 10 25%

SOMETIME 15 37.5%

NO 15 37.5%

TOTAL 40 100

Interpretation

Under this questionnaire only few of them have responded that there is less confusion
or difficulty involved in E-banking as all the safety measures like OTP and other
criteria have been adopted by the each bank. Same portion of the customers’ have
responded that SOMETIME it creates confusion as server would be busy most of the
time and NO have been responded so that the customers’ are used to it.
How frequently E-banking facilities are used?

Table 4.7

Responses No. of respondents Percentage

DAILY 15 37.5%

QUARTERLY 13 32.5%

MONTHLY 12 30%

TOTAL 40 100

Interpretation

Under this questionnaire most of the customers’ have responded that they avail
services daily. Most of them have use Google pay, PhonePe, Paytm for daily
transaction. Few of them have used this when in need. Customers’ who use it monthly
to receive their monthly salary
Does customers’ are completely satisfied with this system?

Table 4.8

Responses No. of respondents Percentage

YES 10 25%

SOMEWHAT 20 50%

NO 10 25%

TOTAL 40 100

Interpretation

Most of the customers’ feels that they are not completely satisfied with this system as
they are not completely aware about the procedures followed in E-banking system.
Most of them feel they are somewhat adopting this technology and not completely
satisfied. And few customers’ i.e. 25% feels they are making use of it. And 25% of
customer’s have responded NO because they are not adopting technology because
lack of knowledge.

Does it include less cost to customers’ when compared to traditional banking? Table
4.9

Responses No. of respondents Percentage

YES 11 27.5%

SOMETIME 13 32.5%

NO 16 40%

TOTAL 40 100

Interpretation

Under this survey/questionnaire many of them have responded that there is no less
cost involved for making transactions or to make any other work related to bank after
the introduction of E-banking. About 40% of the population feels that still it includes
high cost as there is maintenance cost has been involved. If the transaction is high per
day there will be deduction of amount from particular A/c.

Customer does not trust this system as they believe that it includes fraud?
Table 4.10

Responses No. of respondents Percentage

YES 14 35%

SOMETIME 10 25%

NO 16 40%

TOTAL 40 100

Interpretation

Under this questionnaire it has proved that customer do not believe this system as they
are not sure and secured about E-banking facility. Many of them have mindset of not
using it as it involves fraud and it is kind of cheating/fraud. So, many of them would
like to go for traditional banking.
Analysis of Z-Test

Hypothesis

H0: Customers are not aware about E-banking Technology

H1: Customers are aware about E-banking Technology

1. Making E-banking facilities effectively/ do they aware about E-banking

technology?

3 1.875
3 1.875 3
1.875 z-Test: Two Sample for Means
3 1.875
3 1.875 Variable 1
3 1.875 Mean 1.875
3 1.875 Known Variance 0.88141
3 1.875 Observations 40
3 1.875 Hypothesized Mean Difference 1
3 1.875 Z -6.736600025
3 1.875 P(Z<=z) one-tail 8.10674E-12
3 1.875
z Critical one-tail 1.644853627
3 1.875
P(Z<=z) two-tail 1.62135E-11
3 1.875
z Critical two-tail 1.959963985
3 1.875
2 1.875
2 1.875
2 1.875
2 1.875
2 1.875
1 1.875
1 1.875
1 1.875
1 1.875
1 1.875
1 1.875
1 1.875
1 1.875
1 1.875
1 1.875
1 1.875
 1 1.875
1 1.875
1 1.875
1 1.875
1 1.875
1 1.875
1 1.875
1 1.875
1 1.875
1.875
0.859375 0

Interpretation

The result of Z Test shows our study is significant with 0.05 level of Alpha. So we
can reject null hypothesis which says customers are not aware about E-banking as our
P value of Z test is very smaller than 0.05 for one tailed test. So, the study is efficient
in proving customers are aware about E-banking system and the customers’ makes
very less use of it.
This test proves that customers have knowledge regarding E-banking technology but
most of them prefer to go bank and make the transaction as they feel that there is no
secured payment through this system. Many of them have responded that it is a
difficult method of payment and it creates confusion among them. So, even though
they are aware about it most of them prefer to do transaction through bank and not
adopting new technology.
Introduce of E-banking has helped the employees to concentrate on other major work
other than deposits and withdrawals?

