AN ANALYSIS OF FUNCTIONAL / PSYCHOLOGICAL BARRIERS AND QUALITY OF E-BANKING / INTERNET BANKING

Transcription

1 CHAPTER 5 AN ANALYSIS OF FUNCTIONAL / PSYCHOLOGICAL BARRIERS AND QUALITY OF E-BANKING / INTERNET BANKING 5.1 Introduction India is one of the leading countries in the world where e-banking / internet banking has been implemented by public and private sector banks. The importance of e-banking /internet banking services and adoption of such services by the customers and the quality of services offered by both public and private sector banks are analysed in the previous chapter. There has also been rapid growth in the adoption of the e-banking / internet banking services among bank customers. But, there has been considerable number of bank customers who still carry out the banking transaction in the traditional way. Thus, it seems that for some customers some factors cause resistance, thereby delaying or even preventing the adoption of Internet banking service. So, this chapter is aimed at analyzing the functional and psychological barriers for e-banking / internet banking in order to provide bank marketers with a better understanding of the reasons why some of the bank customers are not using Internet banking service. The banks are also interested in finding ways and strategies to get the rest of their customers, or at least part of them, to use the service. For banks, Internet banking service offers a way to decrease their costs and increase efficiency. Branch office service or keeping up bill payment ATMs for such a routine action as bill payment is expensive and inefficient for the banks. Therefore, the study on functional and psychological barriers of customers on adoption of internet 94

2 banking can increase the scholarly understanding of consumer resistance to innovations. Consumer resistance to innovations has been explained through different barriers that inhibit or even prevent the adoption of an innovation. Consumer resistance to innovations consists of functional barriers and psychological barriers. Usage, value and risk barriers constitute functional barriers, whereas tradition and image barriers refer to psychological barriers. Functional barriers are likely to arise if consumers perceive considerable changes from adopting an innovation, while psychological barriers are often caused by conflict with consumers' prior beliefs (Ram & Sheth 1989). 1 Therefore, 18 items for measuring functional and psychological barriers were included in the questionnaire with 7 point scale ranging from 1 for Very Strongly Disagree (VSD), 2 for Strongly Disagree (SD), 3 for Disagree (D), 4 for Neutral (N), 5 for Agree (A), 6 for Strongly Agree (SA) and 7 = Very Strongly Agree (VSA). Reliability of the scale items is tested using Cronbach Alpha Coefficient and underlying aspects of functional and psychological barriers are ascertained using Principal component method of factor analysis with Varimax rotation. The results of the reliability / item analysis are reported in Table Ram, S. and J.N.Sheth, Consumer resistance to innovations: The Marketing Problem and Its Solutions. Journal of Consumer Marketing. Vol. 6. No. 2, p

3 Table 5.1 Reliability / Item Analysis Results for Scale Items Measuring Functional / Psychological Aspects of Internet Banking Item No Description of Scale Items Item to Total Correlation Alpha if Deleted 1 Internet Banking services are fast to use Internet Banking services are easy to use Use of Internet Banking service is convenient Progress of Internet Banking service in the future is clear Internet banking makes it more easier for me to conduct financial transactions The use of Internet banking services is economical Internet banking provides an easier way for me to handling my financial matters compared to other means in banking 8 The use of Internet banking services increases my ability to control my financial matters by myself I fear that connections will be lost while using Internet banking services Printable receipt of the internet banking service is a provable output for payment I fear that while using a Internet banking service, I might tap out the information of the bill wrongly I trust that others are not able to use or see my account information while I am using my Internet banking service 13 Visiting the bank branch and chatting with teller is a nice occasion on a weekday I find self-service alternatives more pleasant than personal customer service Internet banking services are offering good option next to traditional banking services I have a very positive image of Internet banking services In my opinion, new technology is often too complicated to be useful I have such an image that Internet banking services are difficult to use Cronbach s Alpha Reliability Coefficient Source: Primary Data 96

4 5.2 Results and Discussion From the observation of the table, it is understood that item to total correlation, i.e., correlation of all 18 items with their total sum score varies from (Item 17) and (Item 7). This indicates that there have been sufficient positive correlation values of at least 0.30 for all items in the scale measuring functional / psychological barriers to e-banking and internet banking. As there is sufficient correlation between each item and total sum score, all these items in the scale are considered to be internally consistent with each other in measuring functional / psychological barriers to e-banking and internet banking and opinion data of these 18 items are valid items. It is further apparent from the table that the Cronbach s alpha reliability coefficient is , indicating that the degree of internal consistency among 18 items in the scale measuring functional / psychological barriers to e-banking and internet banking has been excellent. As the scale items measuring functional / psychological barriers to e-banking and internet banking are highly reliable and internally consistent, further analyses have been carried with collected data. After ascertaining the reliability of the items in the scale measuring functional / psychological barriers to e-banking and internet banking, the underlying dimensions of functional / psychological barriers to e-banking and internet banking are evaluated using principle component factor analysis with Varimax rotation. The results of factor analysis, such as eigen value and explained variance of each factor are reported in Table 5.2 and factor loadings of each item with valid factors are shown in Table

