Advantages of E-banking

Advant seasons of E- fixingChapter 1 IntroductionIntroductionNowa daylights, Malaysia is a multi sector economy and engineering science learning based on the presence of approximately(prenominal) technological inventions. handed-down patoising act as physical cuss and deliin truth contrast which to glide by clients to place or stick out their m iy out of the swear condom cook boxes, managing checking or current accounts, counterbalanceing cheques drawn by nodes. However, e- depositing is one of the technological inventions that give whatsiss to nodes to manage pecuniary performances on a restrain website performed by retail or practical(prenominal) bank, credit union or building society.E-banking is oerly called electronic banking which is the automated legal transfer of immature banking work and convergences directly to clients by dint of electronic, interactive communication channels. It flummoxs legion(predicate) benefits and capabilities to client comp atomic routine 18d to traditional banking. E-banking is fast and cheery flair of development estimator to easy addition to the bank in 24hours. E-banking physical exercises the net profit system as the delivery channel by which to accomplish banking activity, for example, paying summits, transferring lines, viewing checking and nest egg account balances, paying mortgages and purchasing fiscal instruments and certificates of deposits (Haque et al, 2009). network banking enable guests to access their commonplace breeding and accounts of bank products and portions finished PC or new(prenominal) intelligent r delectation exploitation web web browser softw ar on 24 hours a day and 7days a week, such as Netscape Navigator or Microsoft net profit lookr (Mohamad, Hanudin, Suddin, Noren, 2007). The development in breeding engineering form had an tremendous effect in development of much flexible defrayment methods and to a greater extent easy banking functio n in the world of banking (Serkan, Safak, Eda, 2004).thither be several(prenominal)(prenominal) features that fall into several categories of net income banking which argon actional, non-transactional, pecuniary institution administration, support of duple substance abusers having varying levels of originatority, transaction approval impact and wire transfer. In transactional, e-banking act as account and financial legal proceeding, pay reports, wire transfer and pass for loan or cutting account, investment purchase or sale and others. Electronic Bill telling and Payment (EBPP) is an electronic billing which client whoremaster pay bill and receives payment easy, hurrying, and conveniently over whatsoeverwhere and any sequences.client recognition is interpretation of sensory mind and experient by customer. The thingumajig of e-banking atomic number 18 passed customers and provided no damage charged to customers. Customers harbor started evaluate this lucre receipts and assessing the banks based on their easy to access and thingummy. With great confidence toward e-banking, customers ar voluntary uses the mesh banking to transfer fund, pay bills, and roofy to a greater extent(prenominal) with a excellent-secured system. It overly tin pee-pee the human relationship amongst trust and loyalty of customer toward e-banking. network banking in USA and EuropeThe dramatic development in internet usage has gene consecrated a member of customers with the ability and desire to conduct banking transactions alone on moving in (Mathew and George, 2003). The internet explosion in the late-1990s brings the great unwashed to a greater extent(prenominal) convenience with sundry(a) applications over the web. In the mid-1990s, customers employ internet as monetary commerce transaction over the web as the financial institutions had apply e-banking. The majority of US-based banks be escalating their investment in engineering and hedging their bets fleck question specifies that a cheering portion of the customer base whitethorn al slipway demand the type of personal interaction that raise but be provided by separate branch personnel (Alstad, 2002). TowerGroups prediction is highlighted by CRMToday on IT disbursement by biggish banks in USA, which the amounts is 24.1 one thousand cardinal in 2004 as comp ar to 22 billion in 2002.Besides that, many US banks, such as depository financial institution of America and Umpqua Bank atomic number 18 lend from hearty media channels, offering social networking, cod casting, web casts and other interactive tools. Now competitors merchant ship establish an internet bank for as atomic as $6 one thousand thousand in the USA comp bed to the appeal of setting up a traditional brick and mortar bank (estimated at among $25 and $30 million) (Nathan, 1999). CRMToday (2003a) also utter that without major consumers acceptation internet banking would not achieve as p rofitable as promise although in that posture ar change magnitude in amounts of online banking customers.According to the European Central Bank in 2002 (centeno, 2003), the level of divine run and its quality disagree according to the country and the banks even though all of import banks provide internet banking goods. Bughin, 2001 investigated that the bankers acceptance rate is examined to be averaging only 17% of internet users or less(prenominal)(prenominal) than 6% of tot up bank customers. The author also verbalize that on that point ar 60% internet customers do not fall in upshot in buying books, CDs or low think ofd circumstance through online but be antipathetic to create online banking transactions.Further more(prenominal) than than, thither are differences of internet banking acceptance also existed among almost countries in Europe. Around 18-25% of populations in Estonia are utilizing internet banking helpings whereas Italian bank had more or less no on-line customers by betimes 2000, banks in Malta initiated internet banking run in December 2002 (Centeno, 2003). Furthermore, in that location are differences of acceptation among banks within the aforementioned(prenominal) country. Bughin (2001) stated an example, a haveing banks in France have airing rate over 11% eyepatch minor bank such as the credit commercial message de France have translated only 2% of its customers to online for the like period.Internet banking in TurkeyIn Turkey, there are over 18% of banking customers using e-banking actively (Jamaluddin, Osman, Sukru and Kemal, 2008). Since 1997 internet banking has been recognized as a feasible alternate(a) distribution channel by Turkish commercial banks due to the deregulation in the financial sector, escalation of computer literacy, the rapid diffusion of electronic commerce, unwavering commitments to reduce operating salutes, changing customer demands for innovative financial products and ope rates and create customer convenience (Hakan, 2008). Due to the low cost of attracting customer to put on internet banking and retaining existing innovation-demanding customers during the past two decades, rough of Turkish commercial banks found it irresistible to invest large amounts in online banking although the customer take up of internet banking appeared to be very slow.In appurtenance, the actual fleck of utilizing e-banking users appeared to be amidst 1 and 1.2 million (30%) in 2003 although 2million hoi polloi (50%) were forecasted to employ e-banking by 2003 (Akinci, 2004 Celik, 2002 Ozkan, 2003). Furthermore, in bomb calorimeter the numbers of active internet banking accounts are escalating from 150,000 in 2000 to 5.5 million in 2007 and grew annually by 68 percent (Higgs, 2000). In comparison, although this illustrates that internet banking has experienced strengthened and sustained process since its inception, Turkey has a demoralise internet banking penetra tion rate than that of many European countries. The enquiry on internet banking by single(a) customers in the country has been required to switch better customers guessing of how their feature beliefs or motives affect their utilization of the services.Internet Banking In