ABSTRACT
The study was an exploratory study aimed at understanding the effect of electronic banking services on customer satisfaction in Nigeria. The study used 2 Nigeria foremost banks (GTBank PLC and First Bank of Nigeria, PLC, as case study. A sample size of 109 respondents were utilized for this study which comprises of both the customers and staffs of two banks. Questionnaire was used as the principal tool for the data collection. With the aid of the SPSS the data was analyzed using basic statistical tools such as frequencies and percentages, while using ANOVA to test the hypothesis.
Based on the research findings, the study concludes that mobile banking have not effectively satisfied bank customer due to factors such as ATM downturn period have hindered the full satisfaction of bank customers; high acquisition cost, frequent interbank connectivity have hindered customers satisfaction with the use of POS and customer have enjoyed the innovative brain behind the introduction of debit card and are quite satisfied with it. The study recommends that regulatory bodies of the banks should bring an innovative system that will aid in the correction of the security challenges customer’s and banks face in the use of electronic banking and services.
CHAPTER ONE
INTRODUCTION
1.1 Research Background
From the era of the goldsmith to the era of passbook to the modern era of internet-oriented interaction between the banks and customers, e-banking models are used by financial institution to enhance their growth which is function of the depositor and customer that patronize their product. The satisfaction of these clients’ makes it very important for financial institution most especially banks that find themselves in a competitive edge. (Timothy 2012).The shift from the conventional banking system to the online banking is propelled due to the competitive environment of similar financial hubs, simplicity of transactions, security and privacy. Online banking system enhances customers’ full access to different internet banking methods such as Mobile banking, Automated Teller machine and Point of sales, to mention but a few.
Electronic banking can be divided into two forms which are mobile banking and internet banking. Internet are transactions done through connected laptops while mobile banking are financial services that are rendered on the wireless gadgets of customers. This two platform are the concepts that banks use to render their internet prowess services to customers within and outside their geographical location (Khraim, Al-Shoubaki, and Kharaim, (2011). Electronic banking debunked the arm chair method of the banking system so has to improve customer satisfaction, customer loyalty towards the organization and enhance service delivery to all units of the financial users in the society (Al-madi 2010). Sarlak and Hastiani (2011) and Khan and Khan (2010) depicted that customer’s requirement should be previewed on a regular basis and the geographical, industrial and regulatory gaps between banks and customers should be settled via the innovative dynamics of banks services.
The innovation and customer’s requirement and needs are the path that determines banks profitability, growth and customer’s base. Due to the fact that geographical and industrial location is menace to customers either individual’s or corporate body. Wunqwaniteh (2002) remarked customers has the ability of banks to make use of the services rendered through internet banking to meet their cognitive need of the customers. Customer satisfaction in terms of internet banking is the convenience to perform banking transaction anytime, anywhere, enjoying encrypted banking transaction with protected-password applications.
Worku, Tilahun and Tafa (2016) stated that the banking services activities in electronic banking in various countries have been found to generate immense profits for commercial banks through competitive advantages improvements, customers’ base increment, customer service enhancement and operating costs reduction. They further stated that in strategic move to increase customer base, some banking institutions have considered the usage of various type of cards, which help in further reduction of bank paper works, tellers, invoices and general cashier services while making banks with card products more competitive than banking institutions without one.
According to Kumbhar (2011) as cited by Worku, Tilahun and Tafa (2016) on customer satisfaction towards e-banking services which considered factors affecting customer’ satisfaction concludes that the adoption of quality ATM service as a core service by banking institutions is a means of costs reduction which has a significant effect on customers satisfaction in various banks.
Electronic banking used by banks have the holistic goal to attain organizational objective within a stipulated time bound. The goals attainment can only materialize based on the satisfaction the different classes of customer’s derive from their online and verbal transaction between the banker’s and their prospective customers. This study will aid to add to the compendium of knowledge of behavioral finance to investigate the effect of electronic banking services on customers’ satisfaction of selected big four in Nigeria.