5 Table 5.2 Eigen values of Factors Underlying Functional / Psychological Aspects of Internet Banking [IB] Factors Eigen value % of Total Variance Cumulative % of Total Variance Source: Primary Data As shown in Table 5.2, the initial eigen values, that is eigen values before Varimax rotation, for first four factors are above one, indicating these are major aspects underlying functional / psychological barriers to e-banking and internet banking. The eigen value for first, second, third and fourth is 6.79, 3.35, 1.59 and 1.09 respectively, in turn revealing that the explained variance by first, second, third and fourth factor is per cent, per cent, 8.84 per cent 98

6 and 6.07 per cent in the original data before Varimax rotation respectively. All these four factors together explain per cent of the variances in the actual data pertaining to functional / psychological barriers to e-banking and internet banking. Figure 5.1 exhibits extractable factors, i.e., factors with eigen value above 1 visually using Scree plot. Chart 5.1 Eigen values of Factors Underlying Functional / Psychological Aspects of Internet Banking [IB] In the above Scree plot the mountain point ends at eigen value 1, which is also coinciding with Kaiser Criterion. Hence, it is undoubtedly concluded that there are four major functional and psychological barriers for adoption of e-banking / internet banking. 99

7 Table 5.3 presents the factor loadings of each item on four valid factors of functional and psychological barriers for adoption of e-banking / internet banking after varimax rotation. A perusal of factor loadings reveals that the eigen values of valid factors after varimax rotation have changed to 4.98, 2.55, 3.01, 2.28 and at the same time leaving the total explained variance in the actual data as much as before rotation (71.20 per cent). After rotation, the first factor explains per cent of the variation in the data. Similarly, the explained variance by second, third and fourth factor is per cent, per cent and per cent respectively. Further perusal of the table shows that the items 2 (0.87) and 3 (0.87) followed by items 7 (0.83), 5 (0.79), 6 (0.75), 1 (0.70) and 8 (0.70) are highly loaded with first factor. Similarly the second factor is highly correlated with items 17 (0.92), 18 (0.83) and 9 (0.81), third factor with items 15 (0.84), 16 (0.80), 4 (0.76), 12 (0.59) and 14 (0.54) and 4 (0.76), and fourth factor have high loadings with items 11 (0.81), 10 (68) and 13 (68) compared to factor loadings of respective items with other remaining factors. 100

8 Table 5.3 Factor Loadings of Items with Extracted Factors (After Varimax Rotation) Item No Description of Scale Items Factor Internet Banking services are easy to use Use of Internet Banking service is convenient Internet banking provides an easier way for me to handling my financial matters compared to other means in banking Internet banking makes it more easier for me to conduct financial transactions The use of Internet banking services is economical Internet Banking services are fast to use The use of Internet banking services increases my ability to control my financial matters by myself In my opinion, new technology is often too complicated to be useful I have such an image that Internet banking services are difficult to use I fear that connections will be lost while using Internet banking services Internet banking services are offering good option next to traditional banking services I have a very positive image of Internet banking services Progress of Internet Banking service in the future is clear I trust that others are not able to use or see my account information while I am using my Internet banking service I find self-service alternatives more pleasant than personal customer service I fear that while using a Internet banking service, I might tap out the information of the bill wrongly Printable receipt of the internet banking service is a provable output for payment Visiting the bank branch and chatting with teller is a nice occasion on a weekday Explained Variance % of Total Variance Cumulative % of Total Variance Factor Label Convenient & Easy to Use Complications and Difficulties in using IB initially good option next to traditional banking risk of getting wrong information Source: Primary Data 101

9 From item s highest loading with each factor, it is understood that the first factor is highly characterized by easy to use and convenient. Similarly second, third and fourth factors possess the maximum characteristics of complications with new technology, difficulties in using and fear of losing network connections, IB is good option next to traditional banking and positive image of internet banking services and fear of tapping out the information wrongly while using internet banking services respectively. Therefore, the first factor is identified as convenient and easy to use, second factor as Complications and Difficulties in using IB initially, third factor as good option next to traditional banking and fourth factor is labeled with the risk of getting wrong information The scores for each extracted factors are calculated by averaging the scores of items in that factor. The scores thus obtained are used in the subsequent analysis. As the opinion of each respondent against each item in the scale is measured using 7 point Likert type scale ranging from 1 for Very Strongly Disagree to 7 for Very Strongly Agree, the opinion of a respondent group is considered to be as Very Strongly Disagree, Strongly Disagree, Disagree, Neutral, Agree, Strongly Agree, Very Strongly Agree for mean score of < 1.50, >= 1.50 and < 2.50, >= 2.50 and < 3.50, >=3.50 and < 4.50, >= 4.50 and < 5.50, >= 5.50 and < 6.50 and >= 6.50 respectively. Then functional / psychological barriers (four dimensions) for e-banking / internet banking are compared across the respondent groups by socio-economic characteristics in order to ascertain whether barriers for e-banking / internet 102

