ELECTRONIC BANKING CHALLENGES IN INDIA: AN EMPIRICAL INVESTIGATION

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1 Abstract ELECTRONIC BANKING CHALLENGES IN INDIA: AN EMPIRICAL INVESTIGATION Majid Karimzadeh*(Correspondent Author) Economics department, Aligarh Muslim University, Aligarh, UP, India. Postal address: 4/1121, Sir Syed Nagar, Aligarh, , Uttar pradash, India. Dastgir Alam Economics department, Aligarh Muslim University, Aligarh, UP,India. Increased competition, changing business environments, globalization and the advancement of Information and Communications Technology are the important factors that have forced Banking and Financial services to change. Demand for financial services is changing rapidly and customer behavior regarding these services is also adapting rapidly. Therefore, with the passing of the traditional banking sector to electronic banking, new strategies have become necessary in order to attract and retain existing customers. Despite enormous pressures for change and investment in Information Technology in the Banking field, if these investments do not work in accordance with the principles of investment, they will fail. This investigation will review available sources and studies conducted in this field, and seek to find out the main factors and challenges posed in the development of electronic banking after a relatively long period of adoption in India. This paper provides a possible six factor model centered upon the following: infrastructure, knowledge, legal-security, socio-cultural, economic and management and banking issues. The results of the study indicate that legal and security, socio-cultural, and management and banking issues are accepted as challenges for the development of e-banking but that there is less awareness regarding new technologies and unsuitable software which are ranked respectively as the highest and lowest obstacles in India. Keywords: E-banking, challenges and obstacles, development and ranking. 1. Introduction The nearly universal connectivity which the Internet offers has made IT an invaluable business tool. These developments have created a new type of economy, which may be called the digital economy. This fast emerging economy is bringing with it rapidly changing technologies, increasing knowledge intensity in all areas of business and creating virtual supply chains and new forms of businesses and service delivery channels such as e-banking [16]. The term e-banking has been used in literature in many different ways, partially because electronic banking refers to several types of services through which banks customers can request information and carry out most retail banking services via the internet, television or mobile phones. Generally speaking, E-banking means providing banking products and services directly to customers through electronic, interactive communication channels. However, a more comprehensive and common definition for e-banking comes from the Basel Committee Report on banking supervision. The Basel Committee defines e-banking as. The provision of retail and small value banking products and services through electronic channels, such products and services can include deposit taking, lending, account management,the provision of financial advice, electronic bill payment products and services such as electronic money [5]. Banking institutions have become an essential component of most economies whether they are described as engines for economic growth or as acting as conduits towards promoting economic growth [17]. There are not many inventions that have changed the business of banking as quickly as the e-banking revolution. World over banks are reorienting their business strategies towards new opportunities offered by e-banking. E-banking has enabled banks to scale borders, change strategic behavior and thus bring about new possibilities [12]. COPY RIGHT 2012 Institute of Interdisciplinary Business Research 31

