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We understand your world

MM University, Mullana
In partial fulfillment of the degree of Master of Business

(Session: 2008-2010)


Mr. Varun Bali SHIVANI
(Deputy Manager) Roll No. 1208729
MBA-3rd Sem.(A)
Session: 2008-10


Affiliated to Maharishi Markandeshwar University
Mullana –Ambala(Haryana)

I SHIVANI hereby declare that the dissertation report entitled “E-Banking

preferences among people in Yamuna Nagar” submitted for the partial fulfillment
of the degree of Masters in Business Administration from Maharishi Markandeshwer
University, Mullana is original document of mine and data provided is authentic and
to the best of way of my knowledge.


“Gratitude is not a thing of expression, it is more a matter of feeling”.

There is always a sense of gratitude which one express for others for
their help and supervision in achieving the goals. I too express my deep gratitude to
each and every one who has been helpful to me in completing the project report

First, of all, I am highly thankful to Dr. Sanjiv Marvah, ( Director, MMIM) for allowing
me to persue my Summer Training Report on “Analysis of Various Schemes
Provided by HDFC Bank.”

My special thanks to Mr. Lokesh Dutt (Branch Manager) who encouraged me,
properly guided me in each and every possible way through out my Training Report.

I give my regards and sincere thanks to Mr. Varun Bali (Deputy Manager) who
has devoted his precious time in guiding me and helping me it with in time.

I am indebted to the Bank employees who supported me in handling my

queries. I feel self-short of words to thanks my parents and friends who had directly
or indirectly instrumental in the completion of the project.


With the rapid globalization of the Indian economy, enterprises are facing with ever
changing competitive environment. Enterprises are adopting strategies aimed at
developing competitive advantage based on enhanced customer value in terms of
product differentiation, quality, speed, service and costs. In the post liberalization era,
with the deregulation of Indian economy, the financial service sector witnessing a
complete metamorphosis and technology is playing a very significant role in this
record. Over the last decade India has been one of the fastest adopters of
information technology, particularly because of its capability to provide software
solution to organizations around the world. This capability has provided a
tremendous impetuous to the domestic banking industry in India to deploy the latest
in technology, particularly in the Internet banking and e-commerce arenas. Banks are
growing in size by mergers and acquisitions, which have been driven by
communication and technology. Technology is playing a major role in increasing the
efficiency, courtesy and speed of customer service. It is said to be the age of E-
banking. An Online Banking user is expected to perform at least one of the following
transactions online:
1. Checking account balance and transaction history

2. Paying bills

3. Transferring funds between accounts

4. Requesting credit card advances

5. Ordering checks

6. Managing investments and stocks trading

From a bank’s perspective, using the Internet is more efficient than using other
distribution mediums because banks are looking for an increased customer base.
Using multiple distribution channels increases effective market coverage by enabling
different products to be targeted at different demographic segments. Also Banks
cannot risk loosing customers to competitors within the aggressive competition in the
banking industry around the world. Moreover Internet delivery offers customized
service to suit the needs and the likes of each user. Mass customization happens
effectively through Online Banking. It reduces cost and replaces time spent on
routine errands with spending time on business errands. Online Banking means less
staff members, smaller infrastructure demands, compared with other banking
channels. From the customers’ perspective, Online Banking provides a convenient
and effective way to manage finances that is easily accessible 24 hours a day, seven
days a week. In addition information is up to date. Nevertheless Online Banking has
disadvantages for banks like how to work the technology, set-up cost, legal issues,
and lack of personal contact with customers. And for customers there are security
and privacy issues.

Introduction :
• To banking
• To HDFC Bank


Literature Review

Research Methodology

Data Analysis And Interpretation


SWOT Analysis






A feature of the banking industry across the globe has been that it is increasingly
becoming turbulent and competitive, characterized by an increasing trend towards
internationalization, mergers, takeovers and consolidation of the banking industry.
Moreover a number of non-banking companies are entering the banking industry by
offering financial products and services (e.g., Toyota’s credit card, GM’s auto
financing, etc). This has given innumerable options to customers in choosing
banking services. As a response and aided by technological developments, banks
have attempted to build customer satisfaction through providing better products and
services and at the same time to reduce operating costs. Thus the banking industry
has been constantly innovating and with the advent of technological developments,
particularly in the area of telecommunications and information technology, one of the
latest innovation that took birth, and quite inevitably, has been the internet

With cyber cafés and kiosks springing up in different cities access to the Net is going
to be easy. Internet banking (also referred as e banking) is the latest in this series of
technological wonders in the recent past involving use of Internet for delivery of
banking products & services. Even the Morgan Stanley Dean Witter Internet
research emphasized that Web is more important for retail financial services than for
many other industries.

Internet banking is changing the banking industry and is having the major effects on
banking relationships. Banking is now no longer confined to the branches were one
has to approach the branch in person, to withdraw cash or deposit a cheque or
request a statement of accounts. In true Internet banking, any inquiry or transaction
is processed online without any reference to the branch (anywhere banking) at any
time. Providing Internet banking is increasingly becoming a "need to have" than a
"nice to have" service. The net banking, thus, now is more of a norm rather than an
exception in many developed countries due to the fact that it is the cheapest way of
providing banking services.

The word "BANK" is derived from the 'Bancus' or 'Banque', which means a bench. In
the early days the European moneylenders and moneychangers used to sit on the
benches and exhibit coins of different countries in big heaps for the purpose of
changing and lending money,

A Banking company is defined as a company, which transacts the business of
banking in India.

As per Banking Regulation Act 1949 Section 5(b)

"Banking means, accepting for the purpose of lending or investment, of deposits of
money from the public, repayable on demand or otherwise, and withdrawal by
cheque, draft, or otherwise."

According to Sir John Paget

"No person or body, corporate or otherwise can be a banker who does not, (a) take
deposits accounts, (b) take current accounts, (c) issue and pay cheques, (d) collect
cheques, crossed and uncrossed, for his customers."
In simple words we can say that bank is a financial institution which deals in
money and credit by obtaining deposits from public and giving loans and credit to
trade and industrial respectively. "

1. Primary Functions
(a) Acceptance of deposits
(b) Making Loans and Advances
 Loans
 Overdrafts
 Cash Credit
 Discounting of Bills of Exchange

2. Secondary Functions
(a) Agency Functions
 Collection of cheques and bills etc
 Collection of interest and dividend
 Making payment on behalf of customers .Purchase and sale of
 Facility of transfer of funds
 To act as trustee and executor

(b) Utility Functions

 Safe custody of customers valuable articles and securities.
 Underwriting facility
 Issuing of Traveller's cheque and letter of credit
 Facility of foreign exchange
 Providing trade information
 Providing information regarding credit worthiness of their

On the basis of ownership banks are of the following types:


Public sector banks are those banks that are owned by the Government. The
Govt. runs these Banks. In India 14 banks were nationalized in 1969 & in 1980
another 6 banks were also nationalized. Therefore in 1980 the number of
nationalized bank 20. But at present there are 9 banks are nationalized. All these
banks are belonging to public sector category. Welfare is their principle objective.


These banks are owned and run by the private sector. Various banks in the
country such as ICICI Bank, HDFC Bank etc. An individual has control over there
banks in preparation to the share of the banks held by him.