10 banking are associated with these characteristics or not. The difference in opinion about four different functional / psychological barriers between those who have availed of and those who have not availed of the e-banking / internet banking is also compared to empirically identify the barriers for not availing services among bank customers. To compare the opinion between two groups and more than two groups, independent sample t-test and one way Analysis of Variance have been used respectively. The results of the analysis are tabulated and discussed in the remaining part of this chapter. 5.3 Functional / Psychological Barriers Vs Socio-Economic Characteristics The relationship between functional / psychological barriers pertaining to Convenient & Easy to Use, Complications and Difficulties in using new technology like IB initially, IB as Good option next to traditional banking and Risk of getting wrong information and socio-economic characteristics such as location, sex, age, education, occupation and income are analysed here. The difference in barriers of internet banking between public and private sector banks customers is also tested. The opinion of the rural, semi-urban and urban groups about four major barriers of IB is compared and significance of the difference in opinion is tested with one-way ANOVA. The results of the analysis are reported in Table

11 Table 5.4 Functional / Psychological Aspects of Internet Banking Comparison of Opinion across Respondent Groups by Location Q. No Functional / Psychological Aspects of Internet Banking[IB] Rural Location Semiurban Urban (n=161) (n=80) (n=119) F value 1 Convenient & Easy to Use 2 Complications and Difficulties in using IB initially *** (1.43) (1.16) (1.20) ** (1.56) (1.21) (1.70) 3 4 Good option next to *** traditional banking (1.23) (1.04) (0.94) Risk of getting wrong *** information (1.41) (0.90) (1.41) Source: Primary Data. Figures in brackets are standard deviation. **Significant at 5% level; ***Significant at 1% level. From the examination of the table, it is apparent that the opinion of the rural group is in the Neutral range (4.27), that of semi-urban (4.83) and urban (4.81) groups, it has been in Agree range against Convenient & Easy to use. The scenario is similar in terms of Risk of getting wrong information across locations. However, the respondent groups from all locations have agreed that use of new technology like internet banking is complicated and difficult initially but it is good option next to traditional banking. The F values, 7.89 (p < 0.01) for Convenient & Easy to Use, 2.97 (p < 0.05) for Complications and Difficulties in using IB initially, 104

12 8.31 (p < 0.01) for Good option next to traditional banking and 9.35 (p < 0.01) for Risk of getting wrong information for the difference in group means are significant for all barrier dimensions. This indicates that functional / psychological barriers of internet banking differ across locations. To sum up, it is found that the respondents from rural, semi-urban and urban areas have seen the e-banking / internet banking as convenient and easy to use and as a good option next to traditional banking but they have perceived that use of new technology like internet banking is initially complicated and difficult as well as it may lead to giving wrong information. The functional / psychological aspects of barriers in adoption of e-banking / internet banking are compared between customer groups of public and private sector banks with independent sample t-test and the results of the test are reported in Table 5.5. According to the table, the bank customers of public sector banks have neither agreed nor disagreed (4.34) whereas those of private sectors (5.09) have agreed with convenient and easy to use. At the same time both public and private sector bank customer groups have agreed with all other three dimensions of functional / psychological barriers of e-banking / internet banking. 105

13 Table 5.5 Functional / Psychological Aspects of Internet Banking Comparison of Opinion across Respondent Groups by Banking Sector Q. No Functional / Psychological Aspects of Internet Banking[IB] Banking Sector Public Private (n=247) (n=113) t value 1 Convenient & Easy to Use 2 Complications and Difficulties in using IB initially *** (1.42) (0.92) (1.57) (1.51) 3 4 Good option next to *** traditional banking (1.16) (0.78) Risk of getting wrong information (1.38) (1.26) Source: Primary Data. Figures in brackets are standard deviation. ***Significant at 1% level. The t-value for the difference in opinion between public and private sector groups is significant only for Convenient & Easy to Use (t = 5.16, p < 0.01) and Good option next to traditional banking (t = 6.99, p < 0.01). Hence, from the analysis, it is found that the level of convenience and easy to use of IB as well as perceiving IB as good option next to traditional banking is significantly less among public sector bank customers when compared to their private sector counterparts. It is further observed that IB is complicated, difficult initially and giving wrong information are the barriers for both public and private sector bank customers. 106

14 Table 5.6 portrays the results of comparative analysis of opinion across respondent groups by age. Table 5.6 Functional / Psychological Aspects of Internet Banking Comparison of Opinion across Respondent Groups by Age Q. No Functional / Psychological Aspects of Internet Banking Age (in Years) Up to Above 40 (n=87) (n=216) (n=57) F value 1 Convenient & Easy to Use 2 3 Complications and Difficulties in using IB initially ** (0.96) (1.38) (1.55) *** (1.33) (1.69) (1.04) Good option next to *** traditional banking (0.78) (1.20) (0.85) 4 Risk of getting wrong ** information (1.33) (1.41) (1.03) Source: Primary Data. Figures in brackets are standard deviation. **Significant at 5% level; ***Significant at 1% level. It can be seen from the table 5.6 that the IB is neither convenient and easy nor inconvenient and difficult for bank customers aged between years and above 40 years as mean scores are in Neutral range (>= 3.50 and < 4.50). At the same time, IB is convenient and easy to use for younger groups (age up to 25 years). The F value, 3.57 for the difference in group means is also significant at 5 per cent level for the above factor. For all age groups against all other three remaining barrier factors, the mean scores are very well in the agree range. 107

