MADDAWALABU UNIVERSITY

COLLEGE OF BUSINESS AND ECONOMICS

DEPARTMENT OF MARKETING

THE IMPACT OF INTERNET BANKING ON SERVICE DELIVERY AND

CUSTOMER SATISFACTION ON CBE: (THE CASE OF BALE ROBE
DISTRICT)

By: Chaltu Kedir (PGE/18595/12)

Advisor: Abiy Worku (PhD)

May, 2022

Bale Robe, Ethiopia

 MADDAWALABU UNIVERSITY

COLLEGE OF BUSINESS AND ECONOMICS

DEPARTMENT OF MARKETING

THE IMPACT OF INTERNET BANKING ON SERVICE DELIVERY AND

CUSTOMER SATISFACTION ON CBE: (THE CASE OF BALE ROBE
DISTRICT)

BY: Chaltu Kedir

ADVISOR: Abiy Worku (PHD)

SUBMITTED TO:

Madda Walabu University, College Of Business and Economics, Department Of

Marketing Management for Partial Fulfillment of MA Degree in Marketing

May, 2022

Bale Robe, Ethiopia

 Approval Sheet
MADDA WALABU UNIVERSITY
COLLEGE OF BUSINESS AND ECONOMICS
DEPARTMENT OF MARKETING

THE IMPACT OF INTERNET BANKING ON SERVICE DELIVERY AND

CUSTOMER SATISFACTION ON CBE: (THE CASE OF BALE ROBE
DISTRICT)

BY
Chaltu Kedir

Approved by the Board of Examiners:

_________________________ ______________________
Dean, Graduate Studies Signature & Date
_________________________ ______________________
Advisor Signature & Date
_________________________ ______________________
External Examiner Signature & Date
_________________________ ______________________
Internal Examiner Signature& Date

ii
 Declaration
I,Chaltu Kedir,declare that this research, titled “The Impact of Internet Banking on Service
delivery and Customer Satisfaction on Commercial Bank of Ethiopia: (The Case of Bale Robe
District)”is done with my own effort. I have produced it independently except for the guidance
and suggestions of my research advisor. I assure that this study has not been submitted for any
scholarly award in this or any other university.

Chaltu Kedir

Signature ––––––––––––––––––––– Date ––––––––––

iii
 Certification
Here with I state that Chaltu Kedir has carried out this research work on the topic entitled “The
Impact of Internet Banking on Service delivery and Customer Satisfaction on Commercial
Bank of Ethiopia: (The Case of Bale Robe District)” under my supervision.

This work is original in nature and has not presented for a degree in any university and it is
sufficient for submission for the partial fulfillment for the award of MSc degree in Marketing.

Abiy Worku (PHD)

Signature ––––––––––––––––––––– Date –––––––––––

iv
Contents
Approval Sheet................................................................................................................................ii
Declaration.....................................................................................................................................iii
Certification....................................................................................................................................iv
List of Table.................................................................................................................................viii
List of Figure..................................................................................................................................ix
Acknowledgement...........................................................................................................................x
Acronyms........................................................................................................................................xi
Abstract..........................................................................................................................................xii
1. INTRODUCTION....................................................................................................................1
1.1. Background of the Study...................................................................................................1
1.2. Statement of the Problem..................................................................................................3
1.3. Research Question.............................................................................................................5
1.4. Objectives of the Study.....................................................................................................5
1.4.1. General Objective......................................................................................................5
1.4.2. Specific Objectives....................................................................................................5
1.5. Research Hypothesis.........................................................................................................5
1.6. Scope of the Study and Limitation....................................................................................6
1.7. Significance of the Study..................................................................................................6
1.8. Organization of the Paper.................................................................................................6
CHAPTER TWO.............................................................................................................................7
2. LITRATURE REVIEW...........................................................................................................7
2.1. Overview of the Ethiopian Banking System.....................................................................7
2.2. Information and Communication Technology..................................................................8
2.3. Review of Software used by CBE.....................................................................................9
2.3.1. GSM Banking..........................................................................................................10
2.3.2. Automated Teller Machines (ATMs)......................................................................10
2.3.3. Mobile Banking.......................................................................................................10
2.4. Challenges of Internet in Banking..................................................................................11
2.5. Service quality and Customer Satisfaction.....................................................................12
2.6. Customer Satisfaction.....................................................................................................12

v
 2.6.1. Customer Loyalty....................................................................................................14
2.6.2. Trust.........................................................................................................................15
2.6.3. Risk..........................................................................................................................16
2.6.4. Security....................................................................................................................17
2.6.5. Assurance.................................................................................................................18
2.6.6. Reliability................................................................................................................19
2.6.7. Customer Expectation..............................................................................................19
2.7. Empirical Literature Review...........................................................................................21
2.8. Conceptual Framework...................................................................................................22
CHAPTER THREE.......................................................................................................................24
3. RESEARCH METHODOLOGY...........................................................................................24
3.1. Description of the study area..........................................................................................24
3.2. Research Design..............................................................................................................24
3.3. Research approach..........................................................................................................24
3.4. Source of data..................................................................................................................24
3.5. Data collection tools........................................................................................................25
3.6. Sampling techniques.......................................................................................................25
3.7. Sample Size.....................................................................................................................25
3.8. Methods of Data analysis................................................................................................25
3.9. Model Specification........................................................................................................26
3.10. Ethical consideration.......................................................................................................26
CHAPTER FOUR.........................................................................................................................27
4. DATA ANALYSIS AND SUMMARY OF FINDING.........................................................27
4.1. Descriptive Statics...........................................................................................................27
4.1.1. Gender......................................................................................................................27
4.1.2. Age...........................................................................................................................28
4.1.3. Marital Status...........................................................................................................29
4.1.4. Monthly Income.......................................................................................................30
4.1.5. Qualification............................................................................................................31
4.1.6. How Long Have You Been Using Internet Banking...............................................32
4.2. Statistical Analysis of Variables.....................................................................................33
4.2.1. Internet Banking......................................................................................................33

vi
 4.3. Customer Satisfaction.....................................................................................................35
4.4. Correlation......................................................................................................................37
4.5. Regression Analysis........................................................................................................37
4.6. Normality Test................................................................................................................39
4.7. Result hypothesis............................................................................................................41
CHAPTER FIVE...........................................................................................................................42
5. FINDING, CONCLUSSION AND RECOMMENDATION................................................42
5.1. Findings...........................................................................................................................42
5.2. Conclusion......................................................................................................................43
5.3. Recommendation............................................................................................................44
REFERRENCE..............................................................................................................................46

vii
 List of Table
Table 1: gender of respondents
Table 2age
Table 3: Marital status
Table 4: monthly income
Table 5: educational qualification
Table 6: How long have you been using internet banking?
Table 7: internet banking
Table 8: Customer satisfaction
Table 9: Correlations
Table 10: Model Summary
Table 11: ANOVA
Table 12 Coefficients
Table 13 Normality test…………………………………………………………………...

viii
 List of Figure
Figure 1Conceptual framework of the study............................................................................22
Figure 2Gender of respondents...................................................................................................28
Figure 3 Age of Respondents.......................................................................................................29
Figure 4 Marital status of respondents.......................................................................................30
Figure 5 monthly income of respondents...................................................................................31
Figure 6 educational qualification of respondents....................................................................32
Figure 7: How long have you been using internet banking?...................................................33
Figure 8 Normality distribution of Customer satisfaction.......................................................40

ix
 Acknowledgement
Primarily, I would like to thank the Almighty God for His help. The completion of this thesis
involved kindly contribution, support and encouragement of many people. I wish to express my
sincere gratitude to my advisor Abiy Worku (PHD) for his encouragement, and support. Without
his understanding, patience and useful supervision, it could be more challenging for me to
complete this thesis.

I am also very thankful to family and friends for their support and encouragement. Finally, I also
show my appreciation to CBE, Bale Robe District staff for their patience and cooperation in
filling questioners and providing necessary information through my thesis work.

Chaltu Kedir

x
 Acronyms
CBE= Commercial Bank of Ethiopia
CS= Customer satisfaction
IB= Internet banking
NBE= National Bank of Ethiopia.

SPSS= Statistical Package for Social Sciences.

xi
 Abstract
The main objective of this study to determine how is internet banking influence of customer
satisfaction, in this study customer satisfaction is a dependent variable including the dimensions
of service quality such as customer expectation, reliability, assurance, customer loyalty, risk,
trust and security in another hand the independent variable is internet banking. The present
study is a quantitative investigation was adopted by the researcher and primary data were
collected from respondents of internet banking users of commercial bank of Ethiopia Bale robe
district by follow using the survey method and focus on the questionnaire and interview to get
the specific data in the range of area. 200 questionnaires randomly distributed and 191 were
returned by customers and it means that only 9 of them non-return and the customers from those
banks where provide the internet banking service, however, the data were analyzed by the SPSS
software version 22 and researcher used different statistical technique such as reliability test,
Cronbach’s alpha, correlation and regression, based on the results internet banking has a
positive and significant correlation with customer satisfaction. Therefore, the internet banking
has a positive impact on customer satisfaction significantly. The data has in a high level of
reliability and according to the recommendations the banks should adopt and follow the internet
banking service and decrease the cost and frees on service.

Key words: Internet Banking, Customer satisfaction, Service quality, ICT

xii
 1. INTRODUCTION
1.1. Background of the Study
Today’s business environment is very dynamic and undergoes rapid changes as a result of
technological innovation, increased awareness and demands from customers. Business
organizations, especially the banking industry of the 21st century operates in a complex and
competitive environment characterized by these changing conditions and highly
unpredictable economic climate. Information and Communication Technology (ICT) is at
the center of this global change curve. Laudon D.P and Laudon J.P, (1991) contend that
managers cannot ignore Information Systems because they play a critical role in
contemporary organization.

