International

Journal of Management
(IJM), ISSN 0976
6502(Print), ISSN 0976(IJM)
- 6510(Online),
INTERNATIONAL
JOURNAL
OF MANAGEMENT
Volume 5, Issue 11, November (2014), pp. 61- 69 IAEME

ISSN 0976-6502 (Print)

ISSN 0976-6510 (Online)
Volume 5, Issue 11, November (2014), pp. 61-69
IAEME: http://www.iaeme.com/IJM.asp
Journal Impact Factor (2014): 7.2230 (Calculated by GISI)
www.jifactor.com

IJM
IAEME

A STUDY ON THE DEMO GRAPHICAL

CHARACTERISTICS OF INTERNET BANKING NONADOPTERS IN CHENNAI METROPOLITAN CITY WITH
REFERENCE TO INDIAN BANK
P.Saravanan1,

P.Sridharan2

Assistant Professor (Senior Grade), School of Management, SRM Faculty of Management,

Kattankulathur 603 203, Kanchipuram Dt., Tamil Nadu
2
Associate Professor and Head, Department of International Business, School of Management,
Pondicherry University, Puducherry 605014, Pondicherry

ABSTRACT
The financial service industry, especially banks, has responded to constant market changes by
adopting different types of delivery channel strategies. The emerging trend of Internet banking raises
important issues in the area of consumers banking behaviors and choices. Bank has to know the
consumers banking behaviors and choices. The consumers banking behaviors and choices depends
on their demographical characteristics. So, the bank has to know their customers demographical
characteristics. This study is carried out to identify the demographical characteristics of non users
of Internet Banking in Chennai Metropolitan city with reference to Indian Bank. Descriptive
Research design and Judgment sampling are used for this study. The Questionnaire was
administrated with 233 Savings Bank account holders of Indian Bank in Chennai. It is suggested that
awareness on Internet Banking products , services and its benefits to be created with the Savings
Bank account holders of Indian Bank irrespective of the gender, age, educational qualifications,
marital status , occupation and annual income. Also suggested that they have to be thought that there
is no complexity in using Internet Banking and also there is no risk. Their self-confidence to be
developed that they can be able to face the consequences of using Internet Banking. The bank will be
able to compete and survive in todays competitive environment, if they implement the suggestions
provided in this study.
Key words: Internet Banking, Demographic Characteristics, Non- Adoption.

61

International Journal of Management (IJM), ISSN 0976 6502(Print), ISSN 0976 - 6510(Online),
Volume 5, Issue 11, November (2014), pp. 61- 69 IAEME

1. INTRODUCTION
The financial service industry, especially banks, has responded to constant market changes by
adopting different types of delivery channel strategies. These market changes include: customer
banking tastes, preferences, increasing competition from non-banking financial institutions, shifting
demographic and social trends, government deregulation of the financial service industry and
technological innovation and development. The Automatic Teller Machine (ATM), telephone
banking, Personal Computer (PC) banking, and Internet banking are examples of how the banking
service industry has revolutionized since 1970s.
Evolution of Information Technology in the banking industry has speeded up communication
and transactions between banks and customers Giannakoudi, 1999).The emerging trend of Internet
banking raises important issues in the area of consumers banking behaviors and choices.
1.2. Operational Definition of Internet Banking
Internet banking can be described as the provision of information or services by banks to
their customers, via the Internet network. At the basic level, Internet banking involves a bank setting
up a World Wide Web (WWW) site to provide information about its products and services (Daniel,
1999; Sathye, 1999; Karjaluoto et al., 2002).
Pikkarainen, Karjaluoto, and Pahnila (2004) defines Internet banking as an Internet portal,
through which customers can use different kinds of banking services ranging from bill payment to
making investments. Internet banking gives customers access to almost any type of banking
transaction at the click of a button, except withdrawals.
1.3. The Internet Banking of Indian Bank
The following financial products and services are offered through Internet Banking of Indian
Bank .Service Tax Payment, LIC premium Payment , Central Excise Payment Status of Cheque
details, Online Share Trading System, Income Tax and TDS Payment, Transfer funds to their own
accounts, Viewing and Print out of account statements , Transfer funds to other Indian Bank
accounts, Indian Banks Depository Participant account , Tamil Nadu Electricity Board (TNEB) Bill
Payment , Indian Railway Catering and Tourism Corporation (IRCTC) Ticket Booking and
Remittance of funds to anyone having account with any other bank through RTGS/NEFT.
2. REVIEW OF LITERATURE
Murillo and Roismans (2004) were indicated that a banks decision to provide Internet
banking depends on the demographic characteristics of the customers such as gender, age, marital
status, educational qualifications, occupation and annual income etc., as well as whether the bank is
located in a metropolitan area. Demographic characteristics play a vital role in understanding the
buying behavior of consumers in different segments, and when the characteristics are identified, they
enable companies to develop products and services according to customers specific requirements,
tastes, and preferences (Sakkthivel, 2006).
Demographic factors are frequently used as a basis for understanding consumer
characteristics (Block and Roering, 1976; Lewis, 1981). The popularity of using demographic factors
is attributable to the observed relationship between the consumption of certain products and certain
demographic factors (Block and Roering, 1976). The demographic characteristics include age, sex,
income, occupation, education (Kotler, 1982).

62

International Journal of Management (IJM), ISSN 0976 6502(Print), ISSN 0976 - 6510(Online),
Volume 5, Issue 11, November (2014), pp. 61- 69 IAEME

3.1. Need of the Study

The decision to provide Internet Banking is currently perceived as vital for customer
retention and maintaining competitive advantage in the banking industry. For customer retention and
maintaining competitive advantage, bank has to know about their potential customers demographic
characteristics. This will help the bank to offer the products and services according to customers
specific requirements.
3.2. Statement of the Problem
Indian Bank is one of the nationalized bank and it is pioneer in computerization. It also
provides most of the Internet Banking products and services to the customers. In Chennai, only 5.8
% of the Savings Bank account holders of Indian Bank are availing Internet Banking. There are some
demographic characteristics which prevent the customers from availing Internet Banking. The
demographic characteristics which prevent the customers from availing Internet Banking have to be
identified