Table 4.1.1

Responses No. of respondents Percentage

YES 3 30%

PARTIALLY 5 50%
YES

NO 2 20%

TOTAL 10 100

Interpretation

Under this questionnaire 50% of the employees have responded that PARTIALLY
YES, because even though it has reduced their work and helping to concentrate on
loan and recovering NPAs still many of the customers’ do not use it as they do not
feel comfortable. And 30% of the employees have agreed that it is useful for them as
high interest could be given towards NPA.

Does introduction of E-banking has really reduced the paperwork?

Table 4.1.2

Responses No. of respondents Percentage

Agree 3 30%

Strongly agree 5 50%

Disagree 2 20%

TOTAL 10 100

Interpretation

Under this survey it has proved that introduction of E-banking reduced lot of paper
work involved while doing transactions in bank. 50% of the employees strongly agree
that there is reduction of paper work and few disagree because customers’ belonging
to that branch are not making use of it.

Employees are completely satisfied with this system?

Table 4.1.3

Responses No. of respondents Percentage

Highly Satisfied 5 50%

 Satisfied 4 40%

Dissatisfied 1 10%

TOTAL 10 100

Interpretation

Under this questionnaire 50% of the employees have agreed that E-banking
technology highly satisfied to them as it reduces their work and gives lot of time to
concentrate on other important work. Employees who could not adopt this and who
are addicted to do manual work have disagreed it.

Does digitalization has made employees’ life riskier?

Table 4.1.4

Responses No. of respondents Percentage

YES 1 10%
 PARTIALLY 6 60%
YES

NO 3 30%

TOTAL 10 100

Interpretation

Under this questionnaire 60% of the employees working in Karntaka Bank have
responded PARTIALLY YES because many of them have experienced that there will
be less work after digitalization. And they feel that it may effect to their job as there
will be less work involved.
Is it time consuming task for employees’?

Table 4.1.5

Responses No. of respondents Percentage

YES 3 30%

PARTIALLY 5 50%
YES

NO 2 20%

TOTAL 10 100

Interpretation

Under this questionnaire 50% of the employees have responded it is time consuming
task for employees. Basically this is a GP branch and many of the customers’ are
unaware about the technology and employees have to educate them. And as already
has proved that customers’ usually take lot of time to understand. So, employees feel
that it is time consuming task.
Do employees feel that still customers’ are dependent on them?

Table 4.1.6

Responses No. of respondents Percentage

YES 3 30%

PARTIALLY 5 50%
YES

NO 2 20%

TOTAL 10 100

Interpretation

Under this questionnaire about 50% of the employees have responded as

PARTIALLY YES, which means customers’ are still dependent on employees. E-
banking has made employees’ life easier but there are people who do not use this
technology as customers’ feels that it includes fraud and few of them do not believe
this system

Do employees face problems from their customers’ with regard to E-banking? Table
4.1.7

Responses No. of respondents Percentage

YES 5 50%

PARTIALLY 1 10%
YES

NO 4 40%

TOTAL 10 100

Interpretation

Under this questionnaire 50% of the employees have said that they have to face
problems from the customers’. For example if transaction is not done in time or while
doing NEFT transactions using E-banking it may create problem to employee from
customers’ side
Do employees feel that they are giving enough input about E-banking to their
customers’?

