Effectiveness of Information Technology in banks:

(A Study in HDFC Bank Srinagar)

Sabzar Ahmad Peerzadah1, Amir Hussain Shah2, Shayista Majeed3

1,2,3.
Research Scholar.Department of Commerce University of Kashmir. Srinagar J&K India.

ABSTRACT

The emergence of information technology to every aspect of human life and business has been so apparent that
it does not need to be accentuated more. Information technology has been of lifeblood in the banking system.
When we look at technology, there is tremendous scope for innovation – in the field of financial inclusion itself,
right from biometric based systems to mobile based new payment banking applications. But it cannot be a one-
size-fits-all approach. Recent years have witnessed phenomenal transformations in the operations of many
businesses, and banking sector is not an exception, due to the massive advances in Information and
Communication Technology (ICT). In this context, an attempt is made to examine the effectiveness of
Information Technology (IT) adoption on the select bank customers and employees in the Srinagar city of
Jammu and Kashmir. This study aims to investigate the effectiveness of information technology in the banking
system of HDFC Bank in Srinagar City. The study is carried out with the help of a structured questionnaire
administered to 100 selected customers and employees. The data was then analyzed with the use of the exact
percentage, mean scores and the 5-point Likert scale to determine the effectiveness of Information technology-
enabled services in the banking system affairs. The findings then proved that customers, as well as employees,
are satisfied with most of the IT-enabled services except a few for which the suggestions are given.

Key Words: Business, Banking System, Financial Inclusion, Human, Information Technology,

1. INTRODUCTION

Information technology plays a crucial role in many industries and sectors, resulting in a positive impact on
economic development beyond geographical boundaries. It is important to keep in mind that the financial sector
in general and the banking sector, in particular, was one of the first to use information technology in the 1960s
and has the record of influencing the development process through technology. The banking sector is an
example where IT infrastructures have had implications for the economic development of many nations in all
jurisdictions. Studies show that information technology along with knowledge management has great potential
to drive the development process (Okpaku, 2003) [1]. Computers become more sophisticated. They gave banks a
potential with which they could only dream and gave high expectations to bank customers. The changes that
new technologies have rejuvenated the bank and its impact on bank officials, employees and customers are
huge. Advances in technology are enabling the delivery of banking products and services more conveniently and

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effectively than ever before, thus creating new competitive foundations. The availability of critical information
and the ability to act quickly and effectively will distinguish successful banks of the future. The bank gains a
fundamental competitive advantage by having a direct and responsible marketing customer service environment
and new and optimized business processes. Needless to say, the adoption of electronic payment systems, such as
the transfer of national electronic funds (NEFT) and the real-time gross settlement system (RTGS), has also
improved the efficiency of banks.

Today, information technology has become the heart of the banking sector, while the banking sector is at the
center of every solid economy. If it collapses, so will the economy. It is absolutely evident from the current
recession, in the crisis of European banks and, in turn. TI has created a new infrastructure for the global
economy to become truly global and has also given new technology users a competitive advantage over their
rivals. The electronic banking system has become the leading technology-driven revolution in conducting
financial transactions. However, banks have invested heavily in telecommunications and electronic systems, and
users have also been validated to accept the electronic banking system as useful and easy to use (Adesina and
Ayo, 2010). Castells (2001) reveals that billions of dollars worth of transactions can now take place within a few
seconds in the electronic circuit of the world by pressing a single stop. Although IT has revolutionized the way
of life, in addition to conducting business and studying the banking sector has received more attention in the last
decade, it continues to pose challenges for marketing and academic specialists alike.According to Loonam and
O'Loughlin (2008)[2], ICT advancements, globalization, competition and changing social trends such as
heightened customer proactiveness and increased preferences for convenience have caused the intense
restructuring of the banking industry. With this brief introduction, this paper introduces the literature review, the
theoretical background, the objectives and the scope of the study, the methodology used for the study, and at the
end the conclusion with some suggestions for banks to make the most of its IT resources.