2 E-banking and e-commerce are closely related systems with huge interactions and their development needs social identity, a reliable law system, well-built network, and powerful government support. Since there can be many potential problems, it is necessary to develop a sound atmosphere for e-banking. First, strengthen the construction of the network infrastructure; second, improve the risk prevention mechanism, and speed up the formulation of e-commerce-related standards and laws; third, boost the information development; fourth, nurture more practitioners in this area and finally strengthen communications with government for policy support [21]. The purpose of this research is to study and understand the challenges and obstacles which are affecting the development of e-banking in India and the ranking of them. This article also provides comparisons between the views of different groups of customers and staff regarding e-banking challenges. The findings of this research would be useful for policy makers and bank managers in the formulation of best practice in order to promote e- banking and also aid researchers in studies related to e-banking. 2. Literature review E-commerce literature has studied the phenomenon of e-banking from different perspectives. Some research has analyzed the adoption and growth of e-banking, whilst others describe the challenges and benefits to be gained from e-banking services as far as the organization is concerned. For the past two decades, the banking sector has chosen a new service channel based on the progress of information technology - the Internet- to respond to the changes in customer preferences and needs, increased competition from non-banks, changes in demographic and social trends, and government deregulations of the financial service sector [6]. The adoption of new IT applications is influenced largely by factors related to overall organizational attitudes and culture as well technical and infrastructural elements [15]. Aladwani [2] conducted research about the drivers and challenges of online banking; the results of the study show that top bank managers are in support of a lack of internet specialists and changes in Internet technology being the principle issues relevant to online banking development whereas IT managers mentioned time and budget constraints and also immature Internet technology. The study also indicates that according to general and IT managers technical obstacles are the most important challenge for the development of e-banking. Customers however mentioned internet security, online banking regulations and customers privacy as the most important future challenges of e-banking in Kuwait. Sathye [18] argued that, in the context of Internet banking, two kinds of price were accounted for; the normal costs associated with Internet activities, and the bank costs and charges which had a negative effect on the adoption of electronic banking everywhere. Rasoulian and Safari [14] carried out research concerning reasons as to why there was a lack of e-banking achievement; the result of the first chapter of their study showed the importance of Internet use, frameworks and encouraging policies to impress beneficiaries to use electronic banking. The second part introduced cultural elements as the most important challenge followed on by financial elements (the cost of the Internet and commissions) as the second influencing factor. The significance of technical elements is fading away according to their study due to improvements in the banking system. In addition their study highlighted other parameters such as management obstacles as also playing an important role in electronic banking. A study carried out by Daniel [7] concluded that the price of electronic services, increased competition due to new entrants, and trust can be future challenges for banking systems considering e-banking. Additional research was conducted by Khorshid and Ghaneh [10] and in their article on ranking the challenges of e-banking identified for managers of banks; customers privacy, security, and customers trust as issues arising. For customers; reputation of bank, regulations and laws, and easy accessibility were seen as the main challenges for the development of e-banking. Amadeh and Jafarpour [4] studied four groups of obstacles in a research titled The study of obstacles and strategies to improve electronic banking in the perspective of Iran These obstacles included sociocultural, managerial, financial and technical causes. The first two are accepted and the second two are rejected at the end of the study. Vaithianathan, S. [21] in his study comments that due to the high Internet penetration among developed countries populations, these countries are able to deploy electronic commerce to their advantage, whereas developing countries are still trailing far behind. Apart from this, other issues such as lack of technology infrastructure, lack of awareness, lack of skilled human resources, and the lack of government COPY RIGHT 2012 Institute of Interdisciplinary Business Research 32

3 initiatives, including various economic and social factors are cited as hurdles that prevent pervasive e-commerce adoption in developing countries. E-banking challenges and opportunities in Greece were researched by Angelakopoulos and Mihiotis [1]. The main findings demonstrate that banks expand to e-banking services in order to remain competitive, to keep track with technological developments and to benefit from the lower cost of e-banking transactions. The major problems they face are the low response rate from customers and the implementation of security and data protection mechanisms. The relatively low Internet usage, the non-familiarity with technologically advanced devices and problems regarding security and privacy are the main factors that have a negative influence on the adoption of e-banking services by customers in Greece. 3. Conceptual model and Hypotheses A qualitative assessment, using interviews with IT professionals of banks was performed and with the help and review of available studies in this field we conclude that effective factors for implementation and development of e-banking can be divided into two broad groups including soft and hard factors. Soft factors can be; culture, awareness, job and human relations, trust, resistance, coordination, and decision making etc. Hard factors include supporting soft factors with suitable technological and economic infrastructures, finance of network development and the preparation of software and hardware required of e-banking etc. Therefore, from all related factors we conclude that the barriers and challenges of electronic banking in India can be categorized into six main groups, including infrastructural barriers, knowledge barriers, legal and security issues, socio-cultural barriers, economic factors, and management and banking issues. After a review of concepts and the relevant literature pertaining to e-banking, research has been identified and organized following a conceptual model that includes all the different barriers to e-banking and has arranged these into six categories. The Hypotheses in this study include six assumptions: Table 1 Challenges and indicators of e-banking 1. Infrastructural barriers are one of the challenges for implementation and development of e-banking in India. 2. Knowledge barriers are one of the challenges for implementation and development of e-banking in India. 3. Legal and security issues are one of the challenges for implementation and development of e-banking in India. 4. Social and cultural barriers are one of the challenges for implementation and development of e-banking in India. 5. Economic factors are one of the challenges for implementation and development of e-banking in India. 6. Management and banking issues are one of the challenges for implementation and development of e- banking in India. 4. Methodology and Research Design One of the primary concerns of this paper is to identify the important parameters affecting the development of e- banking. To determine the dimensions of e-banking and its challenges, a questionnaire survey was conducted. The questionnaire consists of two parts. The first part comprises 6 questions concerning the demographic profile of the respondents and the second part consists of 36 questions in seven specific sections related to different challenges in order to explore the respondent s perceptions about the challenges and obstacles for development of e-banking in India. The questionnaire was first pre-tested amongst bank specialists so as to provide commentary on the relevance and wording of questionnaires items, length of survey and time taken to complete questions. The population of interest is defined as two groups including bank staff and electronic banking customers and they have been asked for their opinions. In total 200 questionnaires were filled out. The Cronbach s Alpha value was calculated for these questionnaires and it was equal to Appropriate statistical procedures for description and COPY RIGHT 2012 Institute of Interdisciplinary Business Research 33