Co-operative banks are those financial institutions. They provide short term &
medium term' loans to there members. Co-operative banks are in every state in
India -Its branches at district level are known as the central co-operative bank.
The central co-operative bank in turn has its branches both in the urban & rural
areas. .Every state cooperative bank is an apex bank, which provides credit
facilities to the central co-operative bank. It mobilized financial resources from
richer section of urb3n population by accepting deposit and creating the credit
like commercial bank and borrowing from the money mkt. It also gets funds from




Type Private
Founded 1994
HDFC Bank Ltd.,
Mumbai, India
Industry Insurance
Capital Markets and allied industries

Loans, Credit Cards, Savings,

Investment vehicles, Insurance etc.

HDFC Bank (NYSE: HDB), one amongst the firsts of the new generation, tech-savvy
commercial banks of India, was incorporated in August 1994, after the Reserve Bank of
India allowed setting up of Banks in the private sector. The Bank was promoted by the
Housing Development Finance Corporation Limited, a premier housing finance
company (set up in 1977) of India..


The Housing Development Finance Corporation Limited (HDFC) was amongst the first
to receive an 'in principle' approval from the Reserve Bank of India (RBI) to set up a
bank in the private sector, as part of the RBI's liberalisation of the Indian Banking
Industry in 1994. The bank was incorporated in August 1994 in the name of 'HDFC
Bank Limited', with its registered office in Mumbai, India. HDFC Bank commenced
operations as a Scheduled Commercial Bank in January 1995.

Branch network

Currently HDFC Bank has 1416 branches, 3382 ATMs, in 550 cities in India, and all
branches of the bank are linked on an online real-time basis. The bank offers many
innovative products & services to individuals, corporates, trusts, governments,
partnerships, financial institutions, mutual funds, insurance companies.

It is a path breaker in the Indian banking sector. In 2007 HDFC Bank acquired
Centurion Bank of Punjab taking its total branches to more than 1,000. Though, the
official license was given to Centurion Bank of Punjab branches, to continue working as
HDFC Bank branches, on May 23, 2008.


Mr. Aditya Puri (Managing Director)

Mr. Keke Mistry
Dr. (Mrs.) Amla Samanta
Mr. Venkat Rao Gadwal
Mr. Anil Ahuja
Mr. Vineet Jain
Mr. Ranjan Kapoor
Mr. Bobby Parikh
Mrs. Renu Karnal

VICE President (Legal ) & Co. Secretary

Mr. Sanjay Dongre
P.C. Honsolia & Co. (Chartered Accountant)
Registered Office
HDFC Bank House
Senapati Bapat Marg
Loveer Parel Mumbai – 400013
Tel. No. 56521000
Fax No. 24960739

Web. Site –

HDFC Bank's mission is to be a World-Class Indian Bank. The Bank's aim is to
build sound customer franchises across distinct businesses so as to be the preferred
provider of banking services in the segments that the bank operates in and to achieve
healthy growth in profitability, consistent with the bank's risk appetite. The bank is
committed to maintain the highest level of ethical standards, professional integrity and
regulatory compliance. HDFC Bank's business philosophy is based on four core values:
Operational Excellence, Customer Focus, Product Leadership and People.

HDFC Bank caters to a wide range of banking services covering both commercial and
investment banking on the wholesale side and transactional/branch banking on the
retail side. The bank has three key business areas:
(a) Wholesale Banking Services
The Bank's target market is primarily large, blue chip manufacturing companies
in the Indian corporate sector and to a lesser extent, emerging midsized
corporates. For these corporate, the Bank provides a wide range of commercial
and transactional banking services, including working capital finance, trade
services, transactional services, cash management, etc. The bank is also a
leading provider of structured solutions that combine cash' management services
with vendor and distributor finance for facilitating superior supply chain
management for its corporate customers.
(b) Retail Banking Services
The objective of the Retail Bank is to provide its target market customers a full
range of financial products and banking services, giving the customer a one stop
window for all his/her banking requirements. The products are backed by world-
class service and delivered to the customers through the growing branch
network, as well as through alternative delivery channels like ATMs, Phone
Banking, Net Banking and Mobile Banking.
The HDFC Bank Preferred program for high net worth individuals, the
HDFC Bank Plus and the Investment Advisory Services programs have been

designed keeping in mind needs of customers who seek distinct financial
solutions, information and advice on various investment avenues. The Bank also
has a wide array of retail loan products including Auto Loans, Loans against
marketable securities, Personal Loans and Loans for Two-wheelers. Its also a
leading provider of Depository Services to retail customers, offering customers
the facility to hold their investments in electronic form.
HDFC Bank was the first bank in India to launch an International
Debit Card in association with VISA (VISA Electron) and issues the MasterCard
Maestro debit card as well. The debit card allows the user to directly debit his
account at the point of purchase at a merchant establishment, in India and
overseas. The Bank launched its credit card in association with VISA in
November 2001. The Bank is also one of the leading players in the "merchant
acquiring" business with over 25,000 Point-of-sale (POS) terminals for debit /
credit cards acceptance at merchant establishments. The Bank is well positioned
as a leader in various net-based B2C opportunities including a wide range of
Internet banking services for Fixed Deposits, Loans, Bill Payments., etc.
(c) Treasury Operations
Within this business, the bank has three main product areas-Foreign Exchange
and Derivatives, Local Currency Money Market & Debt Securities, and Equities
With the liberalization of the financial markets in India, corporate need more
sophisticated risk management information, advice and product structures,
These and fine pricing on various treasury products are provided through the
bank's Treasury team. To comply with statutory reserve requirements, the bank is
required to hold 25% of its deposits in government securities. The Treasury
business is responsible for managing the returns and market risk on this
investment portfolio.

Product Range

Range of

Accounts Access
nts & Forex
& Loans Cards your
Insuranc Services
Deposits Bank

-nts &

Saving Salary Curren Fixed Demat Safe

Accou Accou t Deposi Accou Deposi
nt nt Accou ts nt ts
nt Locker


Two Loan
Perso Educa Agains Tract Gold
Home Wheel
nal tion t or Loan
Loan er Proper
Loan Loan Loan
Loan ty


Debit cards Credit Cards Prepaid Card

ent &

Mutual & Knowled Mudra
Insuranc &
Fund Health Bonds ge Gold
e Derivati
Insuranc Center Bar


Product RBI
Trade Forex services
& Guidelin
Services Limited Branch
Services e


Mobile Phone Net Branch
ATM Statemen
Banking Banking Banking Network



Electronic banking is one of the truly widespread avatars of E-commerce the world over.
Various authors define E-Banking differently but the most definition depicting the
meaning and features of E-Banking are as follows:

1. Banking is a combination of two, Electronic technology and Banking.

2. Electronic Banking is a process by which a customer performs banking

Transactions electronically without visiting a brick-and-mortar institutions.

3. E-Banking denotes the provision of banking and related service through

Extensive use of information technology without direct recourse to the bank by
the customer.




One has to approach the branch in person, to withdraw cash or deposit a cheque or
request a statement of accounts. In true Internet banking, any inquiry or transaction is
processed online without any reference to the branch (anywhere banking) at any time.
Providing Internet banking is increasingly becoming a "need to have" than a "nice to
have" service. The net banking, thus, now is more of a norm rather than an exception in
many developed countries due to the fact that it is the cheapest way of providing
banking services.