2. REVIEW OF LITERATURE

The review of some important works is carried out in the following paragraphs with an important objective to
identify the current research gap. For banks, technology has become a strategic asset to achieve greater
efficiency and, for customers, it is the realization of their banking dream anywhere, anytime, at any time. Recent
trends show that most brick and mortar banks are moving from a product-centric model to a customer-centric
model as they develop their new electronic banking capabilities. Delivery channels include direct connections,
private networks, public networks, etc. Banks increasingly use the Internet as a channel to receive directions and
provide their products and services to their customers. This form of banking is generally known as Internet
Banking, although the range of products and services offered by different banks fluctuates considerably in terms
of content and sophistication.

Brynjolfsson and Hitt (1996)[3]report the positive effects of IT based on evidence at company level. Sabita Paul,
(2013)[4] in her work described the current and rapid technological revolution that alters the whole world and has
a crucial impact in the data-driven banking sector, collected by customers of several commercial banks in

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Odisha. In the general economy, the financial flow is supported by the bank and, in today's digital economy, the
financial flow is possible through the IT banking system. Banks use IT to consolidate their position, customize
services and adopt innovative strategies to capture new market opportunities and increase profits, as well as
enhance bank process outsourcing (BPO). The author Muhammad Reza Nam(2009)[5] believes that information
and communication technologies (ICT) are the key factor in the current and future development of the financial
sector, while Internet banking and mobile banking are considered a new distribution channel, both the channels
help the bank to reduce costs and save transaction time. Saied K (2011) [6] suggested that IT leads to significant
savings in customers and employees, reducing costs and facilitating network transactions. The study by Awasthi
and Sharma (2001)[7] reveals that technological advances will change the face of banking activity. The
technology has transformed the distribution channels of banks into retail banking. The study also examined the
challenges faced by banking institutions and their regulations. Janki (2002)[8] analyzed how technology affects
employee productivity. There is no doubt that technology has changed operational efficiency and customer
services. Attention to technology will increase new products, strengthen risk management, etc. The study
concluded that technology is the only tool to achieve its goals. Rao (2002) [9] analyzed the impact of new
technologies in the banking sector.

Technology is changing the way you do business and opens up new perspectives to do the same job cheaper.
Internet banking and Internet banking are making progress that bank branches can guarantee for home banking.
Bhasin (2001)[10] analyzed the impact of IT in the financial sector. It has transformed repetitive and overlapping
systems and procedures into a simple one-button molding technology, resulting in speed, accuracy and
efficiency in conducting business and enabling them to undertake new activities. Sabnani (2002) [11]analyzed the
importance of the "universal banking system" in India. Developments in IT and telecommunications are
allowing international grouping of financial resources, thus extending the risk into more than one market. Feel
that the Universal Banking System will increase in India. Vageesh (2000)has greatly appreciated the new private
sector banks that have adopted IT.New private sector banks with their cutting-edge technology and big plans to
venture into e-banking. Banks are venturing into net banking by offering great convenience to customers, on the
one hand, and resulting in a lower transaction cost for the banking cost for banks, on the other hand. Verma
(2000)[12]analyzed the impact of IT on public sector banks and new private sector banks and noted that IT is a
threat to public sector banks, while the strength of new banks private. The new private banks are fully
computerized and provide services on the Internet, in particular ICICI Banks and HDFC Bank, which are very
active on this front and focus on the Internet and e-commerce to offer their customers.

3.THEORETICAL BACKGROUND

3.1. Information Technology and Information Communication Technology

Information Technology (IT) is a comprehensive term that covers the acquisition, processing, storage and
dissemination of information. It involves the application of computers and communication technology in the
endeavor of information handling, and information flow from the generation to the execution levels. It is

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restricted to systems resting on the microelectronic-based combination of computers and telecommunication
technologies. The IT is the boon for mankind. It gives access to information at fingertips. The promising and
diversified possibilities of IT have reduced the space and time between the people, countries, continents and
ultimately have led to the emerging concepts “Global Society” and “Global Village”.

Information Communication Technology (ICT) is a term that describes types of technology that are used
specifically for communications. It is IT, but ICT emphasis more on technologies that deal with communication
like cell phone, the internet and wireless networks and other things.We have also found it needful to offer some
definitions below although they are not part of our keywords.