Internet is a man-made resource, embracing principally the electronic technologies of

computers and telecommunications (voice, data, and video) and comprising of both
electronic hardware and computer software. The significance of IT in today’s successful
organization cannot be underestimated. It plays a major role in the success of the
organization in today’s highly competitive world by providing easy and fast means of
collecting, storing, retrieving, processing, transmitting and distributing information. There
can be various other factors that determine the success of a firm, and a firm may use various
strategies to pursue the path of success. However, fast and easy access of information
through the use of IT is very important to the firm because it influences all the other success
factors, and the competitive strategies cannot be practically implemented without its
support. Therefore, no business-firm that minimizes the use of IT can attain the topmost
position in its business. This is very much true in the case of financial institutions, which
include commercial banks (Loonam, 2008).

Commercial banks have a major role in the economic development of a country. They are
the major financial intermediaries between the sources of funds and the users of funds and
their business is heavily dependent on information related to the fund market, which
includes fund suppliers, fund users, brokers; information related to the central bank, and
Ministry of Finance directives that they have to follow; and information related to their
competitors. Besides, their business also includes providing financial information to their
customers. Hence, commercial banks are highly information intensive, and the use of IT by
 them, for easy and fast means of information collection, storage, retrieval, processing,
transmission, and distribution of information, should have extensive contribution to their
performance.

One of the modern yardsticks used for rating a modern business enterprise is its ICT
infrastructural layout. This is an indication of the importance of ICT for business
establishments. Banks in particular adopt information and communication technology to
improve the efficiency and effectiveness of services offered to customers, improve business
processes, as well as to enhance managerial decision making and work group
collaborations. This helps strengthen their competitive positions in rapidly changing
/emerging economies. Environmental, organizational and technological factors are creating
a highly competitive business environment in which customers are the focal point (EfraimT.
Dorothy L., Ephraim M., and James W., 2011).

Osabuohien,(2008) established that while the gender of the bank officials does not affect
efficiency in ICT use, factors such as age, educational qualification, computer literacy and
type of ICT gadgets, were significant in influencing banks “intensity of ICT usage. Also
ICT was found to impact positively the speed of banking service delivery, as well as
productivity and profitability.

Bhaskar R.and Tewdros Sisay (2011) stated that, CBE’s operational improvement plans will
modernize its services to its growing client base in Ethiopia as part of its vision to become a
World Class bank in the region. CBE is a government owned bank which offers arrange of
retail banking services, which has already opened a subsidiary company in Southern Sudan
with plans to extend its services to other East African countries.

“Temenos’’ software delivers all the functionality and efficiencies we need to match a
world class commercial bank. Its dedicated investment in product development to
continually meet the needs of its clients and their customers was a very compelling
proposition for us. The lack of flexibility and homogeneity in our current systems impacts
product innovation, service delivery, risk management and cost control. Being able to
replace all systems with T24 will deliver a single view of the business and customer and
therefore provide a better understanding of our customers to improve services, enable us to
effectively monitor and manage risk and lower our total cost of ownership. We will have an
enormous wealth of functionality and flexibility to develop a wide range of new products,

2
 enabling us to strengthen our presence in there tail space, as well as penetrate new markets
in the face of increased competition. By using this software CBE is going to provide to their
customers better services like E-banking, Mobile banking etc. Temenos software was
benchmarked against solutions from Oracle FS and Infosys and proved to be the most
functionally rich plat form to deliver end to end operational support and broaden CBE’s
service offering, such as mobile banking, to enter new markets haskaret al. (2011).

According to Wali (2010) the relationship between ICT and the various organizational
activities is similar to government & civil servants while Government outlines policies and
civil servants execute those policies. ICT acts as a tool for the actualization of various
organizational activities in order to implement and enforce policies. However, the purpose
of this study is to show the challenges of internet on service delivery and customer
satisfaction the case of Commercial Bank of Ethiopia Bale Robe districts.

1.2. Statement of the Problem

Today, information and communication technology has become the heart of banking sector,
while banking industry is the heart of every robust economy. If it collapses so will the economy.
It is absolutely evident from the current recession, in European banks‟ crises, and in turn. ICT
has created a new infrastructure for the world economy to become truly global and also provided
the users of new technology a competitive advantage over their rivals. Electronic banking system
has become the main technology driven revolution in conducting financial transactions.
However, banks have made huge investments in telecommunication and electronic systems,
users have also been validated to accept electronic banking system as useful and easy to use
(Berger A. N. 2003).

Internet directly affects how managers decide, how they plan and what products and services are
offered in the banking industry. It has continued to change the way banks and their corporate
relationships are organized worldwide and the variety of innovative devices available to enhance
the speed and quality of service delivery.

Technology is no longer being used simply as a means for automating processes. Instead it is
being used as a revolutionary means of delivering services to customers. The adoption of
technology has led to the following benefits; greater productivity, profitability, and efficiency;

3
faster service and customer satisfaction; convenience and flexibility; and space and cost savings
(Sivakumaran, 2005).

As Bhaskaretal. (2011) showed Ethiopia is lagging behind in the adaption of E-commerce. The
software used in the Ethiopian banking industry is almost same as the rest of the African nations
like South Africa, Egypt and Tunisia. The internet infrastructure is available only in their major
cities due to lack of internet facility it is very difficult to engage E-commerce activities in the
Sub-urban and rural areas. Now a day some of the banks providing best services to their
customers with advanced software and technology, but they are suffering with security issues.

Even if Ethiopia is one of the fastest developing countries in Africa the Ethiopian banking
system is still under developing. Ethiopian banking system is comparatively good, but the
Electronic banking system is relatively not at in use. Currently Commercial Bank of Ethiopia
starts some E- banking services such as Automatic Teller Machine (ATM) service, Internet
Banking, Mobile Banking and other services. But compared to other developing countries in
Africa it is still at the beginning stage. Due to various reasons the use of Information Technology
on the banking services is limited. Hence even if it is limited, Information technology has impact
on banking service in Ethiopia.

Conversely, in countries where the telecommunications infrastructure is weak, this can act as a
significant brake on development and imposes economic costs on all groups in society: these
include increased transaction costs for business, reduced efficiency of markets; and lower
productivity, amongst others. Government is not immune from the effects either: improved
communications technologies can increase the effectiveness of public service delivery and
reduce its cost; poor infrastructure prevents the realization of such benefits. Regardless of the
indicator used, Ethiopia’s telecommunications infrastructure is lagging behind. The existing
weak telecommunications infrastructure in Ethiopia acts as a severe constraint on the
development of the Ethiopian business community and imposes additional costs on business
activities (Dominique Baron, 2010).

Here in Ethiopia there is frequent power and telecommunication service interruption. These
basic service interruptions have greater impact on the operations of Commercial Bank of
Ethiopia. When there is interruption in telecommunication, it directly leads to frequent ATM

4
break downs, the inability to access funds at other branches, referrals to branches due to network
break down as it affects the Automatic Teller Machines, POS machines, and in general the whole
activity of the bank if so the bank will fail to achieve its strategic goals. This in turn affects the
service delivery and customer satisfaction of Commercial Bank of Ethiopia.

Therefore, the researcher is interested to assess the challenges of Internet i.e. modern banking
technology on service delivery and customer satisfaction of banking service by analyzing the
case of Commercial Bank of Ethiopia under Bale robe district.

1.3. Research Question

To this end the following Research questions are developed;
What is the level of customer understanding on internet banking service?
What is the effect of internet banking on customer satisfaction on CBE?
Does internet have an impact on process efficiency of CBE?

1.4. Objectives of the Study

1.4.1. General Objective
The general objective of the study is to assess the impact of internet on service delivery and
customer satisfaction on CBE Bale Robe district.

1.4.2. Specific Objectives

The specific objectives of this study are;
To identify the customers understanding of internet banking service delivery of CBE bale
robe district,
To show the impact of internet banking on customer satisfaction,
To investigate the impact of internet banking on the efficiency of service on CBE.

1.5. Research Hypothesis

H0: internet banking has a positive and significant impact on customer satisfaction.

H1: internet banking has no a positive and significant impact on customer satisfaction.

5
1.6. Scope of the Study and Limitation
This study was emphasized mainly on analyzing the challenges of internet on service delivery
and customer satisfaction the case of Commercial Bank of Ethiopia. Geographically, the study
cover only branches located within Bale robe districts. During the course of this study there was
some issues affecting the research in generating expected out comes or information.

1.7. Significance of the Study

The study is expected to have different significances like;-
1. It would provide relevant information to management and planners of Commercial
Banks of Ethiopia regarding the impact of Internet service on banking services,
2. Recommendations forwarded would be useful to address the strategic issues of banks
especially issues regarding related products. Hence, policy makers can use this study to
draw some policy implications,
3. It would serve as a reference material for other researchers who conduct their study in
related topics.

1.8. Organization of the Paper

The study is organized in to five chapters. The first chapter deals with background of the study,
statement of the problem, objective of study, scope of study, significance of study, limitation
and organization of the research.

Relevant literature related to the study was be reviewed in chapter two. Chapter three focuses
with the description of the study area, materials and methods of the study. In chapter four, the
results obtained from the descriptive statistics and econometric models was tried to be presented
and discussed. Finally, chapter five deals with the conclusion and recommendations and
implication for future research.

6
 CHAPTER TWO
2. LITRATURE REVIEW
Under this chapter the theoretical and empirical evidences focusing on the challenges of Internet
on bank service efficiency are presented and have three sections. Accordingly, the first section
presents overview of banking service in Ethiopia. The second section presents the impacts of
information technology on banking service. Review of Software Technologies used by
Commercial Bank of Ethiopian and Forms of ICT Innovations in Banking Sector are
presented in the third and fourth sections respectively. And the last section presents review of
earlier studies on the impact of ICT on banking service.

2.1. Overview of the Ethiopian Banking System

Traditional institutions organized with a sense of cooperation and risk sharing has enabled
Ethiopians to experience saving and financial management within its cultural context. Equb and
Edir are some of the informal financial institutions that shaped the social bond and interaction
(Gebeyaw Aychile2008).