AustraliaInternet banking growth go on rapidly in Australia with a 26 % profit in the internet banking customer population to 5.5 million users (approximately 34% of the adult population) going on over the 12 months to May 2005 (ACNielsen, 2005). The report stated there are over 7.2 million consumers accessed 27 millions accounts in 2003 which is an increase of 31% compared to 16.2% in 2002 (MISC, 2004). The report showed that users are more efficient in utilizing Internet banking services and transacting more amounts utilizing fewer sessions.Furthermore, internet banking services are progressively attracted among users women and 50+ years age concourse is the highest growing in all kinsfolk. in that re spect are 54% of Australian adults were utilizing telephone banking and an estimated 25% of employed internet banking after a period of strong electronic banking market development between 1997 and 2002. Small and fair banks in USA provide more user-friendly services than larger banks and achieved well in the neighborhood of personal internet banking, and website reliability and transactional capabilities age larger banks in Australia offer more variety services than smaller banks. Nevertheless, small and medium coat banks in Australia have found to provide more user-friendly services than larger banks and are no-hit in offering personal banking services.Internet Banking In MalaysiaSince achieving independence in the 1957 banking activities in Malaysia has changed enormously with appearances of untried technology application. In the 1980, the first automatise teller Machines ( specie dispensers) was introduced which was be the intimately visible piece of turn up of the em erging electronic banking in Malaysia. ATM is a computerized telecommunications device that used for transfer funds between checking, balance enquiry, cash withdrawal, obstetrical deliverys and credit card accounts, bill payments, making cash and check deposits and making payments to application for initial public offerings in Kuala Lumpur Stock Exchange. This technology brought the revolution were longer banking hours which unlimited beyond office hours (BNM Annual Reports, 1985-1997).Apart from this, the next changes in this evolutionary process go out be the telebanking and PC-banking in the 1990s. In the early 1990 telebanking was introduced in Malaysia as delivery channel for branch financial services via telecommunications devices committed to an automated system of the bank where customers endure perform retail banking transactions through using Automated Voice Response (AVR) technology. The functions of telebanking are almost similar to the ATM services except withdrawal and deposit of cash. Telebanking brings convenience, extended access and signifi laughingstockt time sparing to the customers. The want of cash withdrawal function in telebanking leads to the poor customer response to telebanking.In the 1990s, ten local anesthetic commercial banks are offering PC-banking or home banking services. PC-banking is an online banking device which customer can utilize their computers in anywhere anytime for account transactions by subscribing and controling into the banks intranet proprietary software system. PC-banking can raise speed, decrease cost and enhance flexibility of profession transactions which is more suitable among corporate customers. In the half of 1990, the number of customer that utilizes this service lock up small. This is because they face some jobs, such as risk in transacting on the internet, deprivation of trust and loyalty of customer and poor of product and service quality.In this table indicates that relative frequency of familiarity and usage of using ATM is the highest and PC-banking is the concluding percentage. ATM can attracted all of banking customer to use this service because it really brings convenience to the customer since it can save time, reduce obstruction, and enhance flexibility of business transaction to customers. There are 80% that not using telebanking because this service cant provide any cash withdrawal function. However, PC-banking also faced lack of attraction from banking customers due to the new banking service that introduced to this country, which most of customer still unable to accept this new internet service. When customer utilize PC-banking, they may face some riddles, such as risk in transacting on the internet, lack of trust and loyalty of customer and product and service quality.Furthermore, e-banking in Malaysia is become increasingly popular on developments in information technology and telecommunications. In Malaysia internet banking service (IBS) was estab lished in six years ago (The Star, 2005). IBS is a convenience and new physical banking service which is to attain more potential customers as it allows bankers to deliver banking services to a wider segment of customers through electronic and interactive communication channels (Goi, 2005), with 12 domestic banks offering IBS to 4.5million subscribers currently (Bank Negara Malaysia, 2007). So surprisingly internet banking has become one of the popular services with 51 percent out of 8,000 of nub respondents once a month.In the beginning, there are 5 Malaysia banks have invested millions of ringgit in online banking but these banks are still functioning as dial up intranet facilities. The online service is still unavailable for customers because of the insufficiency of statutory framework and security concerns. The investment may be wasted due to the deficiency of pregnant business understanding to support customer adoption if a bank introduces Internet Banking Services without a drop off understanding of factors influencing customer adoption (Goi, 2005 Pires and Aisbett, 2002).In table 1 it illustrates the demographic characteristics of the internet bank users and the non-internet bank users among the sample respondents was analyzed. Mean monthly income is the only significant difference appears which it assumed that the internet bank user monthly income is super than non-internet bank user. It also shows that there is no significant difference between the destine age of the internet bank users and the non-internet bank users. These two groups are equal in percentage of graduates and undergraduates in which both of the groups are nearly virtually 85%.Background of pick upThe designing of this research is to place and evaluate the consumers perception toward e-banking. Consumer perception is important to bankers because of that banker can only understand and shape what customer truly wants to and how e-banking service shall satisfy them. There are some unsettleds volition be discussed which are affect the growth of e-banking in Malaysia. From the customers perspective, internet banking assists a convenient and effective approach to control personal finances without visit the bank and from any locations, as it is fond 24 hours a day and 365 days in a year (Rotchanakitumunai and Speece, 2003). by this report we go outing discuss slightly different countries have different customers perception about e-banking. This research also studies whether service or service quality impart influences the trust and leaveingness of customer for using e-banking.Besides that, we also explore the factors which are taken to assess customer perception toward various application of internet banking. The factors that go forth be assessed are convenience of account transaction, flexibility, reliability, save time and cost. Internet banking is convenient, no geographical barriers, low cost and isnt bound by operational timings (IAMAIs, 2006 ). to a greater extent than 50% of total respondents agreed that e-banking is convenient and flexible ways of banking and it also have a variety of transaction colligate advantages (Divya and Padhmanabhan, 2008). The purposes of internet banking consist of customer convenience through personalized service, cost containment through decline in operating cost, revenue expansion through reveal quality and additional non-financial services, and performance