3.1.1. Usability/ Time & Speed

Navigation, product information, and site design are critical to e-satisfaction (Szymanski & Hise 2000). Thus, a
key to building a usable Website is to create good links and navigation mechanisms (Mannix 1999; Radosevich
1997). An advantage of the ICT is its capacity to support interactivity for users (Palmer 2002), and online
consumers are influenced by the interactivity of the Website (Alba et al. 1997; Jarvenpaa & Todd 1997). Fast,
interactive, uncluttered, and easy-to-navigate sites with quality searching capabilities should be perceived more
favorably by consumers. The features evaluated within the attribute of usability and site design are: (1)
providing a user-friendly interface, (2) an interactive site, and (3) possessing adequate searching capabilities.

3.1.2. Product Value / Operational cost

Minimizing product cost and maximizing product quality are major factors in ICT success (Keeney 1999) [13].
Total cost includes product cost, taxes, shipping, Internet, processing cost, staff cost, maintenance cost and
travel costs (Keeney 1999). Quality is an intrinsic property of a product. Product quality is the expected standard
of product or service excellence (Jarvenpaa & Todd 1997). Brands and retailers that are well known and well
regarded from the traditional channels may translate to quality on an online channel. The question becomes how
consumers will assess product quality when they are unfamiliar with the retailer or the product brand (Jarvenpaa
& Todd 1997). Kalakota and Whinston (1996) stress the need to provide independent evaluations of goods and
services to convince consumers of the quality of the merchandise sold by the Internet merchant on the web.
Thus, the end result for the consumer should be a feeling of gratification with the purchase once completed.
Torkzadeh and Dhillon (2002)[14] combine these two objectives (product cost and product quality) into a value
of ICT measure (used in this study). The features of the product value attribute to be evaluated are: (1) post-
purchase feeling of customer gratification, (2) perceived product quality and (3) overall product cost.

3.1.3. Confidence / Security

Trust is the element of a business relationship that decides the level to which each party feels they can rely on
the integrity of the promise offered by other. The trust is identified as being an antecedent to commitment, being
the motivation to stay within the relationship and an important element of relationship marketing (Ahasanul
Haque and Ali Khatibi, 2007)[15]. Some authors suggest that for a customer to enter into a transaction’s must feel

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confident that the merchant will deliver, making trust an order qualifier for purchase decisions. Online buyers
have fewer security worries, appreciate the quickness and flexibility of online buying and see the web as making
buying easier. Websites must be made simple and easy to use, because non-users are not very confident that
they can buy online successfully (Ahasanul Haque and Ali Khatibi, 2007).

3.1.4. Communication and decision making

Communication & decision making is the users' ability to customize products according to personal preferences
(Zhu & Kraemer 2002)[16]. For example, configuring a computer and related product features directly on a
merchant's Website. Customization is one of the great advantages of online shopping (Van Slyke et al. 2004), [17]
allowing what some have termed a segment of one, where each customer is unique in his or her tastes, choices,
and acquisitions. The features of the product customization attribute to be evaluated in this study are (1) offering
a customizable product, (2) offering online configuration capabilities, and (3) the number of options that are
available for the product.

3.1.5. Job and working environment

Expertise or product knowledge and expert in the processing of the product is the understanding of the attributes
of a product or service class and knowledge about how various alternatives stack up on these alternatives.
Customers’ expertise facilitates their learning of new and more complex types of information (Ahasanul Haque
and Ali Khatibi, 2007). The two major components of customer expertise are expertise and familiarity. The
customers who are more innovative and knowledgeable with regard to the internet and its uses are more likely to
buy online from the computer industry in Malaysia than less innovative and knowledgeable customers
(Ahasanul Haque and Ali Khatibi, 2007).

3.1.6. Internal system efficiency

Commentary, that it is often repeated in terms of gaining benefits from the internet is in terms of marketing
logistic, whereby online buyers gain temporal advantage by ordering online and delivered over internet (Adam
Stewart, 2002)[18]. Electronic marketing broaden the marketing scope of internet users and allow buyers to make
transaction online with the help of information communication technology. Some researchers, specifies that
specific knowledge of the impact of attribute performance on loyalty is, therefore, a basic requirement (Adam
Stewart, 2002).