1.2. Research Problem
The genesis of E-banking commenced from the use of telephone banking, Automated teller Machine and Point of Sales Terminal, direct payment bill, electronic transfer and online banking (Sefeena, Abdullar and Date 2010). This exceptional E-banking packages were developed to enhance service delivery, customer satisfaction and customer loyalty towards the organization.
The difficulty of the citing of the Automated teller Machine and Point of sales across various banking areas have reduced the expected satisfaction which the packages where created to solve. Availability of the machine, undue charges on the usage and the lack of internet connection when being used by the prospective customers have caused dis-satisfaction of the service delivered by the banks. The inaccessibility of internet for the wireless phones and bad network coverage have caused and hinge pin for the satisfaction of customers. This study will investigate how the various mentioned above E-banking service package have been able to impact on customer satisfaction of the selected banks.
1.3 Research Aims and Objectives
The main aim of the research is to investigate the effect of E-banking services on the customer satisfaction in Nigeria. The specific objective include;
1. To investigate the extent at which Mobile banking have aided customer satisfaction
2. To explore the impact of Automated Teller Machine on the customer satisfaction
3. To deduce the relevance of Point of sales terminals on customer satisfactions
4. To examine the impact of debit card on customer satisfaction
The following research questions will guide this study
1. Have Mobile banking aided customer satisfaction?
2. What impact does Automated Teller Machine have on customer satisfaction?
3. What relevance have point of sales terminal had on customer satisfaction?
4. Does debit card have any impact on customer satisfaction?
1.4 Research Methods
The researcher employed the use of both primary data and secondary data. The instrument of data collection for this research work was through distributed questionnaires.
The primary data was used to get first-hand information from the respondents via personal interviews and questionnaires. The secondary source of data was used to measure the effects of electronic banking on customers and were retrieved via the internet, company’s records.
The researcher used purposive sampling technique for this study. A sample was determined to obtain a broad view on the effect of electronic banking services on customers’ satisfaction from the bank under study based on this, the targeted population was (8000). Considering the fact that it is impracticable to reach out to the whole population (Awotunde and Ugodulunwa, 2004), the sample size of the study from the target population was determined using the Taro Yamane’s formula. Based on this, the population of one hundred and seventy (150) was used as the sample size.
1.6 Significance of the Research
The research will be beneficial to internal and external stakeholders within the geographical boundary of the financial institution. The stakeholders include customers, board of directors, regulatory bodies of financial institution and competitors.
Customers will benefit from the findings of the study by gaining the knowledge of the usefulness of the various forms of the E-banking packages, they have not been making efficient use of. Board of Directors will make use of the findings of study take better strategic decision depending of the percentage of impact the various E-banking packages have over each other, so has to direct their path of the one that suit their own model of transaction.
Regulatory bodies will use the findings to instruct the banks and non-bank to take well organized step towards improvement of customer satisfaction which will reduce the total idle funds outside the financial system. Competitors will be able sieve the visible value of each service packages needful for different location.
1.7 Dissertation Layout
Chapter one, which is the introductory part of this research talked about research background, research problem, research aims and objectives, research methods, significance of the research and dissertation layout.
Chapter two which reviewed the literatures started with conceptual framework where the following were reviewed; meaning of electronic banking; reasons for automation of banking operation; types of electronic banking; personal computer banking; telephone banking; internet banking ; automated teller machines (ATMS); mobile banking ; unstructured supplementary service data (USSD) and point of sale (POS). The chapter further examined the benefits of e-banking; challenges and insecurity of internet banking; customer satisfaction and customer satisfaction in e-banking. The theoretical framework and empirical review were also examined in this chapter.
Chapter three started with the introduction of Research Methodology used for the study. The chapter also examined the Methodological and Epistemological Choice and Justification, Research Design, Research Methods/Strategy, Procedure for Data Collection and Analysis, Target Population, Data Analysis, Limitations of the Study and Ethical Considerations.
Chapter four presented the results using tables, graphs, matrices and charts.
Chapter five summarized the research and interpreted the findings in the study. The Implication of research findings, contribution for further research, recommendation and conclusions were also examined in this chapter.