Table 4.1.8

Responses No. of respondents Percentage

YES 8 80%

NO 2 20%

TOTAL 10 100

Interpretation

Under this questionnaire 80% of the employees believe that they will give enough
input on E-banking and its usage but they also have mentioned that customers’
belonging to this area will take much time to understand it and they will not make use
of it.
Do the employees of this branch feel that introduction of E-banking has not reduced
their work as customers’ still follow traditional banking?

Table 4.1.9

Responses No. of respondents Percentage

YES 3 30%

SOMEWHAT 5 50%

NO 2 20%

TOTAL 10 100

Interpretation

Under this questionnaire 50% of the employees feel that it still includes some kind of
paper work even after adopting modern technology. And most of the customers’
comes under this region have not completely follow digitalisation that is why paper
work is still included

Does E-banking have given positive impact to employees of this particular branch?

Table 4.1.10

Responses No. of respondents Percentage

YES 6 60%

PARTIALLY 3 30%
YES

NO 1 10%

TOTAL 10 100

Interpretation

Under this questionnaire employees are strongly believe that digitalisation has given
lot of positive impact towards their work. They need not do the things manually and
all the relevant data would be recorded in PC. So there will be fewer burdens to
employees when compared to traditional banking.
Analysis of T Test
Hypothesis
H0: E-banking technology has not created any benefits to employees
H1: There is lot of benefits to employees after the introduction of E-banking system

1. Employees are getting benefits/they are satisfied with this technology? t-Test:
Two-Sample Assuming Unequal Variances
Variable 1
Mean 2.4
Variance 0.488888889
Observations 10
Hypothesized Mean Difference 1
Df 9
t Stat 6.331738236
P(T<=t) one-tail 6.78883E-05
t Critical one-tail 1.833112933
P(T<=t) two-tail 0.000135777
t Critical two-tail 2.262157163

Interpretation
To test the null hypothesis which says that there is no benefits to employees after the
introduction of E-banking system. For this I have conducted T test with 10 sample response.

The result shows that the study is very significant with the 95% degree of freedom. The P
value is one tailed test showing lesser value than 0.05 indicates that we can reject the null
hypothesis and accept the alternative hypothesis.

After digitalization employees can completely concentrate on recovering NPAs which is the
main asset for any bank and further there is reduction of paper work and fewer invoices
involved as everything happens digitally, this reduces work pressure.

So, we can conclude that there is benefit to employees and they are completely satisfied with
the introduction of E-banking technology.

53
How does E banking help in economic growth?
ATMs deployed by the Karnataka Bank

Table 4.2.1
Year Growth rate (%)

2016 45

2017 39.67

2018 9.58

2019 5.48

2020 14.36

This bar diagram shows there is lot of usage of ATMs during 2016 as people were so
much comfortable with holding cards wherever they go and use it whenever there is
need. In 2019 graph shows that usage of ATMs has come down as most of the users
comfortable using mobile banking.

Total number of debit card issued

Table 4.2.2
Year Growth rate (%)

2016 18.64

2017 41.30

2018 18.86

2019 16.33

2020 16.08

Table and graph clearly shows that debit card was highly used in the year 2017 i.e.
about 41.30%. Compared to all the 5 years 2017 stands in peak and other 4 years has
less usage of debit card.

2020 shows less percentage i.e. 16.08 as most of the people comfortable using mobile
banking rather than using card.

55
Total number of credit card issued

Table 4.2.3
Year Growth rate (%)

2016 10.73

2017 16.78

2018 22.18

2019 24.39

2020 29.05

Chart shows increase in the rate of usage of credit card year by year. Credit cards are
highly used by the businessman and most of the people use it for shopping as well.

Here person need not have cash in his A/c. So, everyone feels comfortable using
Credit card and that is why its growth rate is going on increasing.
Total number of NEFT Transaction

Table 4.2.4
Year Growth rate (%)

2016 27.71

2017 30.32

2018 35.07

2019 49.47

2020 69.99

Interpretation

This chart also shows high growth rate in the year 2020 and it is continuously increasing from
the year 2016-2020. National Electronic Fund transfer has got high importance now a day as
it is kind of secure payment.