3.2. Information Technology/Computers in Banks

With the globalization trends world over it is difficult for any nation big or small, developed or developing, to
remain isolated from what is happening around. For a country like India, which is one of the most promising
emerging markets, such isolation is nearly impossible. More particularly in the field of Information technology,
where India has positively an edge over its competitors, remaining awayfromthe world trends is untenable.The
financial sector in general and banking industry, in particular, is the largest spender and beneficiary from

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information technology. This aims to relate the international tendency in it with the Indian banking industry.
The last lot includes possibly all foreign banks and newly established Private sector banks, which have fully
computerized all the operations. With these variations in the level of information technology in Indian banks, it
is useful to take account of the trends in Information technology internationally as also to see the comparative
position with Indian banks. The present article starts with the banks’ perception when they get into IT up
gradation. All the trends in IT sector are then discussed to see their relevance to the status of Indian banks. IT
Considerations Since the early nineties, each Indian bank has done some IT improvement effort. The first and
foremost compulsion is the fierce competition. While deciding on the required architecture for the IT
consideration is given to following realities.

3.2.1. Meeting Internal Requirement: The requirements of the banks are different depending on their nature and
volume of business; focus on a particular segment, the spread of branches and alike. Many a time’s banks do
have the required information but it is scattered. The operating units seldom know the purpose of gathering the
information by their higher authorities.

3.2.2. Effective in Data Handling: As stated earlier the banks have most of the needed data but are distributed.
Further, the cost of collection of data and putting the same to use is prohibitively high. The accuracy and
timeliness of data generation become the causalities in the process. Best of the intentions on computerization are
wished away because there is a non-visible reduction in cost /efforts/time required for the required data
gathering.

3.2.3. Extending Customer Services: Addressing rising customers expectations is significant particularly in the
background of increased competition. In case of bank A is unable to provide the required service at a
competitive price and in an accurate manner with speed. There is always a bank IT at its next-door waiting to
hire the customer. Awareness of customers about the availability of services and their pricing as also available
options have brought into sharp focus the issue of customer satisfaction.

3.2.4. Creative Support for New Product Development: It has become necessary for the banks to vitalize the
process of product development. Marketing functionaries need a lot of information not only from the outside
sources but also from within the banks. Banks are looking to the retail segment as the future marketplaces for
sales efforts. Having full-fledged information of existing customer is the key for this purpose. The emergences
of data requirement and an appropriate architecture to support the same are significant issues to be handled in
this regard.

3.2.5.Development of the Non-technical Staff: Banking being a service industry, it is the staff at the counters
that deliver the products. In Indian scenario, virtual banking is probably to have a few more years to establish.
The reliance on the counter staff is inevitable. The staff are large in number and the larger number is non-
technical. The customer satisfaction levels at the counter decide the ultimate benefit of IT. Giving due
consideration to this aspect in choosing the architecture is necessary.

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3.3RecentDevelopmentsinBankingSector

3.3.1. Internet: Internet is a networking of computers. In this marketing message can be transferred and received
worldwide. The data can be sent and received in any part of the world. In no time, internet facility can do many
a job for us.

3.3.2. Society for Worldwide Inter-bank Financial Telecommunications (SWIFT):SWIFT, as a co-operative

society was formed in May 1973 with 239 participating banks from 15 countries with its headquarters at
Brussels. It started functioning in May 1977. RBI, 27 public sector banks as well as 8 foreign banks in India
have acquired the membership of the SWIFT. SWIFT provides a rapid, secure, reliable and cost effective mode
of transmitting the financial messages worldwide. At present more than 3000 banks are the members of the
network. To cater to the growth in messages, SWIFT was upgraded in the 80s and this version is called SWIFT-
II. Banks in India are hooked to SWIFT-II system. SWIFT is a method of the sophisticated message
transmission of international repute. This is highly cost-effective, reliable and safe means of fund transfer. *
This network also facilitates the transfer of messages relating to fixed deposit, interest payment, debit-credit
statements, foreign exchange etc.*This service is available throughout the year, 24 hours a day. *This system
ensure against any loss of mutilation against transmission. * It serves almost all financial institution and a
selected range of other users.It is clear from the above benefits of SWIFT that it is very beneficial in productive
customer service. SWIFT has extended its range to users like brokers, trust and other agents.