Banks have traditionally been in the forefront of harnessing technology to improve their
products, services and efficiency. They have, over a long time, been using electronic
and telecommunication networks for delivering a wide range of value added products
and services. The delivery channels include direct dial – up connections, private
networks, public networks etc and the devices include telephone, Personal Computers
including the Automated Teller Machines, etc. With the popularity of PCs, easy access
to Internet and World Wide Web (WWW), Internet is increasingly used by banks as a
channel for receiving instructions and delivering their products and services to their
customers. This form of banking is generally referred to as Internet Banking, although
the range of products and services offered by different banks vary widely both in their
content and sophistication.


The story of technology in banking started with the use of punched card machines like
Accounting Machines or Ledger Posting Machines. The use of technology, at that time,
was limited to keeping books of the bank. It further developed with the birth of online
real time system and vast improvement in telecommunications during late 1970’s and
1980’ resulted in a revolution in the field of banking with “convenience banking” as a
buzzword. Through Convenience banking, the bank is carried to the doorstep of the

The 1990’s saw the birth of distributed computing technologies and Relational Data
Base Management System. The banking industry was simply waiting for these
technologies. Now with distribution technologies, one could configure dedicated
machines called front-end machines for customer service and risk control while
communication in the batch mode without hampering the response time on the front-end

Virtual or E-banking
Traditional banking
Nuclear charged
Real time transactions,
Personalized services, time
integrated platform, all time
consuming, limited access

Intense competition has forced banks to rethink the way they operated their business.
They had to reinvent and improve their products and services to make them more
beneficial and cost effective. Technology in the form of E-banking has made it possible
to find alternate banking practices at lower costs.

More and more people are using electronic banking products and services because
large section of the banks future customer base will be made up of computer literate
customer, the banks must be able to offer these customer products and services that

allow them to do their banking by electronic means. If they fail to do this will, simply, not
survive. New products and services are emerging that are set to change the way we
look at money and the monetary system.



Automated Teller Machine (ATM)

These are cash dispensing machine, which are frequently seen at banks and other
locations such as shopping centers and building societies. Their main purpose is to
allow customer to draw cash at any time and to provide banking services where it would
not have been viable to open another branch e.g. on university campus.

An automated teller machine or automatic teller machine (ATM) is a computerized

telecommunications device that provides a financial institution's customers a method of
financial\ transactions in a public space without the need for a human clerk or bank
teller. On most modern ATMs, the customer identifies him or herself by inserting a
plastic ATM card with a magnetic stripe or a plastic smartcard with a chip that contains
his or her card number and some security information, such as an expiration date or
CVC (CVV). Security is provided by the customer entering a personal identification
number (PIN).

Using an ATM, customers can access their bank accounts in order to make cash
withdrawals (or credit card cash advances) and check their account balances. Many
ATMs also allow people to deposit cash or checks, transfer money between their bank
accounts, pay bills, or purchase goods and services.

ATMs are known by various casual terms including cash machine, hole-in-the-wall, cash
point or Bancomat (in Europe and Russia). The occasionally-used ATM Machine is an
example of RAS syndrome.

Some of the advantages of ATM to customers are:-

• Ability to draw cash after normal banking hours
• Quicker than normal cashier service
• Complete security as only the card holder knows the PIN
• Does not just operate as a medium of obtaining cash.

• Customer can sometimes use the services of other bank ATM’s.

Telebanking or Phone Banking

Telephone banking is relatively new Electronic Banking Product. However it is fastly
becoming one of the most popular products. Customer can perform a number of
transactions from the convenience of their own home or office; in fact from anywhere
they have access to phone. Customers can do following:-
• Check balances and statement information
• Transfer funds from one account to another
• Pay certain bills
• Order statements or cheque books
• Demand draft request
This facility is available with the help of Voice Response System
(VRS). This system basically, accepts only TONE dialed input. Like the ATM customer
has to follow particular process, initially account number and telephone PIN are fed for
the process to start. Also the VRS system provides the users within additional facilities
such as changing existing password with the new desired, information about new
products, current interest rates etc.

Mobile Banking
Mobile banking comes in as a part of the banks initiative to offer multiple channel
banking providing convenience for its customer. A versatile multifunctional, free service
that is accessible and viewable on the monitor of mobile phone. Mobile phones are
playing great role in Indian banking- both directly and indirectly. They are being used
both as banking and other channels.

Internet Banking
The advent of the Internet and the popularity of personal computers presented both an
opportunity and a challenge for the banking industry. For years, financial institutions
have used powerful computer networks to automate million of daily transactions; today,

often the only paper record is the customer’s receipt at the point of sale. Now that their
customers are connected to the Internet via personal computers, banks envision similar
advantages by adopting those same internal electronic processes to home use.

Banks view online banking as a powerful “value added” tool to attract and retain new
customers while helping to eliminate costly paper handling and teller interactions in an
increasingly competitive banking environment. In India first one to move into this area
was ICICI Bank. They started web based banking as early as august 1997.

Understanding the various types of Internet banking will help examiners assess the
risks involved. Currently, the following three basic kinds of Internet banking are being
employed in the marketplace.
• Informational- this is the basic level of Internet banking. Typically, the bank has
marketing information about the bank’s products and services on a stand-alone
server. The risk is relatively low, as informational systems typically have no path
between the server and the bank’s internal network. This level of Internet banking
can be provided by the banks or outsourced. While the risk to a bank is relatively
low, the server or web site may be vulnerable to alteration. Appropriate controls
therefore must be in place to prevent unauthorized alterations to the bank’s
server or web site.

• Communicative- this type of Internet banking systems and the customer. The
interaction between the bank’s system and the customer. The interaction may be
limited to electronic mail, account enquiry, loan applications, or static file updates
(name and address change). Because these servers may have a path to the
bank’s internal networks, the risk is higher with this configuration than with
informational systems. Appropriate controls need to be in the place to prevent,
monitor, and alert management of any unauthorized attempt to access the bank’s
internal networks and computer systems. Virus controls also become much more
critical in this environment.

• Transactional- this level of Internet banking allows customers to execute

transactions. Since a path typically exists between the server and the bank or
outsourcer’s internal network, this is the highest risk architecture and must have
the strongest controls. Customer transactions can include accessing accounts,
paying bills, transferring funds etc.


• Convenience- Unlike your corner bank, online banking sites never close;
they’re available 24 hours a day, seven days a week, and they’re only a mouse
click away.

• Ubiquity- If you’re out of state or even out of the country when a money
problem arises, you can log on instantly to your online bank and take care of
business, 24\7.

• Transaction speed- Online bank sites generally execute and confirm

transactions at or quicker than ATM processing speeds.

• Efficiency-You can access and manage all of your bank accounts, including
IRA’s, CDs, even securities, from one secure site.

• Effectiveness- Many online banking sites now offer sophisticated tools,

including account aggregation, stock quotes, rate alert and portfolio managing
program to help you manage all of your assets more effectively. Most are also
compatible with money managing programs such as quicken and Microsoft


• Start-up may take time-In order to register for your bank’s online program, you
will probably have to provide ID and sign a form at a bank branch. If you and
your spouse wish to view and manage their assets together online, one of you
may have to sign a durable power of attorney before the bank will display all of
your holdings together.