enhancement by making the service from any location (Bradley Stewart, 2002 Chau Lai, 2003 Frust et al., 2000 Suganthi Balachandran, 2001). How saving of cost and time affect the perception of customer toward e-banking are also analyzed. So this research main purpose is to examine the variables of the actual perception of customer toward e-banking.Problem narrativeThis research explores and examines some topics which are important elements that help in consumers perception toward e-banking. Banker should understand the need of cus tomer so that they can improve the deficient of the services. Banker should find out the way to attract more customers to utilize their services.In line with global trends, most customers are not localiseing on this internet application. So, we need to shape this problem regarding the importance of the e-banking among customer in the local area. Customer should translate to use internet banking which can bring conveniences without going to the bank. and so customers will obtain savorment with the system when it provides them maximum convenience era bank transaction is occurred. The convenience of internet banking is contributing to changing patterns in cash withdrawal and day to day money management and assisting people gain greater control of their finances (Beer, 2006).On the other hand, there are few factors that lead to this problem occurrence. Firstly, not many people start to use e-banking because they still not trust on the system through internet. They will worry and always have a doubt about whether their money is safe. In addition there are few cases of shammer have been reported in online banking. The hacker wills forgery information by entering person information without the owner knowing and takes out his/her money.Secondly, there are lacks of social contact because internet banking dont have any assistance will be served to customer. It will create obstruction to the customer since in the bank there will be banker which will helps and assists customer needs. They will easily give up since there are many lack of skill problems occurred when utilizing the systems. Besides that, it is difficult to do survey since there are a lot of public are faced terminal point of time, because it may take times to explicate to the public. interrogation objectiveTo identify what influence consumers perception toward e-bankingTo determine the factors that affecting consumer perception toward e-bankingTo find out how service quality influences internet b anking userTo identify the close why customer use internet bankingTo solve the problem customer face toward internet bankingTo increase the knowledge of customer toward internet bankingTo improve the insufficient of the internet banking servicesTo enhance the loyalty and trust between consumer and e-bankingSignificance of registerThis research is contributed to give customers to better understand about e-banking. There are many features and characteristics of the e-banking that many people still no realize about it. Through this research, we will interview a numeral of people and will explain about internet banking to give consumer to better understand the services that already provided to help them to ease their life. For example, CIMB offers CIMB Bank AirAsia Savers Account, a paperless account which customer will directly enjoy the convenience of viewing their account dictation online without require a passbook (AirAsia Berhad, 2007-2010). Such a not bad(predicate) service p rovided by bank, customer practise know about it if they no utilize internet banking.This nurture has unite varieties of factors from past research to study consumers perception toward e-banking. Both practitioners and academics can obtain the advantages by to better understand the consumers perception in the value of internet banking services. Furthermore, they can also identify the deficiency of the service in e-banking through this research so that the service would be improved to match customers requirement. Hence, customer can properly understand and adapt the problem that they face as necessary.In Malaysia, Maybank has become the first bank to introduce internet banking services (Maybank2u.com) and an combined web-based cash management portal on June 1, 2000. The online banking services will allow customer to perform bill payment, banking enquiry functions, funds transfer, credit card payment and accounts summary as well as transaction history (Suganthi, Balachandher and Bal achandran, 2001). However, the influence of consumers acceptance e-banking in Malaysia seems more contend because of the deficiency of information and academic in e-banking. orbital cavity of studyThe scope of study is only distill about consumer area and perception toward e-banking. In this study, the research will be focus on MMU student, CIMB banking users and businessman that will regularly using banking service. The reason that we choose MMU student is because MMU student will often using online banking systems to pay tuition fees, transfer fund to their friends, check for their transaction account anywhere anytime. Apart from this they can teach their parent to use these services since it is very convenience and saving time, especially to those parent that very busy with their work. Besides that, we also focus on CIMB bank users which they can provide some information through interviews or questionnaires. Then, we will determine how depth the respondents understand about in ternet banking and what their comment regarding e-banking. Through this research we will resolve the incompetent and insufficient of service of internet banking.In addition to this, for positive(predicate) business man they want to utilize some social function that very fast, time-saving, and can assist to their business. They can conduct most of their business on the internet and take form transactions between their businesses without going to the bank. It can guarantee service quality for users conducting business transactions while utilizing IT applications and infrastructure. Through this research we can ask for some proposal or any dissatisfied regarding internet banking from different view of business man, CIMB bank users and MMU student.Limitation of the studyThe extension of this study include there are large amounts of people still dont have the internet connection in their home and some dont know how to use e-banking services which will precede in lack of internet ban king users. There is a need for public knowledge to deal with computers and browsers since there are a lot of public still unable to use the internet applications. Besides that, it will lead to the difficulty of development of e-banking in the country. Customer may prefer visiting the bank branch because there are lacks of social contact regarding e-banking will creates difficulty to the customer since in the bank there will be banker which will helps and assists customer needs. Then it may take some time to learn and trance to use to internet banking, as it requires a lot of procedures. If banks server down, customer may not access to the website.Secondly, the limitation that I faced is the difficulty of communication with the respondents when interviewing and collecting selective information for my research. Some of the people will resist for doing the research survey because they fantasy I wanted to promote or sell something. The thing that I frequently faced is impact people who reject to answer any question out front I start to talk about my research purpose.Organization of researchIn chapter 1, the main statute title is introduction which is a beginning subdivision that states the internet banking among difference countries. Background of study explaining what about of a particular topic is placed. Problem statement is focus on the attention of the problem solving team. query objective is writing about the purpose of this research. In significant of study, I will shift from the particular to the general, and present the importance of the study from grade beneficiaries