Modern banking in Ethiopia started in 1905 with the establishment of Bank of Abyssinia, which
was based on a fifty year franchise given to the British-owned National Bank of Egypt. It has
landmark significance in introducing financial services, which were hitherto unknown in the
country (Alemayehu G. 2006). A significance feature of commercial banking in Ethiopia then
was its innovative nature rather than its contribution to growth and its competitive nature. As the
society was new for the banking service, banks had faced difficulty in familiarizing the public
and they faced considerable cost of installation. In the pre-1974 era, there hardly was any
banking competitive environment, as the banking industry was dominated largely by a single
government owned bank, State Bank of Ethiopia. Despite the efforts made to disengage banking
from foreign control and to make the institution responsible to Ethiopia’s credit needs, these
developments did not bring about meaningful competitive environment, as banking industry was
characterized by specialization and low level of business. The establishment of privately owned
Addis Ababa Bank in 1964 and its growing branch network created relatively better banking
competition among commercial banks, with concentration of their branch offices in big towns
and trade routes in the country. The monetary and banking system gave at most emphasis to

7
stability and balanced growth of the economy rather than competition
(proclamationNo.206/1963). Competition during the period was generally weak. During the
Derge regime competition among banks was not taking place during this regime as it was
characterized as command economy, instead of market oriented.

2.2. Information and Communication Technology

Information Technology (IT) is the automation of processes, controls, and information
production using computers, telecommunications, software and ancillary equipment such as
automated teller machine and debit cards. It is a term that generally covers the harnessing of
electronic technology for the information needs of a business at all levels. Communication is the
conveyance or transmission of information from one point to another through a medium
(Alawode, Ademola John and Emmanuel Uche Kaka, 2008).

Information and Communication Technology (ICT) is the automation of processes, controls, and
information production using computers, telecommunications, software and other gadget that
ensure smooth and efficient running of activities. It is a term that largely covers the coupling of
electronic technology for the information needs of a business at all levels. ICT has surpassed the
role of support services or only electronic data processing; its fields of applications are slightly
global and unlimited. Its devices especially the Internet and modern computer email facilities
have further strengthened early modernizations like the telephone and fax. Other ICT devices
include data recognition equipment, factory automation hardware and services, telecommuting
and teleconferences using real time and online system (Adeoti, 2005).

It is a concept that is having a remarkable effect on almost entire aspects of the human
endeavors. This implies that it involves the application of principles to engage physical
component in achieving an intended goal. The merging of computer and telecommunication after
about four decades of applying computers to routine data processing, mainly in information
storage and retrieval, has created a new development where information has become the engine
of growth around the world. This development has created catch-up opportunities for developing
countries such as Nigeria to attain desired levels of development without necessarily
„reinventing the wheels‟ of economic growth. This new technology has brought far-reaching
revolution in societies, which has tremendously transformed most business (banking) scenes
(Ovia, 2005).

8
2.3. Review of Software used by CBE
Ethiopia is one of the fastest developing countries in Africa. The Ethiopian banking system is
still under developing. The fallowing part reviews software technologies and services offered to
customers by Commercial Bank of Ethiopia.

Commercial Bank of Ethiopia (CBE), the country’s largest bank with more than two million
customers, has selected Temenos (SIX: TEMN), the market leading provider of banking
software. Founded in 1993 and listed on the Swiss Stock Exchange (SIX: TEMN), Temenos
Group AG is a global provider of banking software systems in the Retail, Corporate &
Correspondent, Universal, Private, Islamic and Microfinance & Community banking markets.

Headquartered in Geneva with56 offices worldwide, Temenos serves over 1000 customers
in more than 120 countries. Temenos‟ software products provide advanced technology and
rich functionality, incorporating best practice processes that leverage Temenos‟ experience in
over 600 implementations around the globe. Temenos‟ advanced and automated implementation
approach, provided by its strong Client Services organization, ensures efficient and low-risk core
banking platform migrations. They announced that to transform its entire operational
infrastructure across more than 200 branches.

CBE‟s operational improvement plans will modernize its services to its growing client base in
Ethiopia as part of its vision to become a World Class bank in the region. CBE is a government
owned bank which offers a range of retail banking services, which has already opened a
subsidiary company in Southern Sudan with plans to extend its services to other East African
countries. “Temenos‟ software delivers all the functionality and efficiencies we need to match a
world class commercial bank. Its dedicated investment in product development to continually
meet the needs of its clients and their customers was a very compelling proposition for us. The
lack of flexibility and homogeneity in our current systems impacts product innovation, service
delivery, risk management and cost control. Being able to replace all systems with T24 will
deliver a single view of the business and customer and therefore provide a better understanding
of our customers to improve services, enable us to effectively monitor and manage risk and
lower our total cost of ownership. We will have an enormous wealth of functionality and
flexibility to develop a wide range of new products, enabling us to strengthen our presence in the
retail space, as well as penetrate new markets in the face of increased competition. By using this

9
software CBE is going to provide to their customers better services like E-banking, Mobile
banking etc. Temenos‟ software was benchmarked against solutions from Oracle FS and Infosys
and proved to be the most functionally rich platform to deliver end to end operational support
and broaden CBE‟s service offering, such as mobile banking, to enter new markets.

2.3.1. GSM Banking

This mode of e-banking makes use of the Global System for Mobile communication (GSM)
phones as the primary electronic device. GSM has improved the operational efficiency of many
banks in the country. The mobile banking services basically allow customers to operate their
accounts with the operating banks from mobile phones to a large extent as long as their phones
and network support SMS (short messaging service). The user could be able to check account
balance up to his two last transactions.

2.3.2. Automated Teller Machines (ATMs)

ATMs are a computer-controlled device that dispenses cash, and may provide other services to
customers who identify themselves with a Personal Identification Number. ATM dispenses cash
at any time of the day and night, unlike the traditional method where customers have to queue for
a very long time in order to withdraw cash or transfer funds. An ATM device allows a bank
customer to withdraw cash from his account via a cash dispenser (Machine), and the account is
debited immediately. A fundamental advantage is that it needs not to be located within the
banking premises. It is usually in stores, shopping malls, fuel stations etc. It saves customers
time in service delivery as alternative to queuing in bank halls, customers can invest such time
saved into other productive activities. ATMs are a cost-efficient way of yielding higher
productivity as they achieve higher productivity per period of time than human tellers.

2.3.3. Mobile Banking

Mobile Banking refers to provision and avail of banking- and financial services with the help of
mobile telecommunication devices. The scope of offered services may include facilities to
conduct bank and stock market transactions, to administer accounts and to access customized
information. Mobile banking is being regarded in the industry as “the delivery channel of the
future” for various reasons. First and foremost is the convenience and portability afforded. It is
just like having a bank in the pocket. Other key reasons include the higher level of security in
comparison to the internet and relatively low costs involved. The possibility that customers will

10
adopt mobile banking is high, considering the exponential growth of mobile phone users
worldwide. Mobile banking typically provides services such as the last information on account
balance, previous transactions, bank account debits and credits, and credit card balance and
payment status. They also provide their online share trading customers with alerts for pre-market
movements and post- market information and stock price movements based on triggers.

2.4. Challenges of Internet in Banking

ICT fosters online exchange of information dialogue. This enables faster resolution of conflict
and quicker determination of a customer need. However, Nigerian banks face a lot of challenges.
The most identified challenge is Nigeria’s poor infrastructure. Electricity supply is sporadic and
inefficient. Nigeria also has very low internet penetration with less than one internet service
provider per thousand people.

Ovia, J. (2001) highlighted the following as the identifiable challenges facing Nigerian banks in
the effective implementation of ICT.

I. Low internet connectivity

Though there is a growing dependence on internet technology, there has been low supply in
terms of connection speed. However, the introduction of wireless system has improved the
efficiency rate.

II. Low Tele-density

Nigeria has one of the lowest tele-densities in the world. Tele-density refers to the number of
landline telephones in use per 100 individuals living within an area. A tele density greater than
100 means there are more telephones than people. It is however practically impossible to grow
and expand the Nigerian financial market without adequate telecommunication infrastructure.

III. Security

Access to bank servers by unauthorized individuals poses a great threat to the utilization of ICT
in the Nigeria’s banking industry. Fraud and counterfeit money are challenge confronting ICT-
enhanced banking. It is not enough to acquire sophisticated ICT equipment but exposure to
information-technology related failure should be minimal.

11
2.5. Service quality and Customer Satisfaction
Quality in a service organization is a measure of the extent to which the service delivered meets
the customer's expectations. The nature of most services is such that the customer is present in
the delivery process. This means that the perception of quality is influenced not only by the
"service outcome" but also by the "service process".

The "perceived quality" lies along a continuum. "Unacceptable quality" lies at one end of this
continuum, while "ideal quality" lies at the other end. The points, in between represent different
gradations of quality (Ghobadian et al, 1994).

2.6. Customer Satisfaction

Turunen (2011) explained the customer satisfaction is the customer’s evaluation of the service
and product that provide by firms and banks when this service and product match with the
customer’s expectation. However, the customer perceptions are the point for actual service
experience, and customer’s expectation uses to find the performance of which service are
compared, customer gap is the difference between customer expectation and perceives, also, this
difference led the customer to be dissatisfaction. The firms must obligate to take a focus on what
satisfaction by customers because it creates a strong relationship between firms and customers.

According to Ozatac et al. (2016) the service quality is the customer’s expectations for the
commodity and service as achieved to the customer, also delivering quality service it intends that
the same with customer expectations, The satisfaction and loyalty relationship is determined by
customers, company or banks, and competitors, and the relationship includes the customer
buying habits, perception, expectations, sources of information, positive word of mouth, service
quality, satisfaction and loyalty. However, the customer loyalty leads by customer satisfaction
and customer’s loyalty produces the profitability for banks and all things related to each other.