4 inference were used. The correlation coefficients were calculated to evaluate the relationship between variables. Independent sample t- tests and one way ANOVA and post-hoc tests have been applied to compare the mean scores of different groups of educational attainment and job experience. A Friedman test was undertaken for ranking purposes. 5. Results and Discussion In order to find out the challenges of e-banking development, the hypotheses of the study are tested as follow: Table 2 Correlation analysis of challenges and e-banking development First hypothesis: Infrastructural barriers are one of the challenges for implementation and development of e- banking in India. Table 2 indicates that there is no correlation between infrastructural barriers and e-banking development. Therefore infrastructural barriers are not currently a challenge for the development of e-banking in India. Table 3 Impact of infrastructural barriers on e-banking according to variables In order to find out whether there is a difference of views between banks employees regarding the different challenges of e-banking, an ANOVA test has been used to show whether the level of education and age have any significant impact on the views of banks employees in India due to general perceptions that old and not so well educated employees have negative observations about e-banking services. Table 3 displays the different groups whom were compared with regard to infrastructural barriers, the results showed there is a meaningful significant difference at p< 0.05 between staff views of different job experiences. Staffs that have experienced between jobs have a greater belief in infrastructural barriers affecting e-banking development and respondents with different educational levels and positions hold a similar view. Second hypothesis: Knowledge barriers are one of the challenges for implementation and development of e- banking in India. Table 2 indicates that there is no correlation between knowledge barriers and e-banking development. Therefore, knowledge barriers are not a challenge for development of e-banking in India now. Table 4 Impact of knowledge barriers on e-banking according to variables Table 4 shows that there is no statistically significant difference at the p<0.05 level for the three groups on the basis of education therefore; respondents with different education levels have similar views regarding knowledge barriers. The Table also highlights that respondents with different job experiences and positions believe knowledge barriers have an identical impact on e-banking development. Third hypothesis: Legal and security barriers are one of the challenges for implementation and development of e-banking in India. Table 2 indicates there is a negative correlation between legal and security barriers and e-banking development. It means a null hypothesis is not accepted and legal and security barriers are a challenge for implementation and development of e-banking in India. Table 5 Impact of Legal and Security barriers on e-banking according to variables Table 5 reveals that according to the F-value and significance level (3.030, 0.041) there is a statistically significant difference at the p<0.05 level for the three groups of job experience, therefore the Post-hoc test shows staff with less than 10 years experience, more than others believe that legal and regulation issues have a greater impact on the development of e-banking. In addition the t-value obtained together with the level of significance (0.034) indicates that the mean difference between the two groups is significant. Therefore, there is a meaningful significant difference between respondent s opinions with regards to legal and security barriers and customers believe legal and security issues have more impact on e-banking development. COPY RIGHT 2012 Institute of Interdisciplinary Business Research 34