15 However, the F value for Complications and Difficulties in using IB initially (F = 6.94, p < 0.01), Good option next to traditional banking (F = 22.09, p < 0.01) and Risk of getting wrong information (F = 3.62, p < 0.05) is significant. In short, it is concluded that IB is good option to traditional banking but there has been complications, difficulties in using new technology like IB initially as well as risk of getting wrong information through IB for bank customers of all age groups. At the same time, there is significant association between functional / psychological barriers in adoption of e-banking / internet banking and age of the bank customers. The difference in opinion about functional / psychological aspects of barriers in adoption of e-banking / internet banking across the respondent groups by educational status is evaluated. Table 5.7 presents the results of the analysis. Q. No Table 5.7 Functional / Psychological Aspects of Internet Banking Comparison of Opinion across Respondent Groups by Education Functional / Psychological Aspects of Internet Banking 1 Convenient & Easy to Use Complications and Difficulties in using IB initially Secondary Education Degree Above Degree (n=42) (n=145) (n=173) F value (1.18) (1.11) (1.52) (1.23) (1.23) (1.82) Good option next to ** traditional banking (1.06) (1.05) (1.17) Risk of getting wrong ** information (1.18) (1.31) (1.39) 108

16 Source: Primary Data. Figures in brackets are standard deviation. **Significant at 5% level It can be seen from the table that the secondary educated bank customers have neither disagreed nor agreed with Convenient & Easy to Use and Risk of getting wrong information (Mean Score >= 3.50 and < 4.50), and agreed with Complications and Difficulties in using IB initially and Good option next to traditional banking (Mean Score >= 4.50 and < 5.50). While agreement among degree holders can be seen in respect of all functional / psychological barrier dimensions, the bank customers with education beyond degree have neither disagreed nor agreed with Risk of getting wrong information and agreed with remaining dimensions. However, the three educational group of bank customers differ significantly in their level of agreement with Good option next to traditional banking (F value = 4.22, p < 0.05) and Risk of getting wrong information (F value = 4.04, p < 0.05). From the inferences, it is found that the bank customers irrespective of their educational status have agreed that IB is convenient and easy to use but using it initially is difficult and complicated. The bank customers of all educational status have also agreed that IB is good option next to traditional banks and to the risk of getting wrong information but there is significant difference in the level of agreement by educational status. Table 5.8 presents the results of F test comparing the opinion about Functional / psychological barriers in Internet banking across bank customers groups based on occupation. 109

17 Table 5.8 Functional / Psychological Aspects of Internet Banking Comparison of Opinion across Respondent Groups by Occupation Q. No Functional / Psychological Aspects of Internet Banking Student Housewife Occupation Govt. Employee Private Employee Business / Self Employed F value (n=55) (n=18) (n=136) (n=120) (n=31) Convenient & Easy *** to Use (1.03) (1.14) (1.31) (1.50) (0.89) Complications and Difficulties in using IB initially Good option next to traditional banking *** (1.32) (0.72) (1.48) (1.84) (0.87) *** (0.65) (0.58) (1.00) (1.29) (1.06) Risk of getting wrong information (1.47) (1.79) (1.08) (1.53) (1.11) Source: Primary Data. Figures in brackets are standard deviation. ***Significant at 1% level According to the table, Students, housewives and Business / self employed bank customer groups have agreed with all the dimensions of functional / psychological barriers and benefits as the mean perception scores are in the agree range (>= 4.50 and <5.50). On the other hand, bank customers working as Government employee have agreed with all the dimensions except Convenient & Easy to Use, whereas the bank customer group with employment in private organization have agreed with two dimensions, namely Complications and Difficulties in using IB initially and Good option next to traditional banking. 110

18 The F value for the difference in group mean perception scores are significant for Convenient & Easy to Use (F value = 4.28, p < 0.01), Complications and Difficulties in using IB initially (F value = 3.78, p < 0.01) and Good option next to traditional banking (F value = 13.19, p < 0.01). Hence, it is concluded that there is significant difference in the perceived status of functional / psychological barrier Complications and Difficulties in using IB initially and benefits like Convenient & Easy to Use and Good option next to traditional banking across respondent categories by occupation. But, risk of getting wrong information is perceived to be at the same extent across all occupational groups. Table 5.9 reports the results of comparative analysis of bank customers perception about five different aspects of Functional / psychological benefits and barriers in internet banking. From the perusal of the table, it is understood that the level of agreement of bank customers group with monthly income up to Rs (Mean = 4.10 neutral range) is significantly less compared to that of those in the groups with monthly income between Rs and above Rs (Mean = 4.62 & 5.13 in the agree range respectively) (F value = 16.77, p < 0.01) with regard to Convenient & Easy to Use of internet banking. Similar scenario as above is visible in respect of Good option next to traditional banking (F value = 30.29, p < 0.01) and Risk of getting wrong information (F value = 14.14, p < 0.01). 111