Caruana (2002) describes the service quality is the consequence by customers for the comparison
process about what they consider banks service should be, and the expectation how the bank’s
performance for that service.

Nimako et al. (2013) the banks get the customers to satisfy by meeting their requirement for their
daily business or transactions, also banks provide internet banking as one of the services for

12
customers for getting their loyalty and satisfaction, and the customers use the internet banking
maybe they are not fully satisfied because of those services not met their requirement in this
situation the banks must take a focus to better the quality if that services and solve that point who
customers dissatisfy with it. According to Anderson et al. (1994) the Customer satisfaction is the
vision by management as the evaluation of the product and service based on the percentage of
purchasing experiences and consumption for that service during a specified period.

According to Uddin and Akhter (2012) discussed the service quality and fair service are
responsible and they have a straight influence on customer satisfaction, based on Elmayar (2011)
customer satisfaction has a strong relationship with service quality, and in other hand.
Santhiyavalli (2011) said service quality is used as one of the instruments for competitors to
getting their competitive advantage by recommending the customers that providing product and
service by banks are not just satisfying enough but also they want a better quality of the bank's
product.

Ticharwa (2017) mentioned when customer spend the cost for a service there will get the interest
if the interests more than the cost as well as customers will be a satisfying. Ozatac et al. (2016)
explained in their article and evaluate the determinations of customer satisfaction and impact of
service quality the case study from Turkish Republic of North Cyprus, also they distribute 207
questionnaire forms to customers those clients in different banks, authors use SERVQUAL
model and determined 10 dimensions of service quality.

Nimako et al. (2013) discussed and examine the internet banking with customer satisfaction in
the banking sector in Ghana, authors use a questionnaire survey to collect a primary data from
customers and they distributed 200 to responders, and the responders’ users in two banks such
as Merchant Bank and Ghana Commercial Bank, also according to the result as the customers
dissatisfy with those two banks due to limited speed to response customers’ request, customers
have problems with fee and charge by banks and less satisfying with quickness of website during
using internet banking.

Shrimali (2015) studied about internet banking on customer satisfaction and the case study in the
banking industry in Udaipur, India. based on this articles there are five dimensions of customer
satisfaction and they are responsiveness, efficiency, reliability, security and site aesthetics also

13
the authors use a questionnaire form to collect a primary data and distributed to52 responders,
however, according to the results after analyzed shown as there is a positive relationship between
internet banking and dimensions of customer satisfaction.

2.6.1. Customer Loyalty

Irfan et al. (2016) mentioned customer loyalty can be felt clearly when a customer uses a product
and service by a specific firm for a long period. And the banks should take care to find new
customers and keep the present. Ticharwa (2017) discussed there are other definitions such as
customer loyaltyis the obligation created by the customer to repurchase that goods and
services, and customer loyalty is one of the significant factors that affect banks important plan in
the long run period, the banks can make a consideration of the customer loyalty by making the
focus on buying product and service and series of purchasing by customer, according to Adams
(2016) in the competitions background the focus on developing customer loyalty this means
getting your customer’s relishing.

Mosahab et al. (2010) Customer satisfaction has an intermediary position of service quality on
customer loyalty, and this refers to a straight connection between customer loyalty and
satisfaction.

Based on Zacharias et al. (2009) customer satisfaction and loyalty are almost related to each
other but satisfaction have come former of loyalty because the customer has a strongly satisfy
until they will be loyalty. There are some studies such as Anand and Selvaraj (2013) in India
they propose a strong correlation between all service’s quality and customer satisfaction and
customer loyalty.

According to Dubey and Srivastava (2016) determined two concepts of customer loyalty, first
behavior, the behavior is when the customer reaction to repurchase a product or service in
specific bank, in another hand it is the customer’s real behavior, and behavior not belonged to
state of mind but is about person's transactions, because of financial value can measure behavior
loyalty. Second, the attitude related to customers’ ideas that customers cannot purchase a product
and service from different firms, attitudinal loyalty is when customers declare other they have a
positive feeling about the brand of that firm. And customer loyalty drives by customer retentions.
Lymperopoulos et al. (2006) discussed service quality is one of the basic components for

14
marketing service, and creating a strong long-term relationship between bank and customer is
necessary for today, because of a huge competition in market, providing better quality of service
led to provide competitive advantage for the business, any firm can be different itself by
affording huge quality of service.

2.6.2. Trust
Yu et al. (2015) defined trust as the desire consider on another individual because of belief,
expectancy, feeling, perception, that another party acting the role of interest to trust party,
another definition for trust in internet banking is desire by customers to doing their transactions
via the bank’s website because of customer has faith, perception to the bank’s website as a
trusted party to Trust has an intermediary role between a buyer and seller. In economic opinion,
trust is a technique to decrease transaction cost and reduce the customer expectation of risk.
Chiou and Shen (2012) mentioned there is an uncertain in the electronic environment because of
this reason trust is more relevant in an electronic transaction than that transaction without
electronic, in internet banking service must consider to trust because it is an influence in
determining risk and uncertainty.

Roy and Shekar (2010) were study the essential dimension of trustworthiness in financial
service. And they found out in their study the trustworthiness depends on three dimensions first
competence include the ability and experience, second is Openness include shared value and
connection, and third is benevolence such as integrity and orientation. Furthermore, Alalwan et
al. (2015) said because of human not attendance for every transaction in internet banking,
customers have some sensitive for this so thee customers should focus on the trust of that bank
when they want to be their customers, and trust is one of the important determinations to
customers' projects to adopt internet banking.

Illustrated Iberahim et al. (2016) trust is one of the major factors has influenced adopting internet
banking services. For Agarwal et al. (2009) trust is important to understanding behavior by
customers that relevant to internet banking transactions, therefore trust one of the significant
examine to successful internet banking and it is just not related to short-term period also
relevant with long-term period to realizing with e-commerce, the internet banking was provided
by banks to customers has the highest influence to satisfaction with service and customer
satisfaction followed with ease of use and comfort. While Bhat et al. (2018) said customer trust

15
has influence on customer loyalty, also the higher of customer loyalty is the higher customer
trust. However, service quality has a positive significant relationship with trust. And trust has a
positive significant relationship with customer loyalty.

2.6.3. Risk
Nevertheless, according to Wu et al. (2014) are classified the shortage of understanding to
internet banking and risk, however, unreachable to information technology and resource are the
major factors on Singapore bank customer to preventing for using internet banking. Based on
Anesti (2004) summarized risks in internet banking are competition raise, the risk of technology
becoming obsolete, financial electronic portal, Security and Trust issues, use and learn new
technologies, and Website updates. However, Subsorn and Limwiriyakul (2015) described there
are several factors those affecting and can reduce current and future users of internet banking
customers such as risk, confidentiality scared and threat.

According to Pejović (2016) explained the type of risks and they provide in business via internet
security have to be one of the major principles that led a banks’ operation and in real time those
are many institutions, systems, mechanisms and firms that working to protect the data to prevent
bank’s system against hackers and fraud, and none of them cannot warranties to protect the full
systems. Furthermore, the most important categories of risk on internet banking operations that
including electronic money are legal, the risk of reputation and operational risk also there are
several problems for risk such as a borderline case and for operational risk and reputation risk
there are a security breach and unauthorized access to customer information. Operational risk
happened because of the deficit in integrity and reliability, also due to lack of security and the
banks going to be the point of internal and external hackers and the operational risk increased
due to using internet banking badly by customers, however, except the operational risk there are
several risks that face to banks business such as reputation risk.

However, risk of reputation is a bad loss occur as a result of bad publicity on banks reputation
and has the impact to decrease the bank’s earnings and reputation risk may increase because of
the systems and products are not same with the expectation, and this type of risk happens
because of error, fraud, external and internal hackers, this type of risk just not related with the
reputation of the banks also has the effect on all system with safety of connection.

16
Moreover, legal risk is one of the risks has the impact on banks performance and this risk
appeared because of the result of works not assent with the law, regulation and rules, in internet
banking service legal risk carries protect of privacy and disclosure of customers’ personal
information and data.

2.6.4. Security

One of the factors customers will take care seriously is security, due to the security of customers’
personal privacy and information is so important for any customers to do business with any
banks, according to Agarwal et al. (2009) determined that customers expectation for product and
service provided by banks regarding security, precision, doing transaction fastly, using system
easily, users' participation and satisfaction are the most significant concept of quality of service
that perceived of internet banking. Based on Marakarkandy (2017) Security and privacy with
another five factors such as a data on internet banking, recognized enjoyment, quality of service,
recognized usefulness, learned the ease of use and all these factors has the impact on TAM
model. According to Jo and Mo (2018) regarding all benefits and availability of all service on
internet banking also there is some effects that face to internet banking adoption and these
challenges include expectation risk in security (privacy) risk and cyber fraud (cybercrime).

Gomachab and Maseke (2018) on their article they determined these factors of mobile banking
that affecting on customers’ satisfaction also those factors are trust, security, ease of use, cost of
the transaction, convenience and responsiveness. Determine of the level of satisfied comes after
the process of decision by customer.

Hoehle et al. (2012) found that customer expectation for buying a product and service of a banks
related to many factors and security one of them, security can be the reason behind the
customer's decision, because security is one of the major factor influencing customers
expectation of using internet banking system, also in a situation the individuals feel the
electronic system via bank is secure and safe they will be a convenience and satisfied to use
internet banking by the secure banks. Zhou (2012) explained a providing internet banking has
been huge convenience and relax able to customers, also using mobile banking within internet
banking service has the impact to be uncertain and doubt due to the network server that will be
the target to hack by hacker and many viruses such as Trojan horse and these problems has a

17
negative effect on customer’s decision and this determinants increase the customers’ concern
about the security of transactions and decrease a trust for mobile banking.