Even NEFT transaction can be easily done through Mobile banking and need not do it
manually with lot of efforts and many of the customers’ EFT as easy way of transaction.
Total number of RTGS transaction

Table 4.2.5
Year Growth rate (%)

2016 5.99

2017 9.68

2018 14.39

2019 15.39

2020 18.37

Interpretation

This chart also shows spike in the growth rate of RTGS for the year 2020 and there is also
continuously growth for the last 5 years.

RTGS is a system where transaction will happen between 2 banks. And two particular banks
find it suitable method to do transaction.

Total number of Mobile Transactions

Table 4.2.6
Year Growth rate (%)

2016 77.69

2017 81.52

2018 126.55

2019 150.80

2020 160.45

200
150
100

Interpretation

Graph has clearly explained that over the year’s usage of mobile banking is growing
rapidly and it has high importance in the present era. In the 2020 it has showed growth
rate of 160.45% and this percentage shows that usage of mobile banking is really high
when compared to all the above. Customers find it easy way to do transaction. And it
shows high economic growth.
Analysis of Correlation method to know how does E –banking helpful for economic
growth
Year ATM Debit Credit NEFT RTGS Mobile
card card Transaction

2016 45 18.64 10.73 27.71 5.99 77.69

2017 39.67 41.3 16.78 30.32 9.68 81.52

2018 9.58 18.86 22.18 35.07 14.39 126.55

2019 5.48 16.33 24.39 49.47 15.39 150.80

2020 14.36 16.08 29.05 69.99 18.37 160.45

ATM Debit card Credit card NEFT RTGS Mobil

e
transa
ctions
ATM 1

Debit 0.564439795 1
card
Credit -0.85740254 -0.385478153 1
card
NEFT -0.61874174 -0.484736601 0.886696641 1

RTGS -0.886835044 -0.426946681 0.997206754 0.867015657 1

Mobile -0.912755036 -0.627718533 0.951082726 0.882152459 0.959875106 1

transac
tions

Interpretation

The correlation analysis showed that the 6 variables namely RTGS, Credit card,
Mobile Banking, NEFT, Debit card, ATM provides a contribution towards the growth
in the service industry in a positive manner, it gives negative impact that is it doesn’t
help in the increase of GDP in first place. It shows a negative correlation with GDP of
India. It indirectly helps in boosting of the GDP by contributing to the service industry
that is the banking sector. We can say as the contribution of other sectors are negative
and even if there is growth in the E-banking, it is not reflected in the growth of GDP.
 CHAPTER 5

FINDINGS, CONCLUSION AND SUGGESTION

Findings

• E-banking has reached more when compared to traditional banking and

customers’ belonging to particular region are trying to adopt this technology
• Level of usefulness and adopting this technology are significantly less by the rural
people when compared urban and semi-urban areas
• Many of them have responded that E-banking is a good option next to traditional
banking but customers’ will take time to understand the procedures involved in
using electronic banking
• Customers’ belonging to this region are not really making use of E-banking at the
most, only few of them are using it. That is why employees has give more time
towards their work
• Youths are making highest use of it and other age groups have fewer knowledge
about it
• If they get good knowledge/ input about E-banking technology from the staffs of
the branch, it would have better future and surely it will reduce work of
employees
• Employees feel that digitalisation has made their life riskier as most of them
responded that there is no job security as manual work has been reduced after the
introduction of E-banking
• Most of the customers’ have responded that it includes and transaction will not be
secure under this kind of system
Suggestions