to the people in the community, to the people in the region and nation. Scope of study is focus on the coverage of areas in this research such as student and businessman. The limitation of study is about the restriction that I facing during doing this research.In addition, Chapter 2 is literature checks. In this chapter reviews and introduces the preceding journals related age, i ncome, education, sexual practice, convenience, perceived ease of use, reliability, saving time and cost, service or service quality and trust. I will focus on how these free-living variables influence consumers adoption of internet banking. There will be an overview of some journals about consumers adoption toward e-banking will be presented which will used to examine the relationship between independent and dependent variables.In Chapter 3 it is about research methodology that including theoretical framework, hypothesis of study, data collection and data analysis. In theoretical framework, I will suggest the integrative interrelationships among important variables in the research which is includes age, income, education, gender, convenience, perceived ease of use, reliability, saving time and cost, service or service quality and trust. There are four method are used in data analysis, which are frequency distribution, Pearsons coefficient of correlation coefficient, cross tabul ation and descriptive analysis.Chapter 2 Literature ReviewIntroductionIn this chapter 2, I review many journals about this topic in the various area of e-banking. In the 2.2 those journals are study about demographic affects the consumers adoption toward e-banking. In the 2.3, those journals are look into the factors that influence the consumers adoption toward e-banking. In the 2.4, those journals are investigating about the service or service quality which will influence consumers adoption. In the 2.5, those journals are investigating about influence of trust toward consumers adoption.demographicAccording to Kim,Widdows and Yilmazer (2005), age were influencing the attitude of consumers towards internet banking and their ability for training how to do investment. The younger age groups of consumers are more liable(predicate) to invest the time to learn to utilize internet banking because this group of consumers can translate more advantages through time saving. Besides that, high income of consumers will have high value of time than consumers with debase income, so higher(prenominal)(prenominal) income of the consumer can generate more advantages through adoption of internet banking. More better consumers may involve fewer training in response to technological change if their general skills facilitate them to be taught the new technology (Bartel and Sicherman, 1998). They also indicated that adoption internet banking of well educated individuals is faster than less educated individuals due to the internet banking, new technology, and warrantees decline of the time required for money transactions.In Padachi, Rojid and Seetanah (2007) report examined that the younger generation the more they like to utilize the new technological advancements as they are more prefer to adopt e-banking compared to the sr. generation. Mean age of internet banking users is 45 and 47 for non-internet banking users. Furthermore, the higher of education and income ladder w ill lead to the greater the prospect of customer adopting internet banking. There are 57% of respondent having an education level in the category post graduate and 33% in the category of undergraduate utilizes the service. There are 48% of people using the internet banking that have the income group of Rs 30000 to 49000, which means the higher income earners are more sensible in utilizing internet.In the Jane, Jeanne and Marianne (2004) report explores the discoveries of demographic correlates of technology acceptance have constructed varying results with respect to important relationships to adoption. man force and women show to have dissimilar acceptance rates of specific computer technologies which men will more prefer on adopting technologies application(Gefen and Straub, 1997), but gender appear not to be found to have a direct on adoption of technology in general (Taylor and Todd, 1995 Gefen and Straub, 1997). The research show that the probability of higher income household s ($75000 or more) being current users of ABP was 15 points higher than low income households (under $25000) and was more likely to adopt e-banking. However, research examined younger persons are being more likely to adopt which has also linked age and adoption of technologies (Zeithaml and Gilly, 1987 Trocchia and Janda, 2000 Karjaluoto, 2002 Lee, 2002). The research shows that the age of 65 of respondents were less likely to adopt phone banking and PC banking compared to medium and youngest group. pot with marital status are more likely to adopt than single viriles or females because when it comes to bank accounts, married couples may have jointly held accounts. In region variable households living in the northeast were more likely than in the midwest to have adopted or to intend to adopt phone banking or ABP.In the Demographic characteristics of Western Australian users of electronic banking journal published by Catherine, Simone and Katherine (2005) explored that most online banking customers were male while the majority of telephone banking customers were females. Australian Bureau of Statistics (ABS), 2001 stated that consumers of Western Australia, who are between 18 and 24 years of age, employed, male, have higher levels of education, and higher incomes have been examined to be more likely to use information technology that those are older, unemployed, lower incomes and have lower levels of education. The authors also examined 58.4% of the internet banking users are being in professional, administrative, managerial or para-professional occupations. This is because males in these occupations often utilize technologies such as computers and the internet in the workplace, providing them access to the required hardware and mayhap encouraging a preference for online interaction with providers. Filoto, Tanzi and Saita (1997) Jayawardhena and Foley (2000) Thornton and White (2001) Pereira (2002) have found these customers may be on higher incomes due to th eir more educated and/or highly skilled and therefore they are in occupations that need them to be more practiced at using technology-based service delivery modes. Mitchell (1998) and Tan (1999) stated that education may not be an important survey for EFTPOS users because transactions are usually performed in retail settings and they involve retail personnel who assist the utmost of transactions for consumers. Jayawardhena and Foley (2000), Orenstein (1998) and Thornton and White (2001) argued that online banking consumers are more likely to have higher than average education and they may frequently be students because of their higher delineation to technologies such as internet and computer. Councils on the Ageing (2002) stated that in some studies have recommended that older consumers may be discouraged from the utilization of electronic banking by issues such as limitation of mobility and visibility.In Jun Wu, 2005 report examined that the products and services people purchase varies during the different stages of their lives. The result of demographic age profile in this research shows that the 21 to 29 age group is dominant. Furthermore, consumers that more educated will have more money available to spend because of better education, and this influences their life-styles. Wilkie (1990) stated that it will influences which type of products they purchase, what kind of stores to purchase them in, and what prices they are willing to pay as people achieve higher education. Customers with better educated be likely to have better paying occupations than not well educated customers (Schiffman and Kanuk, 2000) because a persons level of education can affect strongly on their ability to create income and their consumer