19 Table 5.9 Functional / Psychological Aspects of Internet Banking Comparison of Opinion across Respondent Groups by Income Q. No Functional / Psychological Aspects of Internet Banking Up to Rs Income Rs > Rs (n=119) (n=154) (n=87) F value 1 Convenient & Easy to Use *** (1.36) (1.25) (1.18) 2 Complications and Difficulties in using IB initially (1.63) (1.56) (1.38) 3 4 Good option next to *** traditional banking (1.38) (0.86) (0.76) Risk of getting wrong *** information (1.34) (1.45) (0.91) Source: Primary Data. Figures in brackets are standard deviation. ***Significant at 1% level At the same time, the bank customers belonging to all three income groups have agreed that using internet banking initially is complicated and difficult, and the level of their agreement in this regard is independent of their income (F value = 1.87, not significant, indicating that there is no remarkable difference in group mean perception scores). On the whole from the results, it is inferred that functional and psychological benefits of IB like convenient and easy to use, good option next to traditional banking and barriers such as risk of getting wrong information is significantly less among low income group of bank customers than that of those in the groups with medium and high income. It is further concluded that there is no remarkable difference in the functional and psychological barrier, complications and difficulties in using IB initially among bank customer groups with low, medium and high income level. 112

20 The functional / psychological benefits and barriers in using IB is compared with two respondent groups with respect to important and unimportant opinion about ATM usage using t-test and the results of the test are shown in Table Table 5.10 Functional / Psychological Aspects of Internet Banking Comparison of Opinion across Respondent Groups by Importance of ATM Usage Q. No Functional / Psychological Aspects of Internet Banking 1 Convenient & Easy to Use 2 3 Complications and Difficulties in using IB initially ATM Usage Important Unimportant (n=349) (n=11) t value *** (1.31) (1.41) ** (1.55) (1.10) Good option next to * traditional banking (1.13) (0.70) 4 Risk of getting wrong information (1.35) (1.19) Source: Primary Data. Figures in brackets are standard deviation. *Significant at 10% level; **Significant at 5% level ***Significant at 1% level An observation of the table shows that the mean perception of the respondent group with ATM usage as unimportant is in the neutral range (>= 3.50 and < 4.50) and significantly less than that of those in the group with ATM usage as important in respect of Convenient & Easy to Use (Mean = 4.61, in agree range) (t value = 2.70, p < 0.01) and Good option next to traditional banking (Mean = 4.93, in agree range) (t value = 1.72, p < 0.10). On the other hand, the opinion of the respondent group with unimportant, which is 113

21 in the strongly agree range (Mean = 5.76) is significantly higher than the opinion of the respondent group with important (Mean = 4.76, agree level) about ATM usage (t-value = 2.11, p < 0.05). From the entire above results, it is found that perceived status of the bank customers who consider the ATM usage as unimportant is significantly less in respect of functional benefit such as Convenient & Easy to Use and Good option next to traditional banking whereas it is significantly higher with regard to functional barrier, Complications and Difficulties in using IB initially. It is further found that perceived Risk of getting wrong information from IB has been similar for both respondent groups with ATM usage as important and unimportant. Table 5.11 provides the results of t-test comparing the opinion about functional / psychological barriers and benefits between respondent group with Tele-banking as important and unimportant. It is evident from the table that the mean perception is more towards Convenient & Easy to Use (Mean = 4.67) whereas it is less in respect of Complications and Difficulties in using IB initially (Mean = 4.75), Good option next to traditional banking (Mean = 4.90) and Risk of getting wrong information (Mean = 4.53) for those who consider the Tele banking as important compared to mean perception of those who consider the Tele-banking as unimportant. 114

22 Table 5.11 Functional / Psychological Aspects of Internet Banking Comparison of Opinion across Respondent Groups by Importance of Tele-Banking Q. No Functional / Psychological Aspects of Internet Banking Tele Banking Important Unimportant (n=186) (n=174) t value 1 Convenient & Easy to Use 2 Complications and Difficulties in using IB initially (1.45) (1.18) (1.68) (1.40) 3 4 Good option next to traditional banking (1.06) (1.19) Risk of getting wrong information (1.48) (1.19) Source: Primary Data. Figures in brackets are standard deviation. However, it is apparent that t-value for the difference between groups mean perception score is insignificant for all dimensions of functional and psychological barriers / benefits of internet banking. Based on this outcome, it is concluded that the extent of Convenient & Easy to Use, Complications and Difficulties in using IB initially, Good option next to traditional banking and Risk of getting wrong information is same and independent of the status of importance of Tele-banking among bank customers. The relationship between functional and psychological barriers / benefits and importance of internet banking is evaluated using t-test and the results of the test are presented in Table

23 Table 5.12 Functional / Psychological Aspects of Internet Banking Comparison of Opinion across Respondent Groups by Importance of Internet Banking Q. No Functional / Psychological Aspects of Internet Banking Internet Banking Important Unimportant (n=283) (n=107) t value 1 Convenient & Easy to Use *** (1.33) (1.19) 2 Complications and Difficulties in using IB initially ** (1.53) (1.55) 3 4 Good option next to *** traditional banking (1.13) (1.06) Risk of getting wrong information (1.35) (1.34) Source: Primary Data. Figures in brackets are standard deviation. **Significant at 5% level ***Significant at 1% level. From the perusal of the table, it is understood that the mean perception scores of those respondent who consider the internet banking as important regarding all four dimensions of functional / psychological aspects of IB are in the agree range (>=4.50 and < 5.50). For respondent group who consider the internet banking as unimportant, the mean perception score is in the neither disagree nor agree range (>= 3.50 and 4.50) in respect of Convenient & Easy to Use and in the agree range for the remaining aspects (>= 4.50 and 5.50). Moreover, the mean perception scores against all four functional / psychological aspects (barriers / benefits) of respondents who consider the internet banking as unimportant is less than that of those who consider the internet banking as important. 116