• Most of the customers’ have responded that they do not get education about
E-banking from the employees of the bank, so it would be better if the employees
give some input regarding usage of E-banking system
• They could have been given a special training about E-banking as most of them
feel that it includes fraud and they do not trust this technology completely and
they also believe that there is no security in this system
• Employees should suggest to their customers to make use E-banking and not to
depend on traditional banking, so as to reduce paper work and work pressure
• Future of banking would be much easier and comfortable when the entire
customer adopts modern technology. And banker can concentrate on other major
work other than providing withdrawals and receiving deposits
• As it is not a time consuming task for both customer as well as employees they
can concentrate on some other productive works
• There is increase in growth rate after digitalization. High usage of E-banking
technology would possibly results to economic growth and increase GDP of the
country
Conclusion

This research paper includes impact of E-banking system and technologies to

customers and employees of this particular and economic growth that has happened
after digitalization. After the survey has been done, it has concluded that customers’
belonging to the particular are not making use of E-banking and they get time to
understand the technology. Employees find it beneficial for them and it has reduced
their work load when compared to traditional banking. If the employees are become
successful in giving knowledge or educate them regarding this system future of
banking system would be much better. This technology also helped to the economic
growth, and improvement of this system would help to increase the GDP of the
country.

Overall study has proved that employees are much comfortable with this system than
customers’ as they belong to rural area they don’t show interest towards this and will
be comfortable with tradition baking and they have least knowledge about modern
technology.
Bibliography www.karnatakabank.com

www.financialexpress.com

www.moneycontrol.com

https://wap.business-standard.com

www.wikipedia,org

96th Annual Report of Karnataka Bank Ltd. 2019-2020

Abraham H (2012) Challenges and opportunities of adapting electronic banking

Yuhhannes A (2010) important factors that shows about adopting the new technology
that is digital banking

Samppson development of technology and banking innovation

Sumra, S.H Manzoor, K.M Sumra H.H and Abbas (2011), The impact of E-banking
on the profitability of banks, Journal of Public Administration and Governance

A.A Agboola (2003) Inormation technology, bank automation and attitude of

employees

Major development of E-banking system and other issues related to India, by S.

Debhashish

Reports on ‘Inclusive growth and financial security the benefits of E-payment to

Indian society’ A publication on McKinsey & company on financial services
ANNEXURE

Balance Sheet of Karnataka Bank Ltd for the year 2015-16 to 20 17-2018

(Rs. in crores)
Particulars March March March
2018 2017 2016

Capital and Liabilities:

Share capital 282.00 282.00 188.47

ESC 282.0201 281.2 187.47

Total Reserve 4711.32 4859.97 3503.02

Networth 4993.94 5142.59 3691.00

Deposit 62872.00 56732.99 50487.99

Borrowings 814.99 832.30 1050.99

Total debt 63687.26 57565.73 51539.69

Other Liabilities & provisions 1276.27 1418.23 1270.06

Total Liabilities 69957.47 64126.55 56500.34

Assets

Cash & balances with RBI 3545.82 2929.27 2645.62

Balances with Banks, Money at call 55.19 344.76 399.30

Advances 47251.75 37003.65 33902.45

Investment 15444.45 20219.73 16256.65

Gross Block 761.60 720.57 306.64

Revaluation Reserves 416.22 0.00 0.00

Net block 345.38 720.57 306.64

Capital (WIP) - - -

Other assets 3314.86 2908.57 2989.67

Total assets 69957.45 64126.55 56500.33

 Contingent Liabilities 9926.45 7261.80 7385.69

Book Value(Rs.) 176.71 181.97 195.83

Profit & Loss A/c of Karnataka Bank Ltd (Rs. In Crores)

Particulars March March March
2018 2017 2016

Income

Interest/Discount on advances/Bills 4081.93 3793.56 3700.48

Income from Investment 1161.53 1298.23 1189.90

Interest (balance with RBI & inter-banks) 15.87 2.19 2.60

Others 164.42 91.42 99.23

Interest Earned 5422.99 5186.00 4991.99

Total other income 954.34 809.34 542.86

Total Income 6378.09 5994.74 5535.07

Expenditure

Interest Expended 3566.10 3694.78 3689.34

Payments (To employees) 524.79 601.03 443.02

Depreciation 50.06 49.57 41.99

Operating Expenses (except cost related to 763.98 653.38 505.94

employees)