consumption potential. Polatoglu and Ekin (2001) explored that high levels of education improve a consumers ability to process more complicated information and make decisions. Income is a famous demographic variable for segmenting markets due to the income levels affect consumer wants and determines their purchasing power (Lamb, 2000). Purchasing power is influenced by inflation, recession, the international valuAdvantages of E-bankingAdvantages of E-bankingChapter 1 IntroductionIntroductionNowadays, Malaysia is a multi sector economy and technology development based on the presence of many technological inventions. Traditional banking act as physical bank and delivery channel which to give customers to place or get their money out of the bank safety deposit boxes, managing checking or current accounts, paying cheques drawn by customers. However, e-banking is one of the technological inventions that give conveniences to customers to manage financial transactions on a secure website performed by retail or virtual bank, credit union or building society.E-banking is also called electronic banking which is the automated delivery of new banking services and products directly to customers through electronic, interactive communica tion channels. It brings many benefits and capabilities to customer compared to traditional banking. E-banking is fast and convenient way of using computer to easy access to the bank in 24hours. E-banking utilizes the internet system as the delivery channel by which to accomplish banking activity, for example, paying bills, transferring funds, viewing checking and savings account balances, paying mortgages and purchasing financial instruments and certificates of deposits (Haque et al, 2009).Internet banking enable customers to access their general information and accounts of bank products and services through PC or other intelligent device using web browser software on 24 hours a day and 7days a week, such as Netscape Navigator or Microsoft internet explorer (Mohamad, Hanudin, Suddin, Noren, 2007). The development in information technology have had an tremendous effect in development of more flexible payment methods and more user-friendly banking services in the world of banking (Se rkan, Safak, Eda, 2004).There are some features that fall into several categories of internet banking which are transactional, non-transactional, financial institution administration, support of multiple users having varying levels of authority, transaction approval process and wire transfer. In transactional, e-banking act as account and financial transactions, pay bills, wire transfer and apply for loan or new account, investment purchase or sale and others. Electronic Bill Presentment and Payment (EBPP) is an electronic billing which customer can pay bill and receives payment easily, faster, and conveniently over anywhere and any times.Customer perception is interpretation of sensory mind and experienced by customer. The convenience of e-banking are attracted customers and provided no cost charged to customers. Customers have started accepting this internet service and assessing the banks based on their easy to access and convenience. With great confidence toward e-banking, custo mers are willing uses the internet banking to transfer fund, pay bills, and lot more with a excellent-secured system. It also can establish the relationship between trust and loyalty of customer toward e-banking.Internet banking in USA and EuropeThe dramatic growth in internet usage has generated a segment of customers with the ability and desire to conduct banking transactions completely online (Mathew and George, 2003). The internet explosion in the late-1990s brings people more convenience with various applications over the web. In the mid-1990s, customers using internet as monetary business transaction over the web as the financial institutions had implemented e-banking. The majority of US-based banks are escalating their investment in technology and hedging their bets while research specifies that a substantial portion of the customer base may always demand the type of personal interaction that can only be provided by individual branch personnel (Alstad, 2002). TowerGroups pred iction is highlighted by CRMToday on IT spending by large banks in USA, which the amounts is 24.1 billion in 2004 as compare to 22 billion in 2002.Besides that, many US banks, such as Bank of America and Umpqua Bank are lending from social media channels, offering social networking, pod casting, web casts and other interactive tools. Now competitors can establish an internet bank for as little as $6 million in the USA compared to the cost of setting up a traditional brick and mortar bank (estimated at between $25 and $30 million) (Nathan, 1999). CRMToday (2003a) also stated that without major consumers adoption internet banking would not achieve as profitable as promise although there are increasing in amounts of online banking customers.According to the European Central Bank in 2002 (centeno, 2003), the level of services and its quality differ according to the country and the banks even though all main banks provide internet banking services. Bughin, 2001 investigated that the adop tion rate is examined to be averaging only 17% of internet users or less than 6% of total bank customers. The author also stated that there are 60% internet customers do not have subject in buying books, CDs or low valued item through online but are reluctant to create online banking transactions.Furthermore, there are differences of internet banking adoption also existed among some countries in Europe. Around 18-25% of populations in Estonia are utilizing internet banking services whereas Italian bank had about no on-line customers by early 2000, banks in Malta initiated internet banking services in December 2002 (Centeno, 2003). Furthermore, there are differences of adoption among banks within the same country. Bughin (2001) stated an example, a leading banks in France have diffusion rate over 11% while minor bank such as the credit commercial de France have translated only 2% of its customers to online for the same period.Internet banking in TurkeyIn Turkey, there are over 18% of banking customers using e-banking actively (Jamaluddin, Osman, Sukru and Kemal, 2008). Since 1997 internet banking has been recognized as a feasible alternative distribution channel by Turkish commercial banks due to the deregulation in the financial sector, escalation of computer literacy, the rapid diffusion of electronic commerce, strong commitments to reduce operating costs, changing customer demands for innovative financial products and services and create customer convenience (Hakan, 2008). Due to the low cost of attracting customer to utilize internet banking and retaining existing innovation-demanding customers during the past two decades, most of Turkish commercial banks found it irresistible to invest large amounts in online banking although the customer take up of internet banking appeared to be very slow.In addition, the actual number of utilizing e-banking users appeared to be between 1 and 1.2 million (30%) in 2003 although 2million people (50%) were forecasted to uti lize e-banking by 2003 (Akinci, 2004 Celik, 2002 Ozkan, 2003). Furthermore, in turkey the numbers of active internet banking accounts are escalating from 150,000 in 2000 to 5.5 million in 2007 and grew annually by 68 percent (Higgs, 2000). In comparison, although this illustrates that internet banking has experienced strong and sustained growth since its inception, Turkey has a lower internet banking penetration rate than that of many European countries. The research on internet banking by individual customers in the country has been required to improve customers understanding of how their particular beliefs or motives affect their utilization of the services.Internet Banking In AustraliaInternet banking growth continued rapidly in Australia with a 26 % increase in the internet banking customer population to 5.5 million users (approximately 34% of the