2.6.5. Assurance

Based on Turunen (2011) assurance is a relationship between bank’s employee and customers
that employee can convert the assurance to trust and confidence after providing to public,
Assurance related with courtesy by employee to customers and knowledge. The dimensions of
assurance include respect of a customer, make the effectiveness connection with customers, the
general attitude that provide to serve customers, the effectiveness of service performance. Adams
et al. (2016) studied that the service quality has the impact on product and service were perform
by banks, also the service’s ability to increase the demand but with the same price of product
based on those perceptions by customers, however, they examine the nine dimensions of quality
service such as assurance, reliability, reputation, competitive, accessibility, competence, clout,
awareness and collaboration. Eight of those dimensions of service quality have a significant and
strong relationship with perceiving of customer for service quality except the only clout.

According to Raza et al. (2015) the assurance dimensions related with available information and
courtesy by employees to customers also protecting customer’s information and create a
confidence. However, the dimensions of assurance are the reliable answer to customers’
requirement and faithful services. Continuously shield the protection of account also maintaining
of records error. Javed et al. (2018) considers that used electronic SERVQUAL and used 250
questionnaires were distributed to their study and examine seven dimension of service quality
such as reliability, responsiveness, privacy, efficiency, fulfilment, assurance and empathy, also
according to their information by responder they accept all seven hypothesis and based on the
result there is a difference in internet banking services in local and foreign banks in Pakistan.

According to Parasurman et al. (1988) developed and grew the SERVQUAL model and in their
study they were determined five dimensions such as reliability, responsiveness, tangibles,
empathy and assurance, the three respectively in beginning were original dimensions and the last
two dimensions means empathy and assurance includes seven original dimensions and they are
credibility, security, competence, courtesy, understanding customers and access, however the
SERVQUAL model have five dimensions.

18
 2.6.6. Reliability

According to Turunen (2011) the reliability for the product and service were provided by banks,
the meaning of reliability is of service was provide by banks and delivered at a specific time with
full authoritative and perfectly, and another important thing is delivering the service without
error and fraud to customers. Iberahim et al. (2016) noted that reliability is how to work with that
problem related with bank’s service that faced to customers, also delivering the product and
service on time without error until get to customer’s hand and ATM service has related to
reliability and it means delivering service and product to customer with high quality and a good
performance and can solve any problem in any time to customer will be fully satisfied.

There are two significant factor has the role in internet banking services such as consistency and
dependability, consistency is the agreement between potion and it means that the quality of
service and product is the same and doing things with the same standard and with same way to
achieving, also dependability is warranty of refer to perform service as expected. Also based on
George and Kumar (2014) on their research they found that one of the technical instruments is
reliability that correctly and successfully works for website and certainly of service provided.

Salihu and Metin (2017) considered that assurance and reliability are the internet banking service
elements, the electronic banking service have to be designed for trust to be the reliable and
trusted system, also reliability consider one of the service quality dimension and lot of researcher
used in their studies. Asad et al. (2016) examined that the reliability one of the significant factor
dimension of service quality in internet banking also considering reliability is the basic for
service quality

2.6.7. Customer Expectation

Customer expectation means those perceptions by customers to the product and service before
delivered, Turunen (2011) studied the variation between customer perception and expectation in
results will be a collapse in delivering service and they should recognize the possible differences
between perception and expectation in deliver service to customers.

Yoo and Donthu (2001) explained in their study that use seven dimension of electronic service
quality to measure customer perception in financial electronic business such as trust, speed to

19
delivery, reliability, ease to use, communication, website and functionality. According to
Bankole et al. (2017) determined such as expectancy of performance in (UTAUT), interest
expectancy in (TAM) and relative advantage in innovation diffusion theory (IDT) all of them
have been accepted it is a factors has the impact to use mobile banking service. However, effort
expectation acting as a representative several concepts such as perception to ease for use, ease to
use and complexity, also there are efforts expectation is the perception to using a technology in
banks daily transactions,

Salihu and Metin (2017) described the relationship between direction and size of disconfirmation
means that the customer satisfaction is the distinction after using and after buying of service and
product performance evaluation compared to the expected purchase before, therefore, delivery
the product and service on time also to be ability for complete transaction correctly the bank
should take carry of answering emails quickly and accessing to the data and information in
customers will expect. However, there are several factors those affecting on internet banking
service including the absolute process of the transaction, a validity of links available in portals,
quickly loads in internet banking portal, provide for the first time a transaction correctly and if
any problems happened there should be a guide to solving them.

Yu et al. (2015) mentioned a trust has the intermediary role when trustworthiness affecting on
customers’ behavior through electronic information of product, also in a situation when
customers expect the internet banking have been trustworthy for example related with expected
behavior of knowledge and competence. According to Turunen (2011) to service the external
customer to by banks’ consumer as well as possible it is not sufficient only on selling product
and service, to warranty the external customer to receive the service and product as they ordered
have to be the entire procedure is fully integrity, However, servicing the internal customers are
part of the whole process, when bank is servicing to internal customers in orderly the customers
will receive and get those product and service as they meet with their expectation and perception
at the end of process, the effectiveness of serve external customer has been related to
effectiveness to serve of internal customers.

20
Ozatac et al. (2016) explained the service quality is the evaluation of customers’ expectations
that has loyalty for firms and how good the level of service is delivered, delivering service
quality mean that complying and obligation on a logical basis with customer expectation.

2.7. Empirical Literature Review

Mitra and Chaya (1996) found that higher IT investments were associated with lower average
production costs, lower average total costs, and higher average overhead costs. They also found
that larger companies spent more on IT as a percentage of their revenues than smaller companies.
However, they did not find any evidence IT investment reduced labor costs in organizations.

Aki (2002) analyzed the structural change in Finnish banking sector from the period 1993 to
2002 which showed that 42 per cent of households have internet connection with banks and 90
per cent have mobile banking services. The author concluded that main goals of management of
technology were to improve customer satisfaction, reduce cost and develop new methods to
collect and analyze the customer information.

Arora (2003) made an attempt to prove that technology had a definitive role in facilitating
transactions in the banking sector; and the impact of technology had resulted into the
introduction of new products and services by various banks in India. The author discussed
various initiatives taken by the banks to manage transformation and these initiatives had brought
customers the convenience of anywhere, anytime banking. The author concluded that technology
was a facilitator for advancement in the core business of banking and not an end in itself.

Jain and Hundal (2006) described the importance of mobile banking and barriers in the adoption
of mobile banking. The paper examined the forces that can act as barriers in mobile banking
service adoption. The objective of the study was to find the reasons why the people had not fully
accepted the technology though it provided much advantage to the banking customers as
compared to previous technologies. The paper attempted to identify the various barriers, viz.

Access problems, dissatisfaction and inability of service providers in the adoption of mobile
banking services. The results of the study indicated that consumers got disheartened by the
complicated function while accessing the mobile banking services which lead to rise in their
dissatisfaction level, as no proper guidance was provided to them. The researchers suggested that
service providers should be aware of the problems of their customers. The findings of the study

21
gave a brief outlook for the practical implication for managers and policy-makers who have to
make strategies and decisions in order to cater the unexplored service market.

Boateng and Molla (2006) indicated that the operational constraints of internet banking is
associated with the customer location, the need to maintain customer satisfaction and the
capabilities of the Bank's main software to act as an influential factors in motivating the decision
to enter electronic banking services and consequently influencing the usage experience and thus
affecting the level of satisfaction.

Agboola (2001) studied the impact of computer automation on banking services in Lagos and
concluded that electronic banking has tremendously improved the services of the banks to their
customers. As a follow up, Agboola evaluated the response of Nigeria banks to the adoption of
ICT. He evaluated the nature and degree of adoption of innovative technologies, the degree of
utilization of the identified technologies and the impact of the adoption of IT devices on banks
operations using both structural analyses and the impact analysis model. He concluded that ICTs
impacted positively on all the criteria that formed the basis of evaluation namely; competitive
strength, market segmentation, improved revenue, proper forecasting and modernization
for global impact, and time saving, error rate reduction, management decisions and speed of
transaction for local impact.

2.8. Conceptual Framework

Customer Satisfaction
 Customer expectation
Internet  Customer Loyalty
Banking  Reliability
 Assurance
 Risk
 Trust
 Security

Figure 1Conceptual framework of the study

The figure above represent the independent variable has the effect on the dependent variable.
Also in the bellow there are definitions of the variables:

22
Internet Banking: According to Boyaciogluet al.(2010) internet banking has been grown more
prevail, most of financial institutions are offer internet banking to reduce that cost acquired on
banks such as decrease number of employee in the banks, fast and shorten in process, improve of
business transactions and provide better service in all views.

Customer Satisfaction: According to Iberahimetal. (2016) in the marketing business, customer

satisfaction explained as a measurement to banks and firms that provide product and service to
meet or agree with customers’ expectation. And this is one of the important items in business
because customers’ satisfaction will explain the market’s position in the future, there are several
points that influence on customers’ satisfaction such as the quality of product, quality of service,
the location of product was purchase, and the price of the service and product.

23
 CHAPTER THREE
3. RESEARCH METHODOLOGY
In this chapter the researcher explains those research methods were used in this study ,the
method also included a quantitative data has been collected from responders, also this chapter
focus on research design and, target population, sampling techniques, sampling unit, data
collection tools, data analysis and ethical consideration along with an appropriate justification.

3.1. Description of the study area

The study was conducted in commercial bank of Ethiopia bale robe district selected branches.
Bale robe district cover the south east part of country and under bale robe district 35 branches are
found.

3.2. Research Design

Sekaran and Bougie (2016) defined the research design it is a planning or schema for collecting
data, measurement, examination of data, design to find answer to your research's questions.
Considering the research strategy help the researchers to find an object of them researches.

The type of research employed in this study will be both descriptive and econometric model
which is linear multiple regression model. The reason behind for the use of descriptive design for
this study is to properly describing the state of affairs, as it exists at present CBE, Bale robe
districts.