• Learning curves- Banking sites can be difficult to navigate at first. Plan to invest
some time and\or read the tutorials in order to become comfortable in your virtual

• Bank site changes- Even the largest banks periodically upgrade their online
programs, adding new features in unfamiliar places. In some cases, you may
have to re-enter account information.


1. Bill payment service

Each bank has tie-ups with various utility companies, service providers and insurance
companies, across the country. It facilitates the payment of electricity and telephone
bills, mobile phone, credit card and insurance premium bills.

To pay bills, a simple one-time registration for each biller is to be completed. Standing
instructions can be set, online to pay recurring bills, automatically. One-time standing
instruction will ensure that bill payments do not get delayed due to lack of time. Most
interestingly, the bank does not charge customers for online bill payment.

2. Fund transfer

Any amount can be transferred from one account to another of the same or any another
bank. Customers can send money anywhere in India. Payee’s account number, his
bank and the branch is needed to be mentioned after logging in the account. The
transfer will take place in a day or so, whereas in a traditional method, it takes about
three working days. ICICI Bank says that online bill payment service and fund transfer
facility have been their most popular online services.

3. Credit card customers

Credit card users have a lot in store. With Internet banking, customers can not only pay
their credit card bills online but also get a loan on their cards. Not just this, they can also
apply for an additional card, request a credit line increase and God forbid if you lose
your credit card, you can report lost card online.

4. Railway pass

This is something that would interest all the aam janta. Indian Railways has tied up with
ICICI bank and you can now make your railway pass for local trains online. The pass
will be delivered to you at your doorstep. But the facility is limited to Mumbai, Thane,

Nasik, Surat and Pune. The bank would just charge Rs 10 + 12.24 percent of service

5. Investing through Internet banking

Opening a fixed deposit account cannot get easier than this. An FD can be opened
online through funds transfer. Online banking can also be a great friend for lazy

Now investors with interlinked demat account and bank account can easily trade in the
stock market and the amount will be automatically debited from their respective bank
accounts and the shares will be credited in their demat account.

Moreover, some banks even give the facility to purchase mutual funds directly from the
online banking system.

So it removes the worry about filling those big forms for mutual funds, they will now be
just a few clicks away. Nowadays, most leading banks offer both online banking and
demat account. However if the customer have there demat account with independent
share brokers, then need to sign a special form, which will link your two accounts.

6. Recharging your prepaid phone

Now there is no need to rush to the vendor to recharge the prepaid phone, every time
the talk time runs out. Just top-up the prepaid mobile cards by logging in to Internet
banking. By just selecting the operator's name, entering the mobile number and the
amount for recharge, the phone is again back in action within few minutes.

7. Shopping at your fingertips

Leading banks have tie ups with various shopping websites. With a range of all kind of
products, one can shop online and the payment is also made conveniently through the
account. One can also buy railway and air tickets through Internet banking.

List of some banks operating E-Banking in India

Bank Name Technology Vendor Service offering

ABN AMRO Bank Infosys (Bank Away) NetBanking
Abu Dhabi Commercial Bank Infosys (Bank Away) ADCB NetLink
Bank of India I-flex BOIonline
Citibank Orbitech (now Polaris) Citibank Online
Corporation Bank I-flex CorpNet
Deutsche Bank db direct
Federal Bank Sanchez FedNet
Global Trust Bank Infosys (BankAway) ibank@gtb
HDFC Bank i-flex/ Satyam NetBanking
HSBC Online@hsbc
ICICI Bank Infosys, ICICI Infotech Infinity
IDBI Bank Infosys (Bank Away) i-net banking
IndusInd Bank CR2 IndusNet
Punjab National Bank Infosys (Bank Away) Internet Banking
Standard Chartered Bank In-House Me Standard Chartered Online
State Bank of India Satyam/Broadvision
UTI Bank Infosys (Bank Away) I connect


In spite of so many facilities that Internet banking offers us, we still seem to trust our
traditional method of banking and is reluctant to use online banking. But here are few
cases where Internet banking will turn out to be a better option in terms of saving your

'Stop payment' done through Internet banking will not cost any extra fees but when
done through the branch, the bank may charge you Rs 50 per cheque plus the service

Through Internet banking, you can check your transactions at any time of the day, and
as many times as you want to.

On the other hand, in a traditional method, you get quarterly statements from the bank
and if you request for a statement at your required time, it may turn out to be an
expensive affair. The branch may charge you Rs 25 per page, which includes only 30
transactions. Moreover, the bank branch would take eight days to deliver it at your

If the fund transfer has to be made outstation, where the bank does not have a branch,
the bank would demand outstation charges. Whereas with the help of online banking, it
will be absolutely free for you.

As per the Internet and Mobile Association of India's report on online banking 2006,
"There are many advantages of online banking. It is convenient, it isn't bound by
operational timings, there are no geographical barriers and the services can be offered
at a miniscule cost."


One of the issues currently being addressed is the impact of e-banking on traditional
banking players. After all, if there are risks inherent in going into e-banking there are
other risks in not doing so. It is too early to have a firm view on this yet. Even to
practitioners the future of e-banking and its implications are unclear. It might be
convenient nevertheless to outline briefly two views that are prevalent in the market.The
view that the Internet is a revolution that will sweep away the old order holds much
sway. Arguments in favor are as follows:

E-banking transactions are much cheaper than branch or even phone transactions. This
could turn yesterday’s competitive advantage - a large branch network - into a
comparative disadvantage, allowing e-banks to undercut bricks-and-mortar banks. This
is commonly known as the "beached dinosaur" theory.

E-banks are easy to set up so lots of new entrants will arrive. ‘Old-world’ systems,
cultures and structures will not encumber these new entrants. Instead, they will be
adaptable and responsive. E-banking gives consumers much more choice. Consumers
will be less inclined to remain loyal.

E-banking will lead to an erosion of the ‘endowment effect’ currently enjoyed by the
major UK banks. Deposits will go elsewhere with the consequence that these banks will
have to fight to regain and retain their customer base. This will increase their cost of
funds, possibly making their business less viable. Lost revenue may even result in these
banks taking more risks to breach the gap.

Portal providers are likely to attract the most significant share of banking profits. Indeed
banks could become glorified marriage brokers. They would simply bring two parties
together – eg buyer and seller, payer and payee.

The products will be provided by monolines, experts in their field. Traditional banks may
simply be left with payment and settlement business – even this could be cast into

Traditional banks will find it difficult to evolve. Not only will they be unable to make
acquisitions for cash as opposed to being able to offer shares, they will be unable to
obtain additional capital from the stock market. This is in contrast to the situation for
Internet firms for whom it seems relatively easy to attract investment.
There is of course another view which sees e-banking more as an evolution than a
E-banking is just banking offered via a new delivery channel. It simply gives consumers
another service (just as ATMs did).
Like ATMs, e-banking will impact on the nature of branches but will not remove their
Experience in Scandinavia (arguably the most advanced e-banking area in the world)
appears to confirm that the future is ‘clicks and mortar’ banking. Customers want full
service banking via a number of delivery channels. The future is therefore ‘Martini
Banking’ (any time, any place, anywhere, anyhow).
Traditional banks are starting to fight back. The start-up costs of an e-bank are high.
Establishing a trusted brand is very costly as it requires significant advertising
expenditure in addition to the purchase of expensive technology (as security and
privacy are key to gaining customer approval).
E-banks have already found that retail banking only becomes profitable once a large
critical mass is achieved. Consequently many e-banks are limiting themselves to
providing a tailored service to the better off.
Nobody really knows which of these versions will triumph. This is something that the
market will determine. However, supervisors will need to pay close attention to the
impact of e-banks on the traditional banks, for example by surveillance of:
• strategy
• customer levels
• earnings and costs

• advertising spending
• margins
• funding costs
• Merger opportunities and threats, both in the UK and abroad.