adult population) going on over the 12 months to May 2005 (ACNielsen, 2005). The report stated there are over 7.2 million consumers a ccessed 27 millions accounts in 2003 which is an increase of 31% compared to 16.2% in 2002 (MISC, 2004). The report showed that users are more efficient in utilizing Internet banking services and transacting more amounts utilizing fewer sessions.Furthermore, internet banking services are increasingly attracted among users women and 50+ years age group is the highest growing in all category. There are 54% of Australian adults were utilizing telephone banking and an estimated 25% of employed internet banking after a period of strong electronic banking market development between 1997 and 2002. Small and medium banks in USA provide more user-friendly services than larger banks and achieved well in the area of personal internet banking, and website reliability and transactional capabilities while larger banks in Australia offer more variety services than smaller banks. Nevertheless, small and medium sized banks in Australia have found to provide more user-friendly services than larger ba nks and are successful in offering personal banking services.Internet Banking In MalaysiaSince achieving independence in the 1957 banking activities in Malaysia has changed enormously with appearances of new technology application. In the 1980, the first Automated teller Machines (ATMs) was introduced which was be the most visible piece of evidence of the emerging electronic banking in Malaysia. ATM is a computerized telecommunications device that used for transfer funds between checking, balance enquiry, cash withdrawal, savings and credit card accounts, bill payments, making cash and check deposits and making payments to application for initial public offerings in Kuala Lumpur Stock Exchange. This technology brought the revolution were longer banking hours which unlimited beyond office hours (BNM Annual Reports, 1985-1997).Apart from this, the next changes in this evolutionary process will be the telebanking and PC-banking in the 1990s. In the early 1990 telebanking was introduced in Malaysia as delivery channel for branch financial services via telecommunications devices connected to an automated system of the bank where customers can perform retail banking transactions through using Automated Voice Response (AVR) technology. The functions of telebanking are almost similar to the ATM services except withdrawal and deposit of cash. Telebanking brings convenience, extended access and significant time saving to the customers. The insufficiency of cash withdrawal function in telebanking leads to the poor customer response to telebanking.In the 1990s, ten local commercial banks are offering PC-banking or home banking services. PC-banking is an online banking device which customer can utilize their computers in anywhere anytime for account transactions by subscribing and dialing into the banks intranet proprietary software system. PC-banking can raise speed, decrease cost and enhance flexibility of business transactions which is more suitable among corporate cust omers. In the half of 1990, the number of customer that utilizes this service still small. This is because they faced some problems, such as risk in transacting on the internet, lack of trust and loyalty of customer and poor of product and service quality.In this table indicates that frequency of familiarity and usage of using ATM is the highest and PC-banking is the lowest percentage. ATM can attracted all of banking customer to use this service because it really brings convenience to the customer since it can save time, reduce difficulty, and enhance flexibility of business transaction to customers. There are 80% that not using telebanking because this service cant provide any cash withdrawal function. However, PC-banking also faced lack of attraction from banking customers due to the new banking service that introduced to this country, which most of customer still unable to accept this new internet service. When customer utilize PC-banking, they may face some problems, such as ri sk in transacting on the internet, lack of trust and loyalty of customer and product and service quality.Furthermore, e-banking in Malaysia is become increasingly popular on developments in information technology and telecommunications. In Malaysia internet banking service (IBS) was established in six years ago (The Star, 2005). IBS is a convenience and new physical banking service which is to attain more potential customers as it allows bankers to deliver banking services to a wider segment of customers through electronic and interactive communication channels (Goi, 2005), with 12 domestic banks offering IBS to 4.5million subscribers currently (Bank Negara Malaysia, 2007). So surprisingly internet banking has become one of the popular services with 51 percent out of 8,000 of total respondents once a month.In the beginning, there are 5 Malaysia banks have invested millions of ringgit in online banking but these banks are still functioning as dial up intranet facilities. The online s ervice is still unavailable for customers because of the insufficiency of legal framework and security concerns. The investment may be wasted due to the deficiency of important business understanding to support customer adoption if a bank introduces Internet Banking Services without a clear understanding of factors influencing customer adoption (Goi, 2005 Pires and Aisbett, 2002).In table 1 it illustrates the demographic characteristics of the internet bank users and the non-internet bank users among the sample respondents was analyzed. Mean monthly income is the only significant difference appears which it assumed that the internet bank user monthly income is highly than non-internet bank user. It also shows that there is no significant difference between the mean age of the internet bank users and the non-internet bank users. These two groups are equal in percentage of graduates and undergraduates in which both of the groups are nearly about 85%.Background of studyThe purpose of t his research is to identify and evaluate the consumers perception toward e-banking. Consumer perception is important to bankers because of that banker can only understand and determine what customer actually wants to and how e-banking service shall satisfy them. There are some variables will be discussed which are affecting the growth of e-banking in Malaysia. From the customers perspective, internet banking assists a convenient and effective approach to control personal finances without visiting the bank and from any locations, as it is accessible 24 hours a day and 365 days in a year (Rotchanakitumunai and Speece, 2003). Through this report we will discuss about different countries have different customers perception about e-banking. This research also studies whether service or service quality will influences the trust and willingness of customer for using e-banking.Besides that, we also explore the factors which are taken to assess customer perception toward various application of internet banking. The factors that will be assessed are convenience of account transaction, flexibility, reliability, save time and cost. Internet banking is convenient, no geographical barriers, low cost and isnt bound by operational timings (IAMAIs, 2006). More than 50% of total respondents agreed that e-banking is convenient and flexible ways of banking and it also have a variety of transaction related advantages (Divya and Padhmanabhan, 2008). The purposes of internet banking consist of customer convenience through personalized service, cost containment through decline in operating cost, revenue expansion through better quality and additional non-financial services, and performance enhancement by making the service from any location (Bradley Stewart, 2002 Chau Lai, 2003 Frust et al., 2000 Suganthi Balachandran, 2001). How saving of cost and time affect the perception of customer toward e-banking are also analyzed. So this research main purpose is to examine