Total Operating expenses 1338.83 1304.16 991.20

Provision (income tax) -15.45 15.69 112.71

Provision (deferred tax) - - -

Other Provisions and contingencies 1163.01 527.85 326.53

Total Provisions and Contingencies 1147.56 543.54 439.24

Total Expenditure 6052.49 5542.48 5119.78

Net Profit or Loss 325.61 452.26 415.29

Net Profit or Loss (after EI ) 325.61 452.26 415.29

Profit/Loss brought forward 137.14 0.3 0.04

Profit/Loss (for appropriations) 462.75 452.29 415.69

Appropriation

Transfer (Statutory Reserve) 82 125 230

Transfer (other reserves) 91.25 45.30 41.40

Transfer to/from Capital Reserve 51.05 112.80 8.85

Dividend and its tax for the previous year - - 0.00

ES dividend 113.04 - 94.23

Tax on dividend 23.01 - 18.99

Balance c/f to B/s of the company 102.23 137.14 0.03

Total Appropriation 462.75 452.29 414.99

Other Information

Earnings per share

EPS (basic) 11.52 19.38 22.04

EPS(diluted) 11.52 19.38 22.03

Dividend (%)

Equity Dividend (%) 30 40 50

Questionnaire with regard to Impact of E-banking in Karnataka Bank
Limited, Belthangadi, Nerya

To customers (40 respondents)

1. Does E-banking provide more reach when compared to traditional banking?

a) YES b) MODERATE c) NO

2. Do the people belonging to this area, are really making use of E-banking
effectively?

a) YES b) MODERATE c) NO

3. Does customers’ get education regarding E-banking from the bankers’?

a) YES b) MODERATE c) NO

4. What are the age group using this technology at the most?

a) 15-25 b) 25-40 c) 40-60 d) 60-75

5. Does it take much time to understand this system by the rural people?

a) YES b) SOMETIME c) NO

6. Does E-banking creating any confusion/difficult among the customers’ belonging

to this area?
a) YES b) SOMETIME c) NO

7. How frequently customers’ belonging to this region use E-banking?

a) DAILY b) MONTHLY c) WEEKLY

8. Customer does not trust this system as they believe that it includes fraud? a)

YES b) NO

9. Does customers’ are completely satisfied with this system?

a) YES b) SOME WHAT c) NO

10. Does it includes less cost to customers;’ when compared to traditional banking?

a) YES b) PARTIALLY YES c) NO

To Employees (10 respondents)
11. Introduce of E-banking has helped the employees to concentrate on other major
work other than deposits and withdrawals?

a) YES b) PARTIALLY YES c) NO

12. Does introduction of E-banking has really reduced the paperwork?

a) AGREE b) STRONGLY AGREE c) DISAGREE

13. Employees are completely satisfied with this system?

a) HIGHLY SATISFIED b) SATISFIED c) DISSATISFIED

14. Does digitalization has made employees’ life riskier?

a) YES b) PARTIALLY YES c) NO

15. Is it time consuming task for employees’?

a) YES b) PARTIALLY YES c) NO

16. Do employees feel that still customers’ are dependent on them?

a) YES b) STRONGLY AGREE c) NO

17. Do employees face problems from their customers’ with regard to E-banking?

a) YES b) NO

18. Do employees feel that they are giving enough input about E-banking to their
customers’?

a) YES b) NO

19. Do the employees of this branch feel that introduction of E-banking has not
reduced their work as customers’ still follow traditional banking?

a) STRONGLY AGREE b) PARTIALLY AGREE c) DISAGREEE

20. Does E-banking have given positive impact to employees of this particular
branch?

a) YES b) PARTIALLY YES c) NO