3.3.3. Automated Teller Machine (ATM):ATM is an electronic machine, which is operated by the customer
himself to make deposits, withdrawals and other financial transactions. ATM is a step in improvement in
customer service. ATM facility is available to the customer 24 hours a day. The customer hss issued an ATM
card. This is a plastic card, which bears the customer’s name. This card is magnetically coded and can be read
by this machine. Each cardholder is provided with a secret personal identification number (PIN). When the
customer wants to use the card, he has to insert his plastic card in the slot of the machine. After the card is a
recognized by the machine, the customer enters his personal identification number. After establishing the
authentication of the customers, the ATM follows the customer to enter the amount to be withdrawn by him.
After processing that transaction and finding sufficient balances in his account, the output slot of ATM gives the
required cash to him. When the transaction is completed, the ATM ejects the customer’s card.

3.3.4. Cash Dispensers: Cash withdrawal is the basic service rendered by the bank branches. The cash payment
is made by the cashier or teller of the cash dispenses is an alternate to time -saving. The operations of this
machine are cheaper than manual operations and this machine is cheaper and fast than that of ATM. The
customer is provided with a plastic card, which is magnetically coated. After completing the formalities, the
machine allows the transactions for required amount.

3.3.5. Electronic Clearing Service: In 1994, RBI appointed a committee to review the mechanization in the
banks and also to review the electronic clearing service. The committee recommended in its report that
electronic clearing service-credit clearing facility should be made available to all corporate bodies/Government

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institutions for making repetitive low-value payment like dividend, interest, refund, salary, pension or
commission, it was also recommended by the committee Electronic Clearing Service-Debit clearing may be
introduced for pre-authorized debits for payments of utility bills, insurance premium and installments to leasing
and financing companies.RBI has been necessary step to introduce these schemes, initially in Chennai, Mumbai,
Calcutta and NewDelhi.

3.3.6. Bank.net: Bank net is a first national level network in India, which was commissioned in February 1991.
It is communication network established by RBI on the basis of the recommendation of the committee appointed
by it under the chairmanship of the executive director T.N.A. Lyre. Bank net has two phases:Bank net-I and
Bank net- II. Areas of Operation and Application of Bank net: (a).The message of banking transaction can be
transferred in the form of codes from the city to the other.(b). Quick settlement of transactions and advices.(c).
Improvement in customer service-withdrawal of funds is possible from any member branch.(d). Easy transfer of
data and other statements to RBI.(Useful in foreign exchange dealings).

3.3.7. Chip Card: The customer of the bank is provided with a special type of credit card which bears customer’s
name, code etc. The credit amount of the customer account is written on the card with magnetic methods. The
computer can read these magnetic spots. When the customer uses this card, the credit amount written on the card
starts decreasing. After use of number of times, at one stage, the balance becomes nil on the card. At that
juncture, the card is of no use. The customer has to deposit cash in his account for re-use of the card. Again the
credit amount is written on the card by magnetic means.

3.3.8.Phone.Banking:Customers can now make call on the bank’s designed telephone number and the customer
by dialing his/her unique ID number will be able to get connectivity to bank’s designated computer. The
software provided in the machine interactive with the computer asking him to dial the code number of service
required by him and suitably answers him. By using Automatic voice recorder (AVR) for simple queries and
transactions and staffed phone terminals for complicated queries and transactions, the customer can actually do
entire non-cash relating banking on telephone: Anywhere, Anytime.

3.3.9. Tele-banking: Tele-banking is another innovation, which provided the facility with 24-hour banking to the
customer. Tele-banking is based on the voice processing facility available on bank computers. The caller usually
a customer calls the bank anytime and can enquire balance in his account or other transaction histories. In this
system, the computers at the bank are connected to a telephone link with the help of a modem. Voice processing
facility provided in the software. This software identifies the voice of caller and provides him suitable reply.
Some banks also use the telephonic answering machine but this is limited to some brief functions. This is only
telephone answering system and now Tele-banking. Tele banking is becoming popular since queries at ATM’s
are now becoming too long.