the variables o f the actual perception of customer toward e-banking.Problem statementThis research explores and examines some topics which are important elements that help in consumers perception toward e-banking. Banker should understand the need of customer so that they can improve the insufficient of the services. Banker should find out the way to attract more customers to utilize their services.In line with global trends, most customers are not focusing on this internet application. So, we need to solve this problem regarding the importance of the e-banking among customer in the local area. Customer should learn to use internet banking which can bring conveniences without going to the bank. Then customers will obtain satisfaction with the system when it provides them maximum convenience while bank transaction is occurred. The convenience of internet banking is contributing to changing patterns in cash withdrawal and day to day money management and assisting people gain greater control of their finances (Beer, 2006).On the other hand, there are few factors that lead to this problem occurrence. Firstly, not many people start to use e-banking because they still not trust on the system through internet. They will worry and always have a doubt about whether their money is safe. In addition there are few cases of fraud have been reported in online banking. The hacker wills forgery information by entering person information without the owner knowing and takes out his/her money.Secondly, there are lacks of social contact because internet banking dont have any assistance will be served to customer. It will create difficulty to the customer since in the bank there will be banker which will helps and assists customer needs. They will easily give up since there are many lack of skill problems occurred when utilizing the systems. Besides that, it is difficult to do survey since there are a lot of public are faced limitation of time, because it may take times to explain to the public. Research objectiveTo identify what influence consumers perception toward e-bankingTo determine the factors that affecting consumer perception toward e-bankingTo find out how service quality influences internet banking userTo identify the reason why customer use internet bankingTo solve the problem customer face toward internet bankingTo increase the knowledge of customer toward internet bankingTo improve the insufficient of the internet banking servicesTo enhance the loyalty and trust between consumer and e-bankingSignificance of studyThis research is contributed to give customers to better understand about e-banking. There are many features and characteristics of the e-banking that many people still no realize about it. Through this research, we will interview a numeral of people and will explain about internet banking to give consumer to better understand the services that already provided to help them to ease their life. For example, CIMB offers CIMB Bank AirAsia Savers Account, a paperless account which customer will directly enjoy the convenience of viewing their account statement online without require a passbook (AirAsia Berhad, 2007-2010). Such a good service provided by bank, customer wont know about it if they no utilize internet banking.This study has combined varieties of factors from past research to study consumers perception toward e-banking. Both practitioners and academics can obtain the advantages by to better understand the consumers perception in the value of internet banking services. Furthermore, they can also identify the deficiency of the service in e-banking through this research so that the service would be improved to match customers requirement. Hence, customer can properly understand and adapt the problem that they face as necessary.In Malaysia, Maybank has become the first bank to introduce internet banking services (Maybank2u.com) and an combined web-based cash management portal on June 1, 2000. The online banking services will a llow customer to perform bill payment, banking enquiry functions, funds transfer, credit card payment and accounts summary as well as transaction history (Suganthi, Balachandher and Balachandran, 2001). However, the influence of consumers acceptance e-banking in Malaysia seems more challenging because of the deficiency of information and academic in e-banking.Scope of studyThe scope of study is only concentrate about consumer area and perception toward e-banking. In this study, the research will be focus on MMU student, CIMB banking users and businessman that will regularly using banking service. The reason that we choose MMU student is because MMU student will often using online banking systems to pay tuition fees, transfer fund to their friends, check for their transaction account anywhere anytime. Apart from this they can teach their parent to use these services since it is very convenience and saving time, especially to those parent that very busy with their work. Besides that, we also focus on CIMB bank users which they can provide some information through interviews or questionnaires. Then, we will determine how depth the respondents understand about internet banking and what their comment regarding e-banking. Through this research we will resolve the inadequate and insufficient of service of internet banking.In addition to this, for sure business man they want to utilize something that very fast, time-saving, and can assist to their business. They can conduct most of their business on the internet and make transactions between their businesses without going to the bank. It can guarantee service quality for users conducting business transactions while utilizing IT applications and infrastructure. Through this research we can ask for some suggestion or any dissatisfied regarding internet banking from different view of business man, CIMB bank users and MMU student.Limitation of the studyThe extension of this study include there are large amounts of people still dont have the internet connection in their home and some dont know how to use e-banking services which will result in lack of internet banking users. There is a need for public knowledge to deal with computers and browsers since there are a lot of public still unable to use the internet applications. Besides that, it will lead to the difficulty of development of e-banking in the country. Customer may prefer visiting the bank branch because there are lacks of social contact regarding e-banking will creates difficulty to the customer since in the bank there will be banker which will helps and assists customer needs. Then it may take some time to learn and get to use to internet banking, as it requires a lot of procedures. If banks server down, customer may not access to the website.Secondly, the limitation that I faced is the difficulty of communication with the respondents when interviewing and collecting data for my research. Some of the people will resist for doing the resear ch survey because they thought I wanted to promote or sell something. The thing that I frequently faced is meeting people who reject to answer any question before I start to talk about my research purpose.Organization of researchIn chapter 1, the main title is introduction which is a beginning section that states the internet banking among difference countries. Background of study explaining what about of a particular topic is placed. Problem statement is focus on the attention of the problem solving team. Research objective is writing about the purpose of this research. In significant of study, I will shift from the particular to the general, and present the importance of the study from target beneficiaries to the people in the community, to the people in the region and nation. Scope of study is focus on the coverage of areas in this research such as student and businessman. The limitation of study is about the restriction that I facing during doing this research.In addition, Chapt er 2 is literature reviews. In this chapter reviews and introduces the previous journals related