Drivers of change

Advantages previously held by large financial institutions have shrunk considerably. The
Internet has leveled the playing field and afforded open access to customers in the
global marketplace. Internet banking is a cost-effective delivery channel for financial
institutions. Consumers are embracing the many benefits of Internet banking. Access to
one's accounts at anytime and from any location via the World Wide Web is a
convenience unknown a short time ago. Thus, a bank's Internet presence transforms
from 'brouchreware' status to 'Internet banking' status once the bank goes through a
technology integration effort to enable the customer to access information about his or
her specific account relationship. The six primary drivers of Internet banking includes, in
order of primacy are:

• Improve customer access

• Facilitate the offering of more services
• Increase customer loyalty
• Attract new customers
• Provide services offered by competitors
• Reduce customer attrition


The banking industry in India is facing unprecedented competition from non-traditional

banking institutions, which now offer banking and financial services over the Internet.
The deregulation of the banking industry coupled with the emergence of new
technologies, are enabling new competitors to enter the financial services market
quickly and efficiently.

Indian banks are going for the retail banking in a big way. However, much is still to be
achieved. This study that was conducted by students of IIML shows some interesting

• Throughout the country, the Internet Banking is in the nascent stage of

development (more than 50 banks are offering varied kind of Internet banking
• In general, these Internet sites offer only the most basic services. 55% are so
called 'entry level' sites, offering little more than company information and basic
marketing materials. Only 8% offer 'advanced transactions' such as online funds
transfer, transactions & cash management services.
• Foreign & Private banks are much advanced in terms of the number of sites &
their level of development.


Information technology analyst firm, the Meta Group, recently reported "financial
institutions who don't offer home banking by the year 2000 will become marginalized."
By the year of 2002, a large sophisticated and highly competitive Internet Banking
Market will develop which will be driven by

• Demand side pressure due to increasing access to low cost electronic services.
• Emergence of open standards for banking functionality.
• Growing customer awareness and need of transparency.
• Global players in the fray
• Close integration of bank services with web based E-commerce or even
disintermediation of services through direct electronic payments (E- Cash).
• More convenient international transactions due to the fact that the Internet along
with general deregulation trends eliminates geographic boundaries.
• Move from one stop shopping to 'Banking Portfolio' i.e. unbundled product

Certainly some existing brick and mortar banks will go out of business. But that's
because they fail to respond to the challenge of the Internet. The Internet and its
underlying technologies will change and transform not just banking, but also all aspects
of finance and commerce. It represents much more than a new distribution opportunity.
It will enable nimble players to leverage their brick and mortar presence to improve
customer satisfaction and gain share. It will force lethargic players who are struck with
legacy cost basis, out of business-since they are unable to bring to play in the new


Since its inception, Internet banking has experienced strong and sustained growth.
Bank report on leapfrogging in e-finance pointed out that the three countries with
impressive progress in information technology in this sense are Estonia, Republic of
Korea and Brazil. Creation of the world’s leading electronic banking systems has been
done at a remarkably low cost compared to other world-class internet banks .
In the European Union, 60 million people, representing 18 per cent of the adult
population, use online banking In France, the number of online banking accounts is
recording an annual growth rate of 75 per cent. However, Estonia is a country that has
become a leader in Internet banking (which now reaches 18 per cent of the population),
not only among Eastern European countries but in world rankings, through a
combination of easyto- use software, free-of-charge transactions and behavior changes
resulting from the influence of the Nordic countries’ IT culture on Estonia.

A sector in which Latin America is seems to be performing better than in other industries
is online retail banking. Growth in this area has been driven by traditional banks, which
have used the online channel to generate customer loyalty and improve their operating
margins. Two Brazilian banks, Bradesco and Banco do Brasil, have thus achieved more
than 4 million online customers each. Mexico is another leader of Internet banking in
Latin America. It adopted legislation providing for the development of both E-Commerce
and e-finance. In Mexico, the number of online bank users more than tripled from
700,000 in 2000 to 2.4 million in 2001, and it could reach 4.5 million in 2005 (E-Marketer
2002b). One reason for the success of Latin American banks’ online ventures seems to
be the attention they have paid to providing retail customers with multiple ways to
access their accounts (Internet, telephone, wireless). However, given that the share of
the total population that actually has a bank account is relatively small, the expansion
of Latin American online banking may be facing a bottleneck.

Compared with overall Internet usage estimated at 4.4 million in Australia, the major
banks together have attracted only 1.2 million to online banking.
The Internet is a global phenomenon and so is e-finance. Its deployment is not limited to
developed countries, and indeed some developing countries – such as India and the
Republic of Korea – are experiencing particularly strong growth in E-Banking. In Asia
one of the most impressive records has been achieved by the Republic of Korea. The
Republic of Korea is leading in online brokerage and in mobile banking. In South-East
Asia Internet banking is also developing rapidly in Thailand, Malaysia, and Singapore
and to a lesser extent, in the Philippines.

In Bangladesh there is a large gap between the computerization of foreign banks and
that of local commercial banks and as regards the state of their intra- and inter-branch
online networks. However, 75 per cent of local banks are planning to introduce E-
Banking, which implies very dynamic improvements.

Apart from North and South Africa the Sub Saharan Africa is the region that is seriously
lagging behind in Internet banking, although it is giving to the rest of the world the good
example of microfinance developments.


Literature Review

• Product and Technology group, ICICI Bank, in its paper “Corporate banking
using technology in transactions” it was inferred that Information Technology has
revolutionized the services and mode of services offered by the banks to their
corporate clients. The emergence of E-Banking has enabled the banks to offer
real-time transactions and integrate all customers’ related functions. Indian Banks
are utilizing the new technology to provide better technology and convenient
access to its customers and India is thus poised to for a huge growth in the world
of electronic banking.

• Chandana R, Unnithan, Paula M.C., Swatman in their research paper titled “E-
Banking Adaptions and Dot.Com viability: A comparison of Australian and Indian
experiences in the Banking sector” a comparative study of Australian and Indian
experiences in eBusiness was done, which seeks to identify the effectiveness of
dot.coms as indicators of eBusiness uptake and success on a sector-by-sector
basis was undertaken. It was concluded that the banking industry is now a very
mature one and banks are being forced to change rapidly as a result of open-
market forces such as the threat of competition, customer demand, and
technological innovations such as the growth of the Internet. E-Banking is a
successful strategic weapon for banks to remain profitable in a volatile, and
competitive market place of today in both Indian and Australian Economies
despite the differences of IT usage.