3.3.10. Internet Banking: Internet banking enables a customer to do banking transactions through the bank’s
website on the Internet. It is a system of accessing accounts and general information on bank products and
services through a computer while sitting in its office or home. This is also called virtual banking. It is more or

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less bringing the bank to your computer. In traditional banking one has to approach the branch in person, to
withdraw cash or deposit a cheque or request a statement of accounts etc. but internet banking has changed the
way of banking. Now one can operate all these type of transactions on his computer through the website of the
bank. All such transactions are encrypted; using sophisticated multi-layered security architecture, including
firewalls and filters. One can be assured that one’s transactions are secure and confidential.

3.3.11. Mobile Banking: Mobile banking facility is an extension of internet banking. The bank is in association
with the cellular service providers offers this service. For this service, the mobile phone should either be SMS or
WAP enabled. These facilities are available even to those customers with only credit card accounts with the
bank.

3.3.12. Anywhere Banking: With expansion of technology, it is now possible to obtain financial details from the
bank from remote locations. The basic transaction can be effected from faraway places. Automated Teller
Machines are playing an important role in providing remote services to the customers. Withdrawals from other
stations have been possible due to the inter-station connectivity of ATM’s. The Rangarajan committee had also
suggested the installation of ATM at non-branch locations, airports, hotels, Railway stations, Office Computers,
Remote Banking is being further extended to the customer’s office and home.

3.3.13. Voice Mail: Talking of answering systems, there are many banks mainly foreign banksoffering very
advanced touch-tone telephone answering service which route the customer call straight to the department
concerned and allow the customer to leave a message for the concerned desk or department if the person is not
available.

4. OBJECTIVES OF THE STUDY

The main objective of this research is to focus on the role of modern technology and its effectiveness in the
banking services of the select bank. The specific objectives of the study are:

 To know the frequency of usage of different IT-enabled banking services;

 To know the satisfaction of customers and employees with the IT-enabled services;
 To know the difficulties faced by the customers and employees by using the IT-enabled banking services.

5. SCOPE OF THE STUDY

The present study “Effectiveness of Banking Services” was carried out in the capital city as a micro-study but
not covered sample banks either at the national level or Jammu and Kashmir level is one of the limitations to
this study. Further, it has considered only a limited number of parameters for measuring the effectiveness of
banking services of only HDFC Bank is to be considered as another limitation.

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6. RESEARCH METHODOLOGY

For collecting the data, both primary and secondary sources were used and the major portion of the study relies
on primary data which was collected with thehelp of a structured questionnaire. Secondary data was also used
from related books, journal and websites of the select banks included in this study. The present study aims at
understanding the impact of Information Technology on Banks and attempts to measure the effectiveness, from
the point of view of the customers and employees. The study was conducted in the summer capital (city) of
Jammu and Kashmir. In all, 100 customers and employees (50 each) of the samplebank were selected randomly.
The idea of implementation of technology in the banks is to provide the customers with the best of their services
accordingly an attempt has been made in this paper to measure the effectiveness of banking services, In the
study three and four parameters were considered while collecting the information from the customers and
employees respectively.

7. RESULTS AND INTERPRETATION

The research brought to light the fact that IT has been of great impact on banks in the sample city. The findings
both from the questionnaires and the library research reveal that IT leads to saving the time of the customers and
the employees conspicuously, cutting down the expenses and facilitating the network transactions. The details
are as follows: Regarding the first category of respondents’ research question about (effectiveness/satisfaction)
among the respondents (customers) the following were the results:(1a). That among customers the most
dominant factor in ATM services is the quality of currency notes with mean= 4.04 and the overall mean of ATM
services =3.7050.(1b).That among customers the most dominant factor in Net banking is E-payments with
mean=4.44 and the overall mean is 3.8120.(1c).That among customers the most dominant factor in Mobile
banking is SMS alert service with mean = 4.08 and the overall mean =3.8450.(1d).That the customers are
neutral in terms of Tele banking services with mean =2.92. So, overall the customers are satisfied with E-
banking(mean=3.5705).As regards the difficulties faced by the customers while using IT-enabled banking
services are less famous Tele banking and the modern sophisticated IT services.