5 Fourth hypothesis: Socio-cultural barriers are one of the challenges for implementation and development of e- banking in India. Table 2 indicates there is negative correlation between socio-cultural barriers and e-banking development in India. It means socio-cultural barriers are a challenge for the implementation and development of e-banking in India. Table 6 Impact of socio-cultural barriers on e-banking according to variables From Table 6 it is clear people with different educational levels have similar views regarding socio-cultural barriers but the F-Value and significance level (2.894, 0.050) show that respondents with different experiences have differing views regarding socio-cultural barriers. The Post-hoc test shows staffs with less than 10 years experience believe socio-cultural barriers have a greater impact on e-banking development in India and also from the table it is clear that bank staff believe socio-cultural barriers have more impact on either e-banking development or under development. Fifth hypothesis: Economic barriers are one of the challenges for implementation and development of e-banking in India. As can be seen from table 2, there is no correlation between economic barriers and e-banking development. Therefore, economic factors are not a challenge for the implementation and development of e-banking in India. Table 7 Impact of Economic barriers on the development of e-banking according to variables Table 7 reveals that there is no significant difference between opinions of respondents regarding the effects of economic barriers on e-banking development. Sixth hypothesis: Management and banking issues are one of the challenges for implementation and development of e-banking in India. Table 2 indicates there is negative correlation between management-banking issues and e-banking development and therefore management-banking is a challenge for the development of e-banking. Table 8 Impact of management-banking barriers on the development of e-banking according to variables Table 8 indicates that the obtained value of t and level of significance (-2.215, 0.028) show that the mean difference between the two groups is significant. Therefore, there is an important difference between respondent s opinions regarding management and banking barriers. Customers believe this obstacle has more impact on e-banking than staff and also the result showed respondents with different education levels and job experience hold similar views. Table 9 Ranking of e-banking barriers Successful growth and development of e-banking depends on identification of challenges and obstacles. Table 9 summarizes the ranking of e-banking challenges. Less awareness regarding new technologies and their benefits, illiteracy & computer illiteracy, and people wanting to have bank receipts are top challenges according to banks employees. Unlike bank staff, customers view less awareness, limited trained human resources, and low levels of income as important challenges for the development of e-banking. Managers and bank clerks are usually more aware of outsourcing costs as one of the challenges. This interpretation is consistent with banks employees rating of outsourcing as ranking fifth in importance. In addition, unlike banks managers and clerks, customers view the cost of maintenance and upgrading of web and networks as a less important challenge as this was ranked as twenty third in challenges with a mean of and respectively. Banks employees and customers perceive a low level of income per person and the need for heavy investment regarding technologies as a very important challenge. The economic circumstances of people and banks are of crucial importance for the use and implementation of new technologies. COPY RIGHT 2012 Institute of Interdisciplinary Business Research 35

