Abstract Itis the dream of Government of India to make India digital. As a part of thatall most all the banks in India have started providing banking services throughDigital Banking channel. Digital Banking channels are the channels providingbanking services other than the bank branches like net-banking, mobile banking,app-banking, phone banking, ATM, POS etc. Customer satisfaction being the keyfactor for sustenance and growth in today’s highly competitive financialmarket, it becomes very important to maintain highest level of servicestandards. To gauge the level of customer satisfaction in the trading bankingSERVQUAL model was used, however in the era of Digital banking, SERVQUAL modeldoes not fit. The study aims at identifying the constructs of service qualityfor the services provided through Digital Banking and their impact on customersatisfaction. The study also helps to identify the impact of individualconstruct on the overall customer satisfaction which allows the management toidentify the areas for improvement and thereby improve customer service inorder to sustain and grow.
Introduction Rapidspread and improvements in, Internet-based tools have occasioned the radicalchanges in the way of companies’ interactions with their customers (Ibrahim etal, 2006; Bauer et al., 2005; Parasuraman and Zinkhan 2002). An internet gateway that facilitatescustomers to use various categories of banking services starting from makingbill payment to investments in various financial instruments is called internetbanking (Pikkarainen, Karjaluoto, and Pahnila 2004) Digitalbanking means automatic service delivery for various banking products tocustomers with the use of or electronic machines or technology or internet atanytime and anywhere without any direct involvement of Banks’ employees at thetime of delivery of services. Digital Banking is also known as internet bankingor E-Banking or Mobile Banking (m-Banking).
InIndia almost all the banks and many of the financial institutes have welcomedand accepted the change from physical banking to digital banking. In today’s highly competitive market digitalbanking helps them to align their products with the needs of highly demandingcustomer needs and also helps banks to reduce cost of providing servicessignificantly. As through Digitalbanking customers can avail banking services “Anywhere and anytime services”,it helps customers in development of their business in this highly competitiveand rapidly changing world. Thegrowth of information technologies in the world has been phenomenal. Thanks tothese technologies, banks are being able to reach their customers anywhere atany time. Compared to banks abroad, Indian banks offering online services stillhave a long way to go. For online banking to reach a critical mass, there hasto be sufficient number of users and the sufficient infrastructure in place.(Megha Jain,) Ithas become essential for banks to work towards providing more and moreconvenient, efficient and effective customer services by finding out innovativeways in Digital banking.
In order to make customer experience better it isnecessary to find out the customers’ perception for the overall service qualityand the level of their satisfaction with the Digital banking services as ondate. Assessment of customer satisfaction and identification of gaps in servicequality will help banks in align their products and services with theexpectations of customers and distinguish themselves in this highly competitiveand customer oriented market and also help them to retain customers as well asattract new customers. LiteratureReviewIndianbanking sector has been entirely changed over a past few years. The banks arefronting various challenges and several opportunities stand open for them.Various technological and financial innovations like Automated Teller Machines,Credit Cards, RTGS, Debit Cards, mobile banking etc. have wholly transformedthe façade of Indian banking. However yet there is a need of more advancedsolutions in order to answer the challenges and converting opportunities intobusiness by the banks (Karamjit Kaur, Rajneesh). Usageof the Internet as a new unconventional network of dissemination of banking andfinancial services is no more a way toattain competitive advantage, but with the initiation of globalization and stern competition it has become an unavoidablenecessity (Flavian, Torres, & Guinaliu, 2004; Gan, Clemes, Limsombunchai,& Weng, 2006).
Severalresearch studies have been conducted on customer attitude and acceptance ofdigital banking and they have revealed that there are various elementsaffecting the customer’s approach towards digital banking. Consumer’s attitudestoward online banking are subjective to their familiarity of computer and newtechnology (Laforet and Li 2005). Online banking demands possibly the highestlevel of customer involvement, as it necessitates the customer to have accessto technology (a computer and an Internet connection) and be updated with additional technology regularly (Jane etal, 2004). Customers must have a certain ease with the technology to keep usingit on continuous basis (Servon, and Kaestner 2008). Convenientand accurate electronic banking operations, accessibility and reliability, goodqueue management, service personalization, friendly and responsive customerservice and targeted customer service have been identified as six compositedimensions of electronic service quality (Ibrahim EE, 2006). So far as onlinebanking adoption is concerned, security, trust and privacy concerns are beingconsidered as exceptionally significant from the customers’ point of view (Benamatiand Serva 2007).
Perceived usefulness, security and privacy are the decidingfactors to accept online banking (Qureshi, T.M., Zafar, M.K and Khan, M.B,2008). Elements of perceived ease of use and perceived usefulness have thepositive effect whereas the perceived risk has negative effect on the customersatisfaction for internet banking users (Ajimon George G.S. Gireesh Kumar,2013).
Efficiency, website design andprivacy are the fundamental elements of internet banking services and there isa direct relationship between internet banking service quality and customer satisfactionin banking industry. (Sadaf Firdaus and Rehela Farooqi 2014) Objectives: Globalisation and deregulations haveenabled the financial institutions to expand their reach at a global level andalso made the market highly competitive because entry of global players in thelocal markets. In the present scenario it simply not possible to for thesefinancial institutions to compete based on price and they need to concentratemore and more on quality of services and improvising the customer satisfactionlevels on ongoing basis. Further, internet based services have changed the faceof banking services. In this context the research aims at, 1. Identifyand Examine the elements influencing satisfaction level of customers fordigital banking services of selected retail banks 2. Evaluationof relative significance of identified elements on overall customersatisfaction of digital banking customersMethodology: DataCollection: Theprimary and secondary sources of data collected were adopted in this researchwork.
PrimarySource: Primary data collected through personally administered questionnaire SecondarySource: Secondary data in this research work were collected through booksjournals, magazines, and newspapers, Internet website etc.Forcollection of data bank branches of 4 Public sector, 4 Private Sector and 3Foreign banks were selected. Co-operative banks were excluded as they cater tospecific segment of customers and are not much in to Digital BankingServices. SampleSize: Primarydata collected from 102 bank customers using digital baking for more than 6months SamplingTechniques: Sampleselection was done through non-probability convenience sampling method. Sampling Tooland Technique: ? SPSS ? MS Excel RESEARCH FRAMEWORK Theservice quality of digital banking was checked on 7 constructs of DIGITALBANKING SERVQUAL namely 1) Applicability, 2) Accessibility, 3) Complexity, 4)Competence, 5) Assistance, 6) Security and 7) Connectivity. Figure 1 shows the conceptual framework beingused for this study. It displays the impacts of seven key constructs of qualityof services for Digital Banking services on customer satisfaction.