age, income, education, gender, convenience, perceived ease of use, reliability, saving time and cost, service or service quality and trust. I will focus on how these independent variables influence consumers adoption of internet banking. There will be an overview of some journals about consumers adoption toward e-banking will be presented which will used to examine the relationship between independent and dependent variables.In Chapter 3 it is about research methodology that including theoretical framework, hypothesis of study, data collection and data analysis. In Theoretical framework, I will suggest the integrative interrelationships among important variables in the research which is includes age, income, education, gender, convenience, perceived ease of use, reliability, saving time and cost, service or service quality and trust. There are four method are used in data analysis, whic h are frequency distribution, Pearsons correlation coefficient, cross tabulation and descriptive analysis.Chapter 2 Literature ReviewIntroductionIn this chapter 2, I review many journals about this topic in the various area of e-banking. In the 2.2 those journals are investigating about demographic affects the consumers adoption toward e-banking. In the 2.3, those journals are investigating the factors that influence the consumers adoption toward e-banking. In the 2.4, those journals are investigating about the service or service quality which will influence consumers adoption. In the 2.5, those journals are investigating about influence of trust toward consumers adoption.DemographicAccording to Kim,Widdows and Yilmazer (2005), age were influencing the attitude of consumers towards internet banking and their ability for learning how to do investment. The younger age groups of consumers are more likely to invest the time to learn to utilize internet banking because this group of cons umers can generate more advantages through time saving. Besides that, higher income of consumers will have higher value of time than consumers with lower income, so higher income of the consumer can generate more advantages through adoption of internet banking. More educated consumers may involve fewer training in response to technological change if their general skills facilitate them to be taught the new technology (Bartel and Sicherman, 1998). They also indicated that adoption internet banking of well educated individuals is faster than less educated individuals due to the internet banking, new technology, and warrantees reduction of the time required for money transactions.In Padachi, Rojid and Seetanah (2007) report examined that the younger generation the more they like to utilize the new technological advancements as they are more prefer to adopt e-banking compared to the older generation. Mean age of internet banking users is 45 and 47 for non-internet banking users. Further more, the higher of education and income ladder will lead to the greater the probability of customer adopting internet banking. There are 57% of respondent having an education level in the category post graduate and 33% in the category of undergraduate utilizes the service. There are 48% of people using the internet banking that have the income group of Rs 30000 to 49000, which means the higher income earners are more sensible in utilizing internet.In the Jane, Jeanne and Marianne (2004) report explores the discoveries of demographic correlates of technology acceptance have constructed varying results with respect to important relationships to adoption. Men and women show to have dissimilar acceptance rates of specific computer technologies which men will more prefer on adopting technologies application(Gefen and Straub, 1997), but gender appear not to be found to have a direct on adoption of technology in general (Taylor and Todd, 1995 Gefen and Straub, 1997). The research show tha t the probability of higher income households ($75000 or more) being current users of ABP was 15 points higher than low income households (under $25000) and was more likely to adopt e-banking. However, research examined younger persons are being more likely to adopt which has also linked age and adoption of technologies (Zeithaml and Gilly, 1987 Trocchia and Janda, 2000 Karjaluoto, 2002 Lee, 2002). The research shows that the age of 65 of respondents were less likely to adopt phone banking and PC banking compared to medium and youngest group. People with married status are more likely to adopt than single males or females because when it comes to bank accounts, married couples may have jointly held accounts. In region variable households living in the northeast were more likely than in the midwest to have adopted or to intend to adopt phone banking or ABP.In the Demographic characteristics of Western Australian users of electronic banking journal published by Catherine, Simone and K atherine (2005) explored that most online banking customers were male while the majority of telephone banking customers were females. Australian Bureau of Statistics (ABS), 2001 stated that consumers of Western Australia, who are between 18 and 24 years of age, employed, male, have higher levels of education, and higher incomes have been examined to be more likely to use information technology that those are older, unemployed, lower incomes and have lower levels of education. The authors also examined 58.4% of the internet banking users are being in professional, administrative, managerial or para-professional occupations. This is because males in these occupations often utilize technologies such as computers and the internet in the workplace, providing them access to the required hardware and possibly encouraging a preference for online interaction with providers. Filoto, Tanzi and Saita (1997) Jayawardhena and Foley (2000) Thornton and White (2001) Pereira (2002) have found these customers may be on higher incomes due to their more educated and/or highly skilled and therefore they are in occupations that need them to be more practiced at using technology-based service delivery modes. Mitchell (1998) and Tan (1999) stated that education may not be an important aspect for EFTPOS users because transactions are usually performed in retail settings and they involve retail personnel who assist the completion of transactions for consumers. Jayawardhena and Foley (2000), Orenstein (1998) and Thornton and White (2001) argued that online banking consumers are more likely to have higher than average education and they may frequently be students because of their higher exposure to technologies such as internet and computer. Councils on the Ageing (2002) stated that in some studies have recommended that older consumers may be discouraged from the utilization of electronic banking by issues such as limitation of mobility and visibility.In Jun Wu, 2005 report examined that the products and services people purchase varies during the different stages of their lives. The result of demographic age profile in this research shows that the 21 to 29 age group is dominant. Furthermore, consumers that more educated will have more money available to spend because of better education, and this influences their life-styles. Wilkie (1990) stated that it will influences which type of products they purchase, what kind of stores to purchase them in, and what prices they are willing to pay as people achieve higher education. Customers with better educated be likely to have better paying occupations than not well educated customers (Schiffman and Kanuk, 2000) because a persons level of education can affect strongly on their ability to create income and their consumer spending potential. Polatoglu and Ekin (2001) explored that high levels of education improve a consumers ability to process more complicated information and make decisions. Income is a famous demographic v ariable for segmenting markets due to the income levels affect consumer wants and determines their purchasing power (Lamb, 2000). Purchasing power is influenced by inflation, recession, the international valu