3.3. Research approach

In this study, the researcher will use both qualitative and quantitative approaches. Under this
approach, the combination of both qualitative and quantitative approaches of doing research will
be employed for to gather meaningful data required to meet the objectives of the study as
recommended by Creswell (2009).

3.4. Source of data

Both primary and secondary sources of data were used in this research. The primary data has
been collected from the sample customers and staff of commercial banks of Ethiopia.

Secondary data sources such as documents, books reports, journals, research works related to the
topic in CBE and repots of CBE bale robe district offices was used to gather secondary data.
24
3.5. Data collection tools
The researcher was used questionnaire, interview and focus group discussion. Open ended and
close-ended questionnaire will be presented to sample respondents those are staff of CBE to
collect relevant data from. On the other hand, interview has been employed to collect data.

3.6. Sampling techniques

The sampling technique that was used for the managers, technical experts from Information
Technology departments and existing customers of CBE is Purposive Sampling Technique.
Because instead of using random sampling technique purposive sampling is better in collecting
information in such area of studies. The reason behind is to get currently existing detail
information regarding electronic banking services that are offered by Commercial Bank of
Ethiopia. Since the questionnaire were developed in English and local languages (Amharic) and
the information needed requires knowledge of previous service delivery by the bank, purposive
sampling technique was used for the selection of existing customers of the bank. Purposive
sampling can be very useful for situations where you need to reach a targeted sample quickly and
where sampling for proportionality is not the primary concern. With a purposive sample, you are
likely to get the opinions of your target population. And systematic random sampling technique
was utilized for employees of Commercial Bank of Ethiopia.

3.7. Sample Size

The target population of the study is employees and managers from different branches of
Commercial Bank of Ethiopia, technical experts from Information. Customers of Commercial
Bank of Ethiopia are selected because they were served by CBE before and after implementation
of different banking software and various technological products. however, the sample size in
this study is 200 respondent who were selected randomly and they are include a customers of the
banks were adopted internet banking service from different branches of bale robe districts and
questionnaires were distributed. These questionnaires were distributed face to face to all the
respondents.

3.8. Methods of Data analysis

Based on the objectives of the study, appropriate tools and techniques of analysis such as
descriptive analysis and econometric models were employed.

25
Demographic and socio-economic conditions of sample respondents was analyzed used for
interpretation of data and drawing conclusions. To analyze the data descriptive statistics has been
employed for data analysis.

Researcher in this study adopted a statistical method to analyze those data were collected by
using the Statistical Package for Social Science (SPSS) version 22 application, also, the reason
behind to chosen the analytical method to determine the relationship between the independent
variable (internet banking) and dependent variable (customer satisfaction), use a simple
regression analysis to determine the type of relationship it means that there is a positive or
negative relationship between this two variables, Therefore, the researcher was used the Pearson
correlation to indicate the correlation between variables.

The analysis and findings of the study was presented by using table, graph, charts and the like.

3.9. Model Specification

From the bellow equation researcher can explain the whole model by economic equation:

Y=β0+β1X1+
Where, Y: Customer Satisfaction.
X: Internet Banking.

3.10. Ethical consideration

In order to secure the consent of the research, the researcher was communicated with all
concerned bodies about the details and the aims of the study. And, the researcher had oriented
the participants in data collection and encoding that they have to participate in the research
willingly. Moreover, the researcher was ensured to the respondents not to disclose their names,
position and personal information and will apologizes all for their participation.

26
 CHAPTER FOUR
4. DATA ANALYSIS AND SUMMARY OF FINDING
This chapter includes the analysis of all the data that were collected from respondents to interpret
and used several statistical tests such as descriptive to demographic section and correlation,
regression to choose and understand the hypothesis and level of significance of variables.

4.1. Descriptive Statics

This part presented the findings and the discussion of the study. It begins by presenting the social
demographic information of the respondents. From a total of 200 respondents 191 respondents
were responded and their socio-demographic characteristics were summarized as indicated
below.

4.1.1. Gender
Table 4.1 indicate the result about Gender in the survey, the results show that majority of the
population respondents are Males with a 50.8% (n=97) and 49.2% (n=94) are Females, the
results of gender have been shown in Figure 4.1.

Table 1gender of respondents

Gender Frequency Percentage

Male 97 50.8
Female 94 49.2
Total 191 100

27
 Gender of Respondents

50.8

49.2

male female

percent

Figure 2 Gender of respondents.

4.1.2. Age
The results are gotten from Age in section one as shown in table 4.2 and figure 4.2, also the age
of majority of respondents between 24-30 years with 35.6% (n=68), after these 31-36 years is a
second highest with 27.7% (n=53), also 12.0% (n=23) related to 37-42 years as a third highest,
therefore, 10.5% (n=20) has been filled and they are above 43 years, in the last part and as the
lowest number of respondent they are under 18 years with 4.7% (n=9).

Table 2age

Age Group Frequency Percentage

Under 18 9 4.7
18 - 23 18 14.1
24 – 30 68 35.6
31 – 36 53 27.7
37 – 42 23 12.0
Above 43 20 10.5
Total 191 100

28
 Age of Respondents

<under 18
10% 5%
10% 18 - 23
12% 24 - 30
31 - 36
37 - 43
36% above 43
28%

Figure 3 Age of Respondents

4.1.3. Marital Status

The result has been shown in table 4.3 and figure 4.3 related to the marital status of respondents
who participate in our survey. The majority of our respondents are married with 62.3% (n=119)
and second highest are single with 34.0% (n=65), however, only 3.7% (n=7) responders have a
divorce status.

Table 3: Marital status

Marital Status Frequency Percent

Single 119 37.7

Married 72 62.3

Total 190 100

29
 Marital Status

single
37%
married
63%

single married

Figure 4 Marital status of respondents.

4.1.4. Monthly Income
The result shown that the majority of respondents who receive the highest income are 41.9%
(n=80) and their income between 10,000-15,000, and the second highest income 7000-9,000 who
is 27.2% (n=52), followed by 15.7% (n=30) respondents their income between 4,000 – 6,000,
and finally the lowest income respondents are between 1,000- 3,000 with 15.1% (n=29), results
have been shown in table 4.4 and figure 4.4:

Table 4: monthly income

Monthly income Frequency Percentage

1,000 – 3,000 29 15.1
4,000 – 6,000 30 15.7
7,000 – 9,000 52 27.2
10,000 – 15,000 80 41.9

30
 Monthly income

10,000-15,000 41.9

7,000-9,000 27.2

4,000-6,000 15.7

1,000-3,000 15.1

0 5 10 15 20 25 30 35 40 45

percent

Figure 5 monthly income of respondents

4.1.5. Qualification
This question related to the responders’ qualification in a survey and include 4 level as shown in
table 4.5 and figure 4.5, the majority of respondents has a Bachelor’s degree with the 66.5%
(n=127) and the second qualification of respondents who completed Master’s degree with a rate
of 16.7% (n=32) and the third highest qualification is high school with 15.7% (n=30), and finally
the lowest level goes to PhD. degree with 1.4% (n=2).

Table 5: educational qualification

Qualification Frequency Percentage

High school 30 15.7
Degree 127 66.5
Masters 32 16.7
PhD 2 1.4
Total 191 100

31
 Educational QUalification
66.5
70
60
50
40
30
15.7 16.7
20
10 1.4
0
high school degree masters PHD

percentage

Figure 6educational qualification of respondents.

4.1.6. How Long Have You Been Using Internet Banking
The question number six in our questionnaire was asked about the time of using internet banking
service who faced to respondents and they answer as followed. Under 1 year is the majority of
respondents with the rate of 37.2% (n=71) and the second highest responders are 31.9% (n=61)
goes to using internet banking between 1-3 years, and the third highest related to those
respondents who using internet banking between 4-5 years with 20.9% (n=40) and followed this
goes to those responders who using the service above 5 years with the rate of 10% (n=19). The
result shown in table 4.6 and figure 4.6:

Table 6: How long have you been using internet banking?

Years Frequency Percentage

Under 1 year 71 37.2
1-3 year 61 31.9
4-5 year 40 20.9
Above 5 year 19 10.0
Total 191 100

32
 internet banking usage

above 5 year
10% below 1 year below 1 year
4-5 year
21% 37% 1-3 year
4-5 year
1-3 year above 5 year
32%

Figure 7: How long have you been using internet banking?

4.2. Statistical Analysis of Variables

4.2.1. Internet Banking
Table 7: internet banking

Statement N Mean Std. Deviation

I understand what it means by internet 191 4.08 .940
banking
Internet banking is easy to use 191 4.03 .760
Internet banking is safe for business
191 3.69 .903
transaction
Internet banking is cheaper way to conduct
191 3.99 .855
banking
Internet banking helps customer to complete
191 4.01 .926
transaction quickly
Internet banking can do everything for me
191 3.53 1.020
an employee does

33
 Internet banking makes transferring money
191 4.05 .869
between accounts easier
I get internet banking service 24 hour a day 191
3.86 1.111
and 7 days a week
I do most of my banking transaction with 191
3.26 1.037
internet banking
I think using internet banking put my 191
3.26 1.331
privacy at risk
I trust the devices used in internet banking 191 3.62 .976
I expect to continue to use internet banking 191
3.80 .897
in the future
Controlling my bank account has improved 191
3.61 .977
after using internet banking
Using internet banking avoids contact with 191
3.54 .993
bank employees
Becoming skillful using internet banking is 191
3.74 1.042
easy
When compared to the cost, do you think 191
3.43 1.140
the quality of internet banking service that
you received is appropriate

The above table 4.7 has shown the mean and standard deviation of respondents in internet
banking section that indicate (16) questions who customers fill it, the highest std. deviation in the
independent variables related to those customers who thought internet banking the service puts
their privacy and security information at risk and threat (M=3.26, SD=1.331), respondents were
believed service of internet banking provided by banks is appropriate when compared with cost
(M=3.43, SD=1.140), followed by customers receive their service of internet banking in24 hours
and 7 days in a week (M=3.86, SD=1.111), the users thought to learn and have been skillful is
easy (M=3.74, SD=1.042), also customers doing a lot of transactions by internet banking instead
of visiting branch (M=3.26, SD=1.037), respondents believe that in employee of the bank and

34
internet banking doing same things so it means that internet banking is doing everything as
employee does (M=3.53, SD=1.020).