• G. Kannabiran and P.C. Narayan discuss in their article the experiences of a

private-sector bank in deploying Internet banking and eCommerce in India.
Strategic alignment of business and IT strategies, planning and implementation
of e-banking initiatives, and management of benefits have been captured, along
with key contributions to development.
• Huggins points to the fact that traditional boundaries in banking are
disappearing. Using eBusiness methods, major retailers and telecom providers

are starting to offer financial services to their clients. Extending the value chain
and offering versatile services seems to be the key to retaining competitiveness
in the sector. Attitudes are also shifting from direct transactions to savings and
investments, as the baby boomers reach their fortis and fifties, and prepare for

• Mario Martinez Guerreroin his paper titled “Profiling the adoption of Online
banking Services in the European Union” offers an empirical investigation on the
adoption of online banking services among European citizen. The use of e-
banking services is explained on the basis of socio-demographic and Internet –
specific behavioral indicators. The performed analyses provide support for the
influence of country, age, profession and several Internet behaviors on the use of

• The Indian Internet Banking Journey In 2001, a Reserve Bank of India survey
revealed that of 46 major banks operating in India, around 50% were either
offering Internet banking services at various levels or planned to in the near
future. According to a research report,( India Research, Kotak Securities, May
2000.) while in 2001, India's Internet user base was an estimated 9 lakh; it was
expected to reach 90 lakh by 2003. Also, while only 1% of these Internet users
utilized the Internet banking services in 1998, the Internet banking user base
increased to 16.7% by mid- 2000.



Research is defined as human activity based on intellectual application in the

investigation of matter. The primary purpose for applied research is discovering,
interpreting, and the development of methods and systems for the advancement of
human knowledge on a wide variety of scientific matters of our world and the universe.

The term research is also used to describe an entire collection of information about a
particular subject.

Methodology is the method followed while conducting the study on a particular project.
Through this methodology a systematic study is conducted on the basis of which the
basis of a report is produced.
It is a written game plan for conducting Research. Research methodology has many
dimensions. It includes not only the research methods but also considers the logic
behind the methods used in the context of the study and explains why only a particular
method or technique has been used. It also helps to understand the assumptions
underlying various techniques and by which they can decide that certain techniques will
be applicable to certain problems and other will not. Therefore in order to solve a
research problem, it is necessary to design a research methodology for the problem as
the some may differ from problem to problem.

The methodology adopted to achieve the project objective involved exploratory research
& descriptive research method. The information required for fulfilling the objective of
study was collected from various primary and secondary sources.


The main objectives of the study are:

• To study the awareness level of service class people regarding E-Banking.

• To find out the frequency and the factors that influences the adoption of E-
Banking services.

• To measure the satisfaction level of people.

• To understand the problems encountered in by service class people while using

E-Banking services(ATM, Phone banking, etc)

Type of research

This study is EXPLORATORY and DESCRIPTIVE in nature. It helps in breaking vague

problem into smaller and precise problem and emphasizes on discovering of new ideas
and insights. Exploratory research was conducted during the initial stage of the
research process which helped to refine the problem into researchable one. It has
progressively narrowed the scope of research topic.

Research design
Research design constitutes the blue print for the collection, measurement and analysis
of data. The present study seeks to identify the extent of preferences of E-Banking over
traditional banking among service class. The research design is exploratory in nature.
The research has been conducted on service class people within yamunanagar. For the
selection of the sample, convenient sampling method was adopted and an attempt has
been made to include all the age groups and gender within the service class.

Sources of data:
Following are the methods of sources of data:
Secondary data:
• Articles on E-Banking taken from journals, magazines published from time to
• Through internet.
Primary data:
Questionnaire was used to collect primary data from respondents. The questionnaire
was structured type and contained questions relating to different dimensions of e-
banking preferences among service class such as level of usage, factors influencing the
usage of e-banking services, benefits accruing to the users of e-banking services,
problems encountered. An attempt was also made to elicit reasons for its non-usage.
The questions included in the questionnaire were open-ended, dichotomous and
offering multiple choices.

Sampling technique: The sampling technique used for judgment is CONVENIENCE

Sampling unit: It defines the target population that will be sampled i.e. it answers who
is to be surveyed. In this study, the sampling unit is the people of yamunanagar.

Sampling size: It indicates the numbers of people to be surveyed. Though large

samples give more reliable results than small samples but due to constraint of time and
money, the sample size was restricted to 100 respondents. The respondents belong to
different income group and profession.

Method of data collection: The survey method is used to collect the data. Various
places of Yamunanagar visited for the purpose of collection of data.

Research instrument:
The instrument used for gathering data was questionnaire. To get further insight in to
the research problem, interview regarding their buying practices too was made. This
was done to crosscheck the authenticity of the data provided. To supplement the
primary data and to facilitate the process of drawing inference, secondary data was
collected from published sources like magazines, journals, newspapers etc.

Tools and techniques of analysis:

The data so collected will be analyzed through the application of statistical techniques,
such as bar graphs and pie charts.



 Table 1.
Awareness of people regarding e-banking service provided by the bank while
opening an account

No. of Respondents Percentage

Fully aware 37 37%
Had an idea 46 46%
No idea 17 17%
Total 100 100%
Figure 1.

Awareness about e-banking services


Fully aware
Had an idea
No idea
46% Total


As seen from Table 1, overall percentage of service class people having complete
knowledge about e-banking services provided by the bank while opening an account in
it is 37%, those having some idea about it is 46% and the percentage of people having
no awareness of e-banking services provided by the bank is 17%. It can reasonably, be
concluded that nearly 85% of the population is having awareness about e-banking

 Table 2.

Sources from which the respondents get the knowledge about the e-banking

No. of Respondents Percentage

Personal Visit 15 15%
Executive from Bank 21 21%
Advertisements 34 34%
Friends /Relatives 26 26%
Others 2 2%

Figure 2

Sources of awareness about e-banking


Personal Visit
Executive from Bank
21% Advertisements
Friends /Relatives



Table 2, indicates the percentage distribution of awareness avenues, the major are in
favour of advertisements, which score 34% among different avenues such as personal
visit, executives of the banks, advertisements and friend/relatives. While the least score
is for personal visit and that of other sources.

 Table 3.

Awareness of E-Banking services

No. of Respondents Percentage

ATM 88 26.03%
Debit Card 60 17.75%
Credit Card 50 14.79%
Phone Banking 40 11.83%
Mobile Banking 50 14.79%
Internet Banking 50 14.79%
Total 338 100%

Figure 3

Relative awareness about different e-

banking services






E-banking constitutes services provided in terms of ATMs, Debit Card, Credit Card,
Phone Banking, Mobile Banking, Internet Banking etc, of which the first six have been
covered. Amongst these ATM scores the largest used service status (26.03%) as
indicated by table 3 figures. Close on the heels is Debit card (17.75%), Credit card
(14.79%), while phone banking lags behind by scoring the least ie.,11.83%.

 Table 4

Users of E-banking services

No. of Respondents Percentage

Users 74 74%
Non Users 26 26%
Total 100 100%

Figure 4

Usage of e-banking

Non Users

Table 4 shows that among those aware (which account for 83 in number) about 74
persons use e-banking services, which is 74% of total population studied.

 Table 5.