24 The difference in the mean perception scores is significant in respect of Convenient and Easy to Use (t-value = 4.78, p < 0.01), Complications and Difficulties in using IB initially (t-value = 2.26, p < 0.05) and Good option next to traditional banking (t-value = 3.16, p < 0.01). From the above results, it is found that there is significant relationship between functional / psychological barriers / benefits and importance of Internet banking among bank customers. The opinion about functional / psychological barriers / benefits of internet banking is compared between respondent groups with manual and e-banking in order to ascertain whether functional / psychological barriers / benefits of internet banking is related to type of banking and the results of the analysis are given in Table As shown in the table, the respondents with manual banking perceive the internet banking as less convenient and less easy to use (Mean = 4.29) and more complications and difficulties in using IB (Mean = 5.09) as well as risk of getting wrong information from IB (Mean = 4.74) compared to that of those with e-banking (Mean values are less for e-banking group compared to that of manual banking group). 117

25 Table 5.13 Functional / Psychological Aspects of Internet Banking Comparison of Opinion across Respondent Groups by Preferred Type of Banking Q. No Functional / Psychological Aspects of Internet Banking Type of Banking Manual e-banking (n=189) (n=171) t value 1 Convenient & Easy to Use 2 Complications and Difficulties in using IB initially *** (1.44) (1.11) *** (1.43) (1.61) 3 4 Good option next to traditional banking (1.14) (1.10) Risk of getting wrong * information (1.40) (1.28) Source: Primary Data. Figures in brackets are standard deviation. *Significant at 10% level; ***Significant at 1% level While the level of agreement regarding Good option next to traditional banking is similar for both types of banking groups, it differs significantly between the two groups in respect of Convenient & Easy to Use (t-value = 4.42, p < 0.01), Complications and Difficulties in using IB initially (t-value = 3.84, p < 0.01) and Risk of getting wrong information (t-value = 1.89, p < 0.10). In short, it is concluded that the perceived status of functional / psychological barrier is high and benefit is less among manual banking customers when compared to that of those with e-banking. Table 5.14 presents t-test results comparing the opinion about functional / psychological barriers and benefits of internet banking between bank customer groups with and without adoption of e-banking services. 118

26 Table 5.14 Functional / Psychological Aspects of Internet Banking Comparison of Opinion across Respondent Groups by Adoption of e-banking Q. No Functional / Psychological Aspects of Internet Banking Adoption of e-banking Yes No (n=229) (n=131) t value 1 Convenient & Easy to Use *** (0.93) (1.40) 2 Complications and Difficulties in using IB initially (1.51) (1.61) 3 4 Good option next to *** traditional banking (0.95) (1.21) Risk of getting wrong *** information (1.24) (1.44) Source: Primary Data. Figures in brackets are standard deviation. *Significant at 10% level; ***Significant at 1% level It can be observed from the table that mean scores of respondent group with adoption of e-banking are in the agree range (>= 4.50 and 5.50) with regard to Convenient & Easy to Use (Mean = 5.11), Complications and Difficulties in using IB initially (Mean = 4.74), Good option next to traditional banking (Mean = 5.21) and Risk of getting wrong information (Mean = 4.85). On the other hand, the bank customer group without e-banking adoption have neither disagreed nor agreed with all dimensions (Mean scores are >= 3.50 and < 4.50, in neutral range) except with Complications and Difficulties in using IB initially (Mean = 4.88, in agree range). 119

27 The t value for the difference in group mean perception scores is also significant at 1 per cent level for Convenient & Easy to Use (t-value = 12.07, p < 0.01), Good option next to traditional banking (t-value = 7.03, p < 0.01) and Risk of getting wrong information (t-value = 4.50, p < 0.01). Hence from the overall results, it is deduced that there is significant difference in the perceived status of all functional / psychological barrier and benefit except Complications and Difficulties in using IB initially between bank customer groups with and without adoption of e-banking. The opinion about benefits and barriers pertaining to functional / psychological aspects of internet banking is compared across three respondent groups based on period of using e-banking in order to find out whether there is any association between perceived status of functional / psychological barrier / benefits and e-banking usage period. The comparison of mean opinion across groups is carried with the help of F-test and the results of the test are presented in Table