6 From the above table it also becomes clear that law and regulation issues are still important for the better operation of e-banking according to both staff and bank customers. The resistance of employees and managers to new technologies is ranked lowest by staff and software is not perceived as a suitable indicator for customers (10.81 and 9.91). The above table also reveals the overall ranking of staff and customers. Bank staff and customers in the study believed that less awareness and familiarity regarding new technologies and their benefits, illiteracy, and low levels of computer literacy and limited trained human resources are particularly important challenges for the development of e-banking in India. These findings are somewhat expected. Social and cultural barriers in some countries may exist to deter the acceptance and operation of e-commerce and e-banking as a way of doing business. In countries like India, shopping and bank visits are a social activity and personal face-to-face contact with sellers and bankers is an important part of the shopping and business experience. Distrust of what businesses do with personal and credit card information is an ecommerce issue in any country, especially in countries where there may be good justification for such distrust, it could therefore become a serious obstacle to e-banking growth in India. Also the acute shortage of practical information about advantages of e-banking services and e-banking specialists in developing countries makes this as a major development challenge for e- banking. From the table it is clear that legal and security issues, lack and limitation of regulation and law, increased potential for fraud, denial of e-documents in courts, and the lack of a strong trust environment are very important. Lack of security and distrust of customers are very destructive for e-banking development and security concerns is probably one of the most challenging topics facing organizations interested in doing business over the Internet. This result is consistent with the findings reported earlier by other scholars in India (Dixit and Datt, [8]; khan et al, [11]; Sandeep. S [20]; Gupta [9]; Srivastava, [19]). Trust is a catalyst for human cooperation. It allows people to interact spontaneously and helps the economy to operate smoothly. Lack of trust on the other hand is like sand in the social machinery. It makes us waste time and resources on protecting ourselves against possible harm and thereby clogs up the economy [3]. Management failure to employ the latest security features will lead to customer distrust and damage of the banks reputation. Change and the shift of managers and decision makers, fee charges and unsuitable software are considered as the least important obstacles in India. Results of this study are not in agreement with the result of Amadeh and Jafarpor [4] whom argued that change and shift of managers and decision makers is one of the main obstacles for development of e-banking in Iran and limited expertise, human resources, and outsourcing are the least important obstacles.an interpretation of these results can be that the change and shift of decision makers is not common in India and the Reserve Bank of India is directing the banking system with new and upgraded guidelines and rules. In addition e-banking fees are quite low in India therefore cannot be an important obstacle. The Software Packages for Banking Applications in India had their beginnings in the middle of the 1980s, when the Banks spurred on by RBI and the Rangarajan Committee Report, started computerizing branches in a limited manner. Nowadays made-in-india financial software solutions are making waves across the globe and this result was expected. 6. Conclusion and Recommendations The objective of this study was to identify the challenges of e-banking from the perspective of employees and bank customers. The present investigation has shown that legal and security issues, socio-cultural barriers, and management-banking issues are accepted as challenges for e-banking development in India. Socio-cultural barriers rated as the most important challenge followed by legal, security issues and Management-banking. Knowledge, economic and infrastructural barriers are the least important according to both staff and customers. Ranking of indicators in table 8 highlights that less awareness regarding new technologies ranked as the most important and unsuitable software rated as the least important barrier among indicators. According to the study staff with years experience, more than others believed infrastructural barriers have a negative impact on e-banking development and staff with less than 10 years experience, more than others believed that legal and regulation issues and socio-cultural issues have an inappropriate impact on e- banking development. In addition staff believed caring about socio-cultural issues has a more effective impact on e-banking development. Customers more than staff believed that legal and security barriers and management and banking issues have more effect on e-banking development. Therefore, we can highlight for customers COPY RIGHT 2012 Institute of Interdisciplinary Business Research 36

7 security is still a big concern for usage of e-banking services and the view of young and educated staff regarding e-banking is more supportive in India. The results of the study shed light on some important issues related to specification of challenges for development of e-banking that have not been addressed by previous studies. First, in terms of theory and literature this study attempts to provide a model with six factors which almost includes all obstacles and challenges and can be useful for further researches. Secondly although previous studies focused on factors influencing adoption of e-banking (online-banking) the present study investigated the status of e-banking after adoption of e-banking by almost all India s banks. This study finds out that still after more than one decade of different kinds of e-services being adopted by banks in India, some aspects of socio-cultural issues do not support e-banking and it is because of a lack of confidence in technology and an online culture. Since the foundation of e-banking is based on such premises, some of these local socio-cultural aspects do pose significant challenges for e-banking development. This study suggests that decision makers should consider focusing on the trust, awareness, and confidence of users by enhancing security features, utilizing proper e-legislation, and the provision of digital receipts or a guarantee for every transaction in order to inspire greater confidence in users of such services and promote a culture of e-banking usage across India. COPY RIGHT 2012 Institute of Interdisciplinary Business Research 37