Representation of frequency of usage

Day % W % Fort % M % Infreq %

Wise eek- ni- on- -
wise ghtl thly uently
ATM 4 36.36 31 55.3 13 37.1 11 25.5 9 13.8
6 4 8 5
Debit 2 18.18 11 19.6 7 20 10 23.2 8 12.3
Card 4 6 1
Credit 1 9.09 5 8.93 6 17.1 6 13.9 18 27.6
Card 4 5 9
Phone 0 0 2 3.57 3 8.57 7 16.2 13 20
Bankin 8
Mobile 0 0 4 7.14 4 11.4 2 4.65 9 13.8
Bankin 3 5
Interne 4 36.36 3 5.36 2 5.71 7 16.2 8 12.3
t 8 1
11 100 56 100 35 100 43 100 65 100
Figure 5

Frequency of usage of different e-banking services

60 Internet Banking
50 Mobile Banking
40 Phone Banking
30 Credit Card
20 Debit Card
10 ATM
Wise thly

Day Week-wise Fortni-ghtly Mon- Infreq-


To find out the level of usage amongst the service class, percentage has been
calculated from the total completely filled in questionnaires and the incomplete
questionnaires were discarded.
The frequency of usage of ATM is highest which is evident from table 5, followed by
debit card..

 Table 6.

Factors influencing the level of usage

Strongl More than Averag Not
than Total
y average e at all
All time
56 8 11 1 3 79
Ease of use 32 22 7 2 1 64
Nearness 21 18 14 5 0 58
Security 12 10 13 4 1 40
Direct access 32 12 7 2 0 53
Friends/ Relatives 3 8 14 7 8 40
Status symbol 7 11 14 7 10 49

Factors influencing level of

60 Not at all
40 Less than
30 average
10 More than
0 average



il i











nd ac












A study of the factors, table 6, influencing the usage was made by listing out various
factors such as all time availability, ease of use, nearness etc., and from which it came
to fore that amongst the various factors all time availability is ranked as the major
motivating factor, followed by ease of use, direct access, nearness, security in
decreasing order of importance. Quite interestingly friends and relatives, status symbol
scored the least motivating factors.

 Table 7

Various benefits accruing from E-Banking services to its users

No. of Respondents Percentage
Time Saving 70 42.42%
Inexpensive 21 12.72%
Easy Processing 40 24.24%
Easy Fund Transfer 26 15.75%
Others 8 4.85%

Figure 7

Benefits of e-banking





When asked to list various benefits accruing from the usage of e-banking, time saving
received highest percentage score at 42.42% among different benefits such as time
saving (42.42%), inexpensive (12.72%), easy processing (24.24%), easy fund
Quite interestingly, easy processing feature scored more than the inexpensiveness of
the e-banking services. The other benefits accruing to the people include ready
availability of funds, removal of middlemen and no rude customer relation executives.

 Table 8

Problems identified by the users of E-Banking service

No. of
Factors Percentage
a Time consuming 59 14.82%
b Insecurity 45 11.31%
c ATM out of order 62 15.58%
d Amount debited 39 9.80%

but not withdrawn
Problem of
e change in mobile 42 10.555
f 54 14.57%
g Card misplaced 50 12.56%
h Card misuse 47 11.81%

Figure 8

Problems identified by the users of E-Banking services

Time Insecurity ATM out of Amount Problem of Password Card Card
consuming order debited but change in forgotten misplaced misuse
not mobile
withdrawn number

No. of Respondents

Most of the users face the problem of ATM out of order (15.58%), followed by time
consuming (14.82%), password forgotten (14.57%) and then otherproblems as card
misplaced, card misuse, insecurity, etc

 Table 9

Reasons for not using E-Banking services as rated by the non users

Factors Highly More Averag Less Least Total

importan than e than importan
t averag averag t

e e
Weights 5 4 3 2 1
No need(
Satisfied with
A 19 8 22 6 22 77
It seems like
B 7 0 9 16 30 62
a botheration
C Insecurity 17 11 21 7 13 69
No access to
D internet/mobi 9 5 13 10 16 53
Lack of
E operational 12 7 12 12 15 58
F Hidden costs 21 5 14 8 16 64

Figure 9

Reasons for not using E-Banking services

Satisfied with

It seems like a




Hidden costs
No access to

Lack of
No need(


Highly important More than average Average Less than average Least important

From the non users, an attempt was made to elicit the reasons for its non usage. As
indicated by table 12, satisfaction with traditional banking was considered as prime de-
motivating factor, followed closely by the fear of insecurity, then ‘hidden cost’ factor,
which suggested their resistance to change, which to some extent can be countered by

aggressive advertisement and utilizing other modes of awareness dissemination as



• The overall percentage of servicemen having complete knowledge about e-

banking services provided by the bank while opening an account in it is 37%,
those having some idea about it is 46% and the percentage of people have no
awareness of e-banking services provided by the bank is 17%. It can reasonably,
be concluded that nearly 85% of the population is having awareness about e-
banking services.
• The percentage distribution of awareness avenues, the major skewness is in
favour of advertisements, which score 34% among different avenues such as
personal visit, executives of the banks, advertisements and friend/relatives. While
the least score is for personal visit.
• Among those aware (which account for 83 in number) about 74 persons use e-
banking services, which is 74% of total population studied.
• E-banking constitutes services provided in terms of ATMs, Debit Card, Credit
Card, Phone Banking, Mobile Banking, Internet Banking etc, of which the first six
have been covered. Amongst these ATM scores the largest used service status
(26.03%) Close on the heels is Debit card (17.75%), Credit card (14.79%), while
phone banking lags behind by scoring the least ie.,11.83 .
• To find out the level of usage amongst the service class, percentage has been
calculated from the total completely filled in questionnaires and the incomplete
questionnaires were discarded. The frequency of usage of ATM is highest
followed by debit card..
• A study of the factors, influencing the usage was made by listing out various
factors such as all time availability, ease of use, nearness etc., and amongst the
various factors all time availability is ranked as the major motivating factor,
followed by ease of use, direct access, nearness in decreasing order of
importance. Quite interestingly friends and relatives, status symbol scored the
least motivating factors.

• When asked to list various benefits accruing from the usage of e-banking, time
saving received highest percentage score at 42.42% among different benefits
such as time saving (42.42%), inexpensive (12.72%), easy processing (24.24%),
easy fund transfer(15.75%).Quite interestingly, easy processing feature scored
more than the inexpensiveness of the e-banking services. The other benefits
accruing to the people include ready availability of funds, removal of middlemen
and no rude customer relation executives.
• Among the users, various problems that are encountered while using e-banking
services. Card misuse and its misplace are major reasons that create hurdles in
its usage, while time consumption, accounting mistakes such as amount debited
but not withdrawn and change of mobile number seem to be the least bothering
• From the non users, an attempt was made to elicit the reasons for its non usage..
Satisfaction with traditional banking was considered as prime de-motivating
factor, followed closely by the fear of insecurity, then ‘hidden cost’ factor, which
suggested their resistance to change, which to some extent can be countered by
aggressive advertisement and utilizing other modes of awareness dissemination
as well.




• It has an extensive distribution network comprising of 535 branches in 312 cities &
one international office in Dubai this provides a competitive edge over the
• The Bank has a strong retail depository base & has more than million customers.
• Bank has strong brand equity.
• ISO 9001 certification for its depository & custody operations & for its backend
processing of retail operations & direct banking operation.
• The bank is a market leader in cash settlement service for the major stock
exchanges in its country.
• HDFC Bank is one of the largest private sector banks working in India.
• It has a highly automated environment in terms of information technology &
communication system.
• Infrastructure is one of the best in the country.
• It has many innovative products like kids Advantage scheme, NRI services.