Regarding the second category of respondents research question about (effectiveness/satisfaction) among the
respondents (employees) the following were the results:(2a).That among the employees the most dominant
factor in BEHAVIOURAL FACTOR ANALYSIS is that it helps the employees to do their routine work more
efficiently with mean =4.10 and the overall mean is 3.8867.(2b).That among the employees the most dominant
factor in MANAGEMENT FACTOR ANALYSIS is that it empowered the employees to solve their problems
more efficiently with mean = 4.22 and the overall mean =3.8971. (2c).That among the employees the most
dominant factor in CUSTOMER ORIENTATION ANANLYSIS is that the customers carry out more
transactions with e-banks than traditional banks with mean=4.02 and the overall mean is 3.8533.(2d).That shows
that among the employees the most dominant factor in EMPLOYEE BENEFIT ANALYSIS is that it saves the
time of the employees working in e banks with mean = 4.12 and the overall mean is 3.8829.So, overall the
employees are satisfied with e banking (mean =3.8800).

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8. CONCLUSION AND SUGGESTIONS:

8.1Conclusion:

A sound and effective banking system is the backbone of an economy. The economy of a country can function
smoothly and without any hassle less if the banking system is not only flexible but also capable of meeting the
new challenges posed by the technology and other external as well as internal factors. The importance and role
of information technology for achieving this objective cannot be undermined. Technology advances have
accelerated changes resulting in higher production of goods & services. The information technology has
transformed the functioning of business across the world. It bridged the gap in terms of both reach and the
coverage of system and in the process enabling better decision making based on latest and accurate information
and improvement in efficiency through various new processes, products and services offered by state-owned
banks, private sector banks and foreign banks and financial institutions. The transformation in banking services
is providing various advantages to customers at anytime, anywhere access to their accounts as well as the power
to operate their accounts. Although the change is good still banks are required to address the important issues to
get the full benefits of information technology implementation. The banks need to aware the customers about
the less famous and least used IT-enabled services, as well as customers, should be given awareness and training
about the usage of newly introduced sophisticated e-banking services.

8.2. Suggestions:

The study highlights the following suggestions: (a) The customer being the primary purpose of any industry and
for banking too, it is essential to understand their needs, concerns, expectations and grievances handling.(b)
Customers are no longer passive in their preferences and hence to survive, the banks need to make customer a
part of their business.(c)To give customers required awareness and training about the newly introduced
sophisticated IT services;(d) Market conditions need to be studied from time to time and there is a need to
develop the solutions to handle the trends in the modern banking technologies for improving banking
services.(e)To commence IT adoption more in their day-to-day life; (f) To devise/compile the best and speedy
services to the customers with the new banking technologies; (g)To encourage the customers to use internet
banking service to reduce the time and additional manpower work; and(h) To provide the best IT services of
Electronic fund transfer in Internet Banking with the safety and security system. (i) To make the customers
aware of the less famous IT-enabled services.

9. LIMITATIONS OF THE STUDY

(a)The questionnaires were filled by 50 employees working in different branches of the HDFC Bank in Srinagar,
so the scope of sample findings was less.(b) The questionnaire was filled by 50 employees and 50 customers of
different designations. So the point of view of employees and customers differs as per their designations. (c) The
employees from whom the questionnaires are filled are in a heavy workload so some of the questionnaires filled
by the employees who are in stress cannot be called reasonable. (d)The response of the an employee or customer

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may not be always accurate as the problem of language and understanding arises. (e) One of the other problems
of the questionnaire is the cost. Sometimes it may possible that even by spending so much the result may not be
reasonable. (f) Many a time the employees may not be really conscious or may not be bothered by the
questionnaire. This may create a problem in the research. (g) Some customers and employees treat filling a
questionnaire a futile exercise, which creates a problem for the researcher.

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