8 References 1. Angelakopoulos, G and Mihiotis, A. (2011). E-banking challenges and opportunities in Greek banking sector. Electronic Commerce Research Journal, 11(3): Aladwani, A, M. (2001), online banking: a field study of drivers, development challenges, and expectations. International Journal of Information Management, 21 (2001): Anne Patton, M and Jonsan A. (2004). Technology for trust in electronic commerce. Electronic Commerce Research Journal. 4(1-2): Amadeh, H and Jafarpour, M. (2009), Specification of Obstacles and Solutions of Electronic Banking Development within the Framework of Iran at 1404 Prospective. Danesh va Tose Journal, 26(2): Basel Committee Report on Banking Supervision. (1998). Risk Management for Banking and electronic money activities. Available From: 6. Byers, R.E. and Lederer, P.L. (2001) Retail banking service strategy: a model of traditional, electronic, and mixed distribution choices, Journal of Management Information Systems, 18(2): Daniel, E. (1999), Provision of Electronic Banking in the UK and the Republic of Ireland. International Journal of Bank Marketing, 17(2): Dixit and Datt (2010), Acceptance of e-banking among adult customers: An Empirical Investigation in India.15(2) available from: 9. Gupta.P.K (2008), Internet Banking In India Consumer Concerns and Bank Strategies. Global Journal of Business Research, 2(1): Khorshid, S. and Ghane, H. (2009), Ranking the challenges of e-banking with the help of AHP model. Journal of Modiriyate Sanati azad University of Sanandaj. 4(9): Khan, M.S., Mahapatra, S.S. and Sreekumar (2009), Service Quality Evaluation In Internet Banking: An Empirical Study In India, Int. J. Indian Culture And Business Management, 2(1): Nisture.R.R. (2003). E-banking challenges and opportunities. Economic and Political Weekly, 38: (51/52). Samenksha Trust Publication, Mumbai. 13. Rogers, E.M., (1995). Diffusion of innovations (4th Ed.). New York: Free Press.pp Rasoulian. M and Safari. M. (2011). The Reasons to Lack of Electronic Banking Achievement in Iran. International Journal of Managing Information Technology (IJMIT). 3(3), August Shah.M and Clarke.S. (2009). E-banking management. Issues, Solution, and Strategies. Information Science Reference Publication. New York. pp Shanmugan.B and Guru.B.K. (2003). E-banking in Malaysia. Published by Institute bank-bank Malaysia. pp Sathye, M. (1999), Adoption of internet banking by Australian consumers: an empirical investigation, International Journal of Bank Marketing, 17(7): Srivastava, R, K. (2007), Customer s Perception on Usage of Internet Banking. Journal of Innovative Marketing, 3(4): Sundeep. S. (2008), Internet banking and consumer acceptance: The India scenario. From: dyuthi.cusat.ac.in/xmlui/bitstream/handle/purl/.../dyuthi-t0419.pdf. 20. Vaithianathan, S. (2010). A review of e-commerce literature on India and research agenda for future. Electronic Commerce Research Journal, 10(1): Zheng, Qin; Han, Yi; Li, Shundong; Dong, Jinchun; Yan, Lixiang; and Qin, Jun. (2009). Introduction to E-commerce. Part5.Availablefrom: content/qx1v072w k/resource-secured/?target=fulltext.pdf&sid=iibpalqrlteepyrsxijmzwjo&sh = COPY RIGHT 2012 Institute of Interdisciplinary Business Research 38

9 Annexure Table 1 Challenges and indicators of e-banking Challenge Indicator Weak Telecommunications (fiber optic, satellite networks, and communication bandwidth) Infrastructural Software available in the country is not suitable Hardware available is not sufficient in the country (PC, ATM, POS, etc.) Limited trained Human Resources Improper use of Technology Knowledge Lack of Technological knowledge (managers, employees, clients) Flaws in design, implementation and monitoring of Bank s information system Lack and limitation of regulation and law Increased potential of fraud Legal and security Denial of e-documents in courts Lacking or weak security measures Lack of strong trust environment Negative perception of e-banking services Less awareness and familiarity regarding new technologies and their benefits Illiteracy Charging fees is a reason for the loss of customers Socio-cultural Worry and perception of e-banking as a threat to the bank s employees Some clients tend to go to a bank in order to communicate with bank s clerk Tendency of people to hold cash component in India People want to have a bank receipt English Language barrier COPY RIGHT 2012 Institute of Interdisciplinary Business Research 39