28 Table 5.15 Functional / Psychological Aspects of Internet Banking Comparison of Opinion across Respondent Groups by Period of Using e-banking Period of Using e-banking (N = 229) Q. No Functional / Psychological Aspects < 1 Year 1-3 years > 3 years F value (n=64) (n=106) (n=59) 1 Convenient & Easy to Use 2 Complications and Difficulties in using IB initially *** (0.84) (0.77) (1.13) ** (1.44) (1.64) (1.27) 3 4 Good option next to *** traditional banking (0.82) (0.84) (1.17) Risk of getting wrong information (1.33) (1.14) (1.31) Source: Primary Data. Figures in brackets are standard deviation. **Significant at 5% level; ***Significant at 1% level According to the table, mean opinion scores ranges between 4.53 and 4.99, 4.65 and 5.33, and between 4.92 and 5.48 for respondent group with period of using e-banking for below one year, 1-3 years and above three years in respect of all functional / psychological barriers/benefits dimensions respectively. From the mean perception scores, it is apparent that all three respondent groups have expressed their agreement with all dimensions of functional / psychological barriers / benefits. However, the F value of 9.53 (p < 0.01) for Convenient & Easy to Use, 3.02 (p < 0.05) for Complications and Difficulties in using IB initially and 121

29 5.66 (p < 0.01) for Good option next to traditional banking is significant. Regarding Risk of getting wrong information, the F value is insignificant. On the whole, it is found that functional / psychological barriers and benefits in internet banking are significantly related to period of using e-banking among bank customers. Table 5.16 reports the results of F-test statistics comparing the opinion of the respondents across categories by number of times visiting the bank. Table 5.16 Functional / Psychological Aspects of Internet Banking Comparison of Opinion across Respondent Groups by Number of Times Visiting Bank / Month Q. No Functional / Psychological Aspects 1 Convenient & Easy to Use Complications and Difficulties in using IB initially Number of Times Visiting Bank Up to 5 Times 6-10 Times > 10 Times (n=280) (n=52) (n=28) F value *** (1.22) (1.55) (1.58) *** (1.47) (1.77) (0.62) Good option next to *** traditional banking (1.01) (1.46) (1.15) Risk of getting wrong *** information (1.28) (1.59) (1.02) Source: Primary Data. Figures in brackets are standard deviation. ***Significant at 1% level 122

30 An examination of the table indicates that there has been an agreement among respondent group with number of times visiting the bank up to 5 times per month pertaining to all aspects of functional / psychological barriers and benefits (Mean scores, which range between 4.51 and 4.93, are in agree range). While the respondent group with monthly visit of 6-10 times to the bank have neither disagreed nor agreed (Mean scores are in between 3.50 and 4.50, the range for neutral ), those with monthly visit of more than 10 times have strongly disagreed with three aspects (Mean perception scores are between 5.50 and 6.50, the strongly agree range) whereas with respect to Convenient & Easy to Use, it has been in agree range (Mean = 5.47). The F value obtained for the difference in group mean perception scores is significant at 1 per cent level for all aspects, in turn revealing the fact that the functional / psychological barriers and benefits are significantly associated with number of times visiting the bank / month among bank customers. Table 5.17 presents the results of F-test comparing the opinion of respondents about functional / psychological aspects pertaining to barriers and benefits in adoption of internet banking across their categories based on the number of internet banking transactions per week. It can be seen from the table that the respondent group without any IB transaction tend to neither disagree nor agree with all dimensions (Mean scores are in neutral range - >= 3.50 and < 4.50) except Complications and Difficulties in using IB initially with which this group have expressed an agreement (Mean = 4.87). 123

31 Table 5.17 Functional / Psychological Aspects of Internet Banking Comparison of Opinion across Respondent Groups by Number of Internet Banking Transactions / Week Q. No 1 Functional / Psychological Aspects Number of IB Transactions Not at all Only once 2-3 times > 3 times (n=142) (n=118) (n=69) (n=31) F value Convenient & Easy to *** Use (1.30) (1.11) (1.27) (0.72) Complications and Difficulties in using IB initially *** (1.37) (1.70) (1.48) (1.44) Good option next to *** traditional banking (1.24) (0.87) (0.98) (0.93) Risk of getting wrong *** information (1.42) (1.24) (1.29) (1.10) Source: Primary Data. Figures in brackets are standard deviation. ***Significant at 1% level On the other hand, the respondents with IB transactions only once in a week have agreed with all dimensions (Mean scores are between 4.50 and 5.50, in the agree range) except Complications and Difficulties in using IB initially with which this group of respondents have been neutral (Mean = 4.35). However, the respondent group with number of IB transactions between 2-3 times and above 3 times have agreed with all four dimensions of functional / psychological aspects pertaining to barriers / benefits of internet banking (Mean scores are >= 4.50 and < 5.50, the range for agree ). Moreover F value of 29.09, 6.21, and 7.53 for Convenient & Easy to Use, Complications and Difficulties in using IB initially, Good option 124

32 next to traditional banking and Risk of getting wrong information are significant at 1 per cent level respectively. From the above results, it is found that the functional / psychological barriers and benefits in adoption of internet banking is significantly determined by the number of internet banking transactions in a week among bank customers. The influence of number of monthly banking transactions on functional / psychological barriers and benefits in adoption of internet banking among bank customers are evaluated using F-test and the results of the analysis are shown in Table Table 5.18 Functional / Psychological Aspects of Internet Banking Comparison of Opinion across Respondent Groups by Number of Banking Transactions / Month Q. No Functional / Psychological Aspects Up to 5 times Number of Banking Transactions 6-10 Times >10 Times F value (n=165) (n=126) (n=69) 1 Convenient & Easy to Use (1.31) (1.20) (1.55) 2 Complications and Difficulties in using IB initially *** (1.37) (1.67) (1.55) 3 4 Good option next to ** traditional banking (1.19) (0.93) (1.24) Risk of getting wrong information (1.37) (1.29) (1.37) Source: Primary Data. Figures in brackets are standard deviation. **Significant at 5% level; ***Significant at 1% level 125