• Account opening and delivery of cheque book take more time. Lack of availability
of different credit products like CC Limit, Bill discounting facilities.
• Complicated terms and conditions of products, which is not easily
understandable by the layman.


• Branch expansion
• Door step services
• Greater liberalization is foreign ownership via FDI in Indian Pvt. Sector banks.
• Infrastructure movements & better systems for trading & settlement in the Govt.
securities & foreign exchange markets.


• The bank has started facing competition from players like SBI, PNB in the
finance market itself. This may reduce the profit margins in the future.
• Some Pvt. Banks have 7 days banking.



Every research is conducted under some constraints and this research is not an
exception. Limitations of this study are as follows:-

1. There were several time constraints.

2. The study is limited to areas of yamunanagar only.

3. The sample size of only 100 was taken from the large population for the purpose
of study, so there can be difference between results of sample from total
4. The study is related to service class people only.

5. People were reluctant to go in to details because of their busy schedules.

6. Merely asking questions and recording answers may not always elicit the actual
information sought.

7. Due to continuous change in environment, what is relevant today may be

irrelevant tomorrow.



The usage of E-banking is all set to increase among the service class. The service class
at the moment is not using the services thoroughly due to various hurdling factors like
insecurity and fear of hidden costs etc. So banks should come forward with measures to
reduce the apprehensions of their customers through awareness campaigns and more
meaningful advertisements to make E-banking popular among all the age and income
groups. Further, with increasing consumer demands, banks have to constantly think of
innovative customized services to remain competitive. E-Banking is an innovative tool
that is fast becoming a necessity. It is a successful strategic weapon for banks to remain
profitable in a volatile and competitive marketplace of today.

In future, the availability of technology to ensure safety and privacy of e-transactions

and the RBI guidelines on various aspects of internet banking will definitely help in rapid
growth of internet banking in India.


Internet banking would drive us into an age of creative destruction due to non-physical
exchange, complete transparency giving rise to perfectly electronic market place and
customer supremacy. The question to be asked right now is "What the Indian Banks
should do" Whatever is the strategy chosen and options adopted, certain key
parameters would determine the bank's success on web:

For long-term success, a bank may follow:

 Adopting a webs mindset

 Catching on the first mover's advantage
 Recognizing the core competencies
 Ability to deal multiplicity with simplicity
 Senior Management initiative to transform the organization from inward to
outward looking
 Aligning roles and value propositions with the customer segments
 Redesigning optimal channel portfolio
 Acquiring new capabilities through strategic alliances.

The above can be implemented in four steps:

 Familiarizing the customer to new environment by demo version of software on

bank's web site. This should contain tour through the features which are to be
included. It will enable users to give suggestions for improvements, which can be
incorporated in later versions wherever feasible.
 Second phase provides services such as account information and balances,
statement of account, transaction tracking, mailbox, check book issue, stop
payment, financial and customized information.

 The third phase may include additional services such as fund transfers, DD
issue, standing instructions, opening fixed deposits, intimation of loss of ATM
 The last step should include advanced corporate banking services like third party
payments, utility bill payments, establishment of L/Cs, Cash Management
Services etc. Enhanced plan for the customers in future can include requests for
demand drafts and pay orders and many more to bring in the ultimate in banking

Also if proper training should be given to customer by the bank employs to open an
account will be beneficial secondly the website should be made friendlier from where
the first time customers can directly make and access there accounts.

We can see the time is changing and we he passage of time people are accepting
technology there is still a lot of perceptual blocking which hampers the growth it’s the
normal tendency of a human not to have changes work on the old track, that’s also
one of the reason for the slow acceptance of internet banking accounts.
• Give proper training to customers for using i-banking
• Create a trust in mind of customers towards security of there accounts
• Provide a platform from where the customers can access different accounts
at single time without extra charge.
• Make there sites more users friendly.
• Customers should be motivated to use I banking facilities more.



• Malhotra, T. D., “ Electronic Banking and Information Technology in Banks”

Sultan Chand and Sons, New Delhi,2008.

• S.S Kaptan & N.S. Choubey. “Indian Banking in Electronic Era”

• Internet Banking in India-Part I- Dr A. K. Mishra






Dear Respondent,
We are conducting a research study of “E-banking Preferences among people in
Yamunanagar”. We will appreciate your cooperation in this regard by filling up the
questionnaire carefully. All the information provided by you will be kept confidential.

1. In which banks do you have your account?

a. State Bank of India b. HDFC Bank
c. Punjab National Bank d. ICICI Bank
e. State Bank of Patiala f. Canara Bank
g. Bank of India h. Oriental Bank of Commerce
i. Any other, Please Specify
i. ---------------------
ii. ---------------------
iii. ---------------------

2. While opening up the account, were you aware of E-banking services provided by
your bank?
a. Fully aware b. Had an idea c. No

3. If answer to question no.2 is c, how did you get to know about E-banking services
of your bank?
a. Personal visit
b. Executive from the bank
c. Advertisements
d. Friends/ Relatives

4. If answer to question no.2 is a or b, which of the following E-banking services are

you aware of?
e. ATM
f. Debit Card
g. Credit Card
h. Phone banking
i. Mobile banking
j. Internet banking

5. Do you use E-banking services?

a. Yes b. No
(If No, answer question no. 10 directly).

6. If answer to question no.5 is yes, how frequently do you use each of the following
Once in a Once in a Once in a Once in a Infrequentl
day week fortnight month y
b Debit Card
c Credit Card
d Phone Banking
e Mobile Banking
f Internet Banking

7. Which of the following factors influence you the most to use E-banking services?

More than Less than

Factors Strongly average Not at all
average Average
a All time availability
b Ease of use
c Nearness
d Security
e Direct access
f Friends/ Relatives
g Status symbol

8. Which of the following benefits accrue to you, while using E-banking services?
a. Time saving b. Inexpensive
c. Easy processing d. d. Easy fund transfer
e. Any other, please specify__________________________________________
9. Rate the problems identified while using E-banking services?

Factors considere Major Average Minor
d e
a Time consuming
b Insecurity
c ATM out of order
d Amount debited but not
e Problem of change in
mobile number
f Password forgotten
g Card misplaced
h Misuse of card

10. Kindly rate the following reasons enlisted for not using the E-banking services?

Factors Highly More than Average Less than Least

important average average important
a No need( Satisfied with
traditional banking)
b It seems like a botheration
c Insecurity
d No access to
e Lack of operational
f Hidden costs
Any other, please specify__________________________________________
11. To what extent are you satisfied with your Banks’ E-banking services?

b. Highly Satisfied ___________

c. Satisfied _________

d. Neutral ___________

e. Dissatisfied ___________

f. Highly dissatisfied ___________

12. What other services you would like to have through E-banking?


Respondent’s Profile

Name : ________________ Income level per month

Age : ________________ Less than Rs. 10,000

Gender (M/F) : ________________ Rs.10,000 to Rs.20,000

Profession : ________________ Rs.20,000 to Rs.30,000

Organisation : ________________ More than Rs.30,000