10 Need for heavy investment regarding new infrastructures Economic Low level of Internet penetration due to high costs Low level of average income per person and therefore, low ability to achieve communication equipment in India Outsourcing E-banking poses a number of managerial risks for Bank management Resistance of employees and managers regarding new technologies Management and Banking Lack of adequate coordination, interaction and cooperation between banks and other decision making centers Lack of long term strategic management Change and shift of managers and decision makers is an important obstacle Table 2 Correlation analysis of challenges and e-banking development Challenge r sig Significant level Infrastructural 0.05 Knowledge 0.05 Legal-Security 0.05 Socio-Cultural 0.05 Economic 0.05 Management Banking COPY RIGHT 2012 Institute of Interdisciplinary Business Research 40

11 Table 3 Impact of infrastructural barriers on e-banking according to variables Variables Frequency Mean SD Test Sig Diploma 2% Education Graduation 52.5% F= level Post- 45.5% graduation Job Less than10 25% experience % F= * More than % Position Staff T= Customer *p<0.05 Table 4 Impact of knowledge barriers on e-banking according to variables Variables Frequency Mean SD Test Sig Diploma 2% Educational Graduation 52.5% F= level Post- 45.5% graduation Job Less than 10 25% experience % F= More than % Position Staff T= Customer p<0.05 COPY RIGHT 2012 Institute of Interdisciplinary Business Research 41

12 Table 5 Impact of Legal and Security barriers on e-banking according to variables Variables Frequency Mean SD Test Sig Diploma 2% Education Graduation 52.5% F= level Post- 45.5% graduation Job Less than 10 25% experience % F= * More than % Position Staff T= * Customer *p<0.05 Table 6 Impact of socio-cultural barriers on e-banking according to variables variables Frequency Mean SD Test Sig Diploma 2% Education Graduation 52% F= level Post- 45% graduation Job Less than 10 25% experience % F= * More than % Position Staff T= * Customer *p<0.05 COPY RIGHT 2012 Institute of Interdisciplinary Business Research 42

13 Table 7 Impact of Economic barriers on the development of e-banking according to variables Variable Frequency Mean S.D Test Sig Diploma 2% Education Graduation 52.5% F= level Post- 45.5% graduation Job Less than 10 25% experience % F= More than % Position Staff T= Customer p<0.05 Table 8 Impact of management-banking barriers on the development of e-banking according to variables Variables Frequency Mean S.D Test Sig Diploma 2% Education Graduation 52.5% F= level Post- 45.5% graduation Job Less than 10 25% experience % F= More than % Position Staff T= * Customer *p<0.05 COPY RIGHT 2012 Institute of Interdisciplinary Business Research 43

14 Table 9 Ranking of e-banking barriers Indicator Challenge Mean Staff Mean Customer Mean Overall rank Less Awareness Socio-cultural Illiteracy and Computer Socio-cultural illiteracy Limited trained Human Knowledge Resources Banking Receipt Socio-cultural Average Income Economical Heavy Investment Economical Tendency to Hold cash Socio-cultural Lack of Technological Knowledge knowledge Contact with Bankers Social-cultural Negative Perception Social-cultural Weak Telecommunications Infrastructural Internet Penetration Economical Outsourcing Economical Lack and Limited Legal-security regulation Increased potential for Legal- security fraud e-banking poses risks Management-bank Lack of strong trust Legal-security environment Denial of e-documents by Legal-security courts Improper use of technology Knowledge Hardware are not Infrastructural sufficient Management Lack of adequate banking coordination, interaction COPY RIGHT 2012 Institute of Interdisciplinary Business Research 44

15 between decision makers Social-cultural Language barriers Knowledge Flaws in design, and monitoring banks information system Legal-security Weak security measures Management Resistance of employees of banking banks regarding new technologies Social-cultural Perception of e-banking as a threat for banks employees Management Lack of long term strategic banking management Management Change and shift of banking managers and decision makers Social-cultural Charging fees Infrastructural Software not suitable COPY RIGHT 2012 Institute of Interdisciplinary Business Research 45