Internet banking let customers avoid their self to contact with banks’ employees (M=3.54,
SD=.993), controlling or monitoring the account by internet banking is better than adopt by
traditional service (M=3.61, SD=.997), customers have a trust with those device used by them-
self (M=3.62, SD=.976), customers understand of internet banking (M=4.08, SD=.940), doing
transaction is quicker after using internet banking (M=4.01, SD=.926), it is safe to doing
transaction (M=3.69, SD=.903), they think will use the service in future (M=3.80, SD=.897),
after adopting internet banking transferring money is easier than before (M=4.05, .869).

Internet banking service is a cheaper way for banking transactions (M=3.99, SD=.855) and using
internet banking easy has the lowest Std. Deviation in whole (16) questions (M=4.03, SD=.940).
However, the highest mean in all question on independent variables is (M=4.08) related to that
questions ask about understand of internet banking means and the lowest mean is (M=3.26) two
questions has a same result of mean and they are doing lot of transaction by internet banking and
they think internet banking puts there in risk.

4.3. Customer Satisfaction

Table 8: Customer satisfaction

Statement N Mean Std. Deviation

I am satisfied by with online banking
191 3.65 .933
provided by my bank
I don’t expect banks online service to have
191 3.29 1.054
an error or defect in the service.
How well do you expect the banks online
191 3.46 1.004
banking service to respond to your personal
need?
I am satisfied with the service charges of my
191 3.43 1.073
bank account
I prefer using internet banking instead of
191 3.94 1.009
visiting branch for making transaction
If there is mistake, the bank can make it right

35
 quickly and effectively 191 3.52 .972
The bank always provides the service at
191 3.57 1.002
promised time
The behavior of the banks employees, instils
191 3.66 1.093
confidence in customer
Employee of bank have knowledge to
191 3.78 1.033
customer question
Will you continue to use internet banking
191 3.39 1.079
service from this bank
Would you recommend other people to use
191 3.76 1.023
internet banking service offered by the bank
When I use internet banking hackers might
191 3.09 1.137
control my banking account
Even if not monitored, I would trust internet
191 3.24 1.130
banking to do my job right
I feel secure in providing sensitive
191 3.62 1.093
information for online transaction

The table 4.8 above shown the Mean and Std. Deviation related to the dependent variable
(Customer Satisfaction) that indicate (14) questions who fill it by 191 respondents and their
answer showed this results as follow, the highest Std. Deviation(M=3.09, SD=1.137) hacker
maybe control customer’s account during use of internet banking, followed by customers
believed without monitoring, they would trust internet banking to do my job right (M=3.24,
SD=1.130), attitude of banks’ employee has an effect on the customer confidence (M=3.66,
SD=1.093), also another question has the same result it is customers has been feeling secure and
safe when they give their private information to doing transaction in internet banking (M=3.62,
SD=1.093).

After that customers continue to use the service in the same bank (M=3.39, SD=1.079), satisfy
with fee on bank account (M=3.43, SD=1.073), customers will not expect to face error when
they use internet banking (M=3.29, SD=1.054), employee has a require knowledge to answer of

36
what customers want (M=3.78, SD=1.033), customer recommend other people to use the system
(M=3.76, SD=1.023), customer believe that using internet banking service is better than visiting
the branches (M=3.94, SD=1.009), customer expect the internet banking service respond their
personal require (M=3.46, SD=1.004).

In every situation the bank perform the service in any time as they want to do (M=3.57,
SD=1.002), before the last question there are banks that solve the problems as soon as possible
(M=3.52, SD=.972), the last one is customers satisfy with that electronic service provided by
bank (M=3.65, SD=.933). However, the highest Mean is (3.94) that is customer agree and prefer
using internet banking instead of visiting branches and the lowest Mean is (3.24) by two
questions and they provide sufficient internet and in a situation, without monitoring the service it
is doing all transaction correctly.

4.4. Correlation

Table 9: Correlations

Correlations
customer internet
satisfaction banking
Pearson Correlation
1 .557**
customer
satisfaction Sig. (2-tailed) .000
N 191 191
Pearson Correlation
.557** 1
internet
banking Sig. (2-tailed) .000
N 191 191
**. Correlation is significant at 0.01 level (2- tailed)

Pearson correlation is a statistical test used to find out the relationship between variables, the
table 5.9 above has been shown the relationship between customer satisfaction and internet
banking variables, also correlation level to significant is 0.01 (2-tailed) and based on the result
shown there is a positive and strong correlation (r=0.557) between customer satisfaction and
internet banking and significant relationship between the dependent variables (customer

37
satisfaction) and independent variables (internet banking) because of the result of significant is
less than (0.01).

4.5. Regression Analysis

Another statistical test is regression and the researcher use simple linear regression for this study,
regression use to determine the level of relationship between the independent variable (internet
banking) and the dependent variables (customer satisfaction) and another use of this test
indicates to accepting or rejecting all hypothesis in the study.

Table 10: Model Summary

Model Summary

Model R R Adjusted Std. Error of

Square R Square the Estimate
.557a .311 .307 .47585
1
a. Predictors: (Constant), internet banking

Table 11: ANOVA

ANOVAa
Sum of
Model Squares Df Mean Square F Sig.
1 Regression 19.285 1 19.285 85.167 .000b
Residual 42.796 189 .226
Total 62.081 190
a. Dependent Variable: customer satisfaction
b. Predictors: (Constant), internet banking

Table 12Coefficients

38
 Unstandardized Standardized
Coefficients Coefficients
Model B Std. Error Beta t Sig.
1 (Constant) 1.355 5.720 .000
.237
internet .557
.579 .063 9.229 .000
banking
a. Dependent Variable: customer satisfaction

According to table 4.10 the R square value is (.331) and it means that almost, 31% of customer
satisfaction (dependent) determined by the internet banking (independent), the result has been
shown of adjusted R square is (.307) so it means that after process of adjusting all variables
almost of 30% of the customer satisfaction (dependent) variable as the influence by the internet
banking (independent) variable and the value of adjust R square should be approaching the value
of R as shown in the result, the F value is (85.167).

Based on the table 5.14 of coefficients the unstandardized of constant (β 0) is 1.355 and (β 1)
is .579 and it means that if the customer satisfaction increase by 1 unit the internet banking will
increase by (.579) it shows there is a positive and direct relation and according to the significant
level as shown in the model is (0.000) it means that the model is significant due to the result is
less than (0.05) and based on this the hypothesis null must be rejected and accept the alternative
hypothesis (H1 is supported) and it means that the internet banking has a positive impact on
customer satisfaction.

Therefore, among the simple regression test researcher write the economic equation based on the
result form the coefficients table 5.11, the equation is as follow:

CS= 1.335 + 0.579 IB + e

4.6. Normality Test

Normality test is another statistical test was used to know how the variables are normality
distribute or non-normality distribute, also indicate by two test and they are Kolmogorov-
Smirnov (KM test) and Shapiro-Wilk (SW test), However, to determine that the variable is

39
normally distribute or not in both tests we have to compare with P-value (sig.), the hypothesis for
normality test as follow:

H0: the data are normally distributed.

H1: the data are not normally distributed.

Figure 8 Normality distribution of Customer satisfaction.

According to our results for rejecting or accepting the hypothesis, if the P-value is less than 0.05
it means the null hypothesis is reject and hypothesis one is accept and it means that the data are
not normally distributed, if the result greater than 0.05 we accept the null hypothesis and the data
are normally distributed. Based on table 5.15 the KM test for dependent variable (customer
satisfaction) is 0.065 and P-value >0.05 and it means the H0 is accepted and the data are
normally distributed, also KM test for independent variable (internet banking) P-value is 0.009
and it means that our result is significant and the data are not normally distributed.

Therefore, in Shapiro-Wilk test the P-value for customer satisfaction data is0.345 and it means
that the result is greater than 0.05 so the H0 is accepted and the data is normally distributed, also

40
the P-value in internet banking variable is 0.000 and it means that the result less than 0.05 and
the data are not normally distributed.

Table 13Normality test

Kolomogorov- smirnova Shapiro- wilk

Statistic Df Sig. Statistic df Sig.

Customer satisfaction .063 191 .065 .992 191 .345

Internet banking .076 191 .009 .939 191 .000

However, another way to tests of normality is Z-value, and the result should between -1.96 and
+1.96 for finding Z-value because of researcher use 5% as a significant level and we should
calculate by hand the measure of Skewness.021 divided by Standard Error .176 and it is
equal .11 and same thing for Kurtosis measure .370 divided by Standard error .350 and it is equal
1.057, and according to both results of z-value from dependent variable (customer satisfaction)
they are between -/+1.96 and it means that the data are normally distributed.

For independent variable (internet banking) we have to Skewness measure .833 divided by
standard error .176 and it is equal to 4.732, also for Kurtosis measure 5.802 divided by .350 and
the result equal 16.577.

4.7. Result hypothesis

According to the results were got from the regression analysis in coefficient table 4.12 and based
on that result it tell us the P-value or Significant result is 0.000 and it means that the P-value is
less than the 0.05 level of significant and should be reject the H0 it says the internet banking has
a negative impact on internet banking and it means there are not impact of internet banking on
customer satisfaction according to those data were got from the respondent, Also, researcher
should accept the H1 it is that the internet banking has a positive impact on customer
satisfaction.