33 As shown in the table, the mean perception of the respondent group with number of banking transaction up to 5 times per month is neutral level whereas that of other respondent groups is in the agree level in respect of convenient & Easy of use. But from the F value of 1.99, which is insignificant, it is apparent that the above difference in the level of opinion is due to chance alone and not at mentionable level. On the other hand, the respondent group with number of banking transactions up to 5 years (Mean = 5.06) and above 10 years (Mean = 4.97) have not shown much interest in the adoption of IB as they felt that using IB initially is more complicated and difficult (Mean scores are in agree range) and differ significantly in this regard from respondent group with number of banking transaction between 6-10 times per month (Mean = 4.35) (F value = 8.57, p < 0.01). The scenario is very similar as above in the case of Risk of getting wrong information (Mean scores are in agree range for all three groups), but the F value is insignificant in turn revealing that the perceived risk of getting wrong information from using IB is independent of the number of banking transactions. At the same time, all three respondent groups have agreed that adoption of internet banking is a good option next to traditional banking, but their level of agreement in this regard differ significantly by number of banking transactions (F value = 3.67, p < 0.05). From the above results it is found that Complications and Difficulties in using IB initially and perceiving the adoption of IB as Good option next to traditional banking is significantly influenced by the number of banking transactions per month while other two 126

34 dimensions of functional barriers Risk of getting wrong information and benefits Convenient & Easy to Use is independent of the number of monthly banking transaction among bank customers. 5.4 Determinants of Functional/Psychological Barriers / Benefits in Internet Banking Adoption In the previous part of this chapter, respondents perception about four dimensions of functional / psychological barriers and benefits are compared across their categories by socio-economic characteristics and banking habits to know whether there has been consistency in expressing opinion about barriers and benefits to come to irrefutable conclusion. Here, in this part, an attempt is made to identify the socio-economic and banking habit related factors that have unique influence on perceived functional / psychological barriers and benefits in Internet banking adoption using multiple regression technique. In the regression analysis, the dependent variable is each dimension of functional / psychological barriers and benefits and independent variables are socio economic and banking related characteristics. The regression results for Convenient and easy to use are given in Table

35 Table 5.19 Multiple Regression Results for Convenient and Easy of Use with Socio- Economic Characteristics, Internet Banking and Banking Habits Independent Variable Regression Equation First Second Third Intercept *** *** *** (9.13) (12.32) (12.62) Sex * ** ** (1.88) (2.07) (2.04) Age (0.72) Location *** *** *** (3.02) (2.87) (2.66) Educational Level (0.84) -(1.16) Occupation * ** ** -(1.89) -(2.35) -(2.50) Monthly Income *** *** *** (2.86) (2.83) (2.64) Importance of ATM Usage (1 important; 2 unimportant) -(1.16) Importance of Tele banking (1 important; 2 unimportant) (0.32) Importance of Internet Banking * (1 important; 2 unimportant) -(1.51) -(1.84) -(1.56) Preferred type of banking (1 manual; 2 e-banking) -(0.30) No. of Monthly bank visits *** *** *** -(6.89) -(7.25) -(7.58) No. of Internet Banking / week (0.31) E-banking adoption *** *** *** (1 Yes ; 2 No) (3.44) (4.20) (4.13) No. of Monthly Bank Transactions (1.00) R Square Adjusted R Square F Value 15.77*** 27.48*** 31.18*** (Degrees of Freedom) (14, 345) (8, 351) (7, 352) Source: Primary Data. Figures in brackets are standard deviation. *Significant at 10% level; **Significant at 5% level; ***Significant at 1% level 128

36 It is evident from the table that there are three regression results. The first equation is run with all independent variables, while second and third regressions are with most important independent variables after dropping least significant independent variables in first and second equations step by step. The stepwise approach is adopted to get the model of best fit. The model of best fit is identified based on the adjusted R 2 value. A model with highest R 2 value is identified as the model of best fit and the independent variables in the best fitted model are considered to be the important factors that have unique influence (determinant power) on dependent variables (here functional / psychological barrier and benefit). From the observation of the results of the first equation, it is understood that all three regression models are fitted significantly at 1 per cent level (R 2 = , and with F values 15.77, and which are significant at one percent level respectively). The first model with all selected independent variable could explain per cent with adjusting for degrees of freedom and per cent after adjusting for degrees of freedom in the perceived convenient and easy to use of IB. In the first model, from the coefficient of individual independent variable, it is apparent that sex, location, monthly income and e-banking adoption have significant unique positive influence while occupation and number of monthly bank visits have significant unique negative influence on perceived convenient and easy to use of IB. There are many independent variables with insignificant coefficient in the first model. Therefore, second model, after dropping few independent variables with very least coefficients, was run. 129