41
 CHAPTER FIVE
5. FINDING, CONCLUSSION AND RECOMMENDATION
Chapter six which is the final chapter is the conclusion and recommendation of this study. The
chapter provides a summary and implication of the main findings of this study as presented in
chapter four. This is then followed by the findings of this study to the bank, customers and the
banking industry in general. The chapter ends with the recommendation for the various
institutions of concerns and finally area of future research.

5.1. Findings
The demographic analysis shows that more males use the internet banking services than their
female counterparts. Additionally, when it comes to age group, the modal age of users of internet
users of the banks in CBE was 24-30 year or in their youthful age. The marital status of most of
the users of internet banking activities in CBE were married whilst educationally, majority hold a
Bachelor degree from various fields of studies. In addition to the above, the most earned income
of users of internet banking activities was between birr 10,000 to 15,000. Most users of internet
banking have been using the services for between below 1 years and majority use the services in
a month.

From this research the researcher discussed that internet banking provides a better banking
experience for customers, the fact that customers can check their balance, perform transactions
without visiting any bank provides an easy and comfortable experience for them, with internet
banking customers can be assured about their online security if the bank has taken the proper
precaution and security measurement required when making transactions online.

This present study indicates the impact of internet banking on customer satisfaction. The
dependent variable is customer satisfaction and was measured by 15 different questions that were

42
selected by seven dimensions of service quality and the independent variable internet banking
were measured by 14 questions.

The researcher findings that from Pearson correlation and explore there are a positive and strong
correlation between dependent and independent variable and statistically significant, however,
finding from the regression estimation the internet banking has a positive impact on customer
satisfaction as researcher assume from the questions at the beginning of the thesis and it means
that if the customer satisfaction increase by 1 unit the internet banking will increase by 0.579 and
according to P-value (significant level) the model statistically significant due to the result is less
than 0.05.

As far as the R2 result suggests that, 31% of customer satisfaction (dependent) determined by the
internet banking (independent), the result has been shown of adjusted R square is (.307) so it
means that after process of adjusting all variables almost of 30% of the customer satisfaction
(dependent) variable as the influence by the internet banking.

Based on the coefficients of unstandardized of constant (β 0) is1.355 and (β 1) is .579, and it

means that if the customer satisfaction increase by 1 unit the internet banking will increase by
(.579) it shows there is a positive and direct relation and according to the significant level as
shown in the model is (0.000) it means that the model is significant due to the result is less than
(0.05) and based on this the hypothesis null must be rejected and accept the alternative
hypothesis (H1 is supported) and it means that the internet banking has a positive impact on
customer satisfaction.

Hence, mathematically the researcher equates the following simple linear regression equation
based on the regression result as follows:

CS= 1.335 + 0.579 IB + e

5.2. Conclusion
Customer satisfaction has long been found as playing an essential role for success and survival in
today’s competitive environment. Overall, results show that highly educated persons who are

43
employees, businessmen and belong to higher income groups and younger are major users of
internet banking.

The findings of the study reveal that customers are satisfied with their respective bank for
internet banking facilities which save their time and cost and enable them to know their account
balances and remit funds from one place to another anywhere and any time

Based on both the descriptive statistics and inferential statics, the results are statistically
significant and it is meritorious, however, according to the correlation analysis indicate that there
a significant positive correlation between the dependent variables customer satisfaction
(customer expectation, customer loyalty, Security, Reliability, Assurance, risk, trust) and the
independent variables internet banking.

A regression analysis indicates that internet banking has a positive and significant effect on
customer satisfaction, dependent variable's data is normally distributed and the independent
variable’s data is not normally distributed.

5.3. Recommendation
The government of Ethiopia should make a plan to adopt internet banking service and provide it
by governmental banks and as well as private banks due to they can use for paying salary and
directly transfer their amount to employee’s account and all other payment who pay to the
government employee and all other pension people.

CBE should have to conduct a mass campaign thorough the country in order to create awareness
about internet banking service. Even if by giving such incentives to the customer, the bank has to
promote this service in a highly and effective manner.

There is the need to educate majority of the banking population on internet banking. This was
because most of the customers administered with the questionnaires rejected or refused to answer
the questionnaire because they did not know of the services nor had minimal education of
internet banking services

44
Another things that the bank should have to consider is, they should decrease the commissions
and fees charge on customers’ accounts and if the banks decrease cost it will help that huge
numbers of customers try to create an account and puts them funds in that banks.

The Management and board of the banks should consider and work to increase the efficiency of
their employee and use new program and system to develop banks daily work, also send
employees to training inside or outside in country to develop their skills and experience and
follow newest features of modern technology.

This research gives an opportunity to future researchers who want to work in this area because
there is significant information on literature which another researcher can use it as source,
suggestion to use all dimensions of service quality and they can follow all internet banking items
as variables to get the correlation between them, in a case they adopt a primary data they can use
a large sample size of population. Also made a compare between service of commercial banks
and other private banks.

45
 REFERRENCE
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Aman Assefa (2009). Information and Communication Technology in Ethiopia Challenges

and Prospects from an A2K Perspective. Unpublished Master’s Thesis,
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Bhaskar Reddy M. and Tewdros Sisay (2011), E-Business: Application of software and
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Boateng, R,and Molla, A.(2006). Developing E-banking Capabilities in a Ghanaian Bank:

Preliminary Lessons, Journal of Internet Banking and Commerce, Vol.11,
No.2.

Dominique Baron (2010). The Impact of Telecommunications Services on Doing Business

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(2011),"InformationTechnologyforManagement:TransformingOrganizations

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 intheDigitalEconomy",3rd edit., John Wiley & Sons,Inc., pp.10-15.ISBN
978-0-471-78712-9.

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‟Savings and Credit Association with special emphasis to adjustments (NBE
WSACA) ‟

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November 2011ISSN (Online): 1694-0814 www.IJCSI.org194.

Jensen, M. (1996a). Bridging the Gaps in Internet Development in Africa, Mansell et al.,
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Mitra, S., & Chaya, A. K. (1996). Analyzing Cost-Effectiveness of Organizations: The

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Osabuohien, (2008). “ICT And Nigerian Banks Reforms: Analysis of Anticipated impacts In
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CA: SAGE Publications

47
 Madda Walabu University
Department of Marketing Management

Marketing Management MA Graduate Program

Survey Questionnaire to be filled by user of internet Banking users of CBE

Dear respondents,

This survey questionnaire aims to study “the impact of internet banking on service delivery
and customer satisfaction” in CBE Bale robe district. It is purely conducted for academic
purpose. The responses to this questionnaire will be kept strictly confidential and is subject to
ethical rules of research at Madda Walabu University. Therefore, I kindly request you to fill the
questionnaire honestly and neatly assuring that the data will be used solely for the intended
academic purpose only. Your response is very crucial together data for this study.

Please read the instructions carefully and answer all questions and if you have any inquiry call
the researcher, Chaltu Kedir, at Mobile NO.+2519-16013894 for more explanation.

Yours sincerely!

Chaltu Kedir

48
Part I: General demographic Information

Please circle the alternative that most closely represents your personal information:
1. Gender: 1) Male 2) Female
2. Age: 1) below 18 2) 18-23 3) 24 – 303) 31-36 4) 37-43 5) >43
3. Education level 1) high school 2) 1st Degree 3) Masters 4) PhD
4. Marital status?
1) Single 2) married 3) divorced
5. How long have you using internet banking in CBE? (Work experience in years)
1) Below 1 years 2) 1years – 3years 3) 3 – 5 years 4) Above 5 years
6. Monthly income
1) 1,000-3,000 2) 4,000-6,000 3) 7,000-9,000 4) 10,000 – 15,000

49
Part II: Internet banking

Statement N Mean Std. Deviation

I understand what it means by internet 191 4.08 .940
banking
Internet banking is easy to use 191 4.03 .760
Internet banking is safe for business
191 3.69 .903
transaction
Internet banking is cheaper way to conduct
191 3.99 .855
banking
Internet banking helps customer to complete
191 4.01 .926
transaction quickly
Internet banking can do everything for me
191 3.53 1.020
an employee does
Internet banking makes transferring money
191 4.05 .869
between accounts easier
I get internet banking service 24 hour a day 191
3.86 1.111
and 7 days a week
I do most of my banking transaction with 191
3.26 1.037
internet banking

50
I think using internet banking put my 191
3.26 1.331
privacy at risk
I trust the devices used in internet banking 191 3.62 .976
I expect to continue to use internet banking 191
3.80 .897
in the future
Controlling my bank account has improved 191
3.61 .977
after using internet banking
Using internet banking avoids contact with 191
3.54 .993
bank employees
Becoming skillful using internet banking is 191
3.74 1.042
easy
When compared to the cost, do you think 191
3.43 1.140
the quality of internet banking service that
you received is appropriate

Part III: Customer Satisfaction

Statement N Mean Std. Deviation

I am satisfied by with online banking
191 3.65 .933
provided by my bank
I don’t expect banks online service to have
191 3.29 1.054
an error or defect in the service.
How well do you expect the banks online
191 3.46 1.004
banking service to respond to your personal
need?
I am satisfied with the service charges of my
191 3.43 1.073
bank account
I prefer using internet banking instead of
191 3.94 1.009
visiting branch for making transaction
If there is mistake, the bank can make it right
191 3.52 .972
quickly and effectively

51
The bank always provides the service at
191 3.57 1.002
promised time
The behavior of the banks employees, instils
191 3.66 1.093
confidence in customer
Employee of bank have knowledge to
191 3.78 1.033
customer question
Will you continue to use internet banking
191 3.39 1.079
service from this bank
Would you recommend other people to use
191 3.76 1.023
internet banking service offered by the bank
When I use internet banking hackers might
191 3.09 1.137
control my banking account
Even if not monitored, I would trust internet
191 3.24 1.130
banking to do my job right
I feel secure in providing sensitive
191 3.62 1.093
information for online transaction

Thank you for completing our survey and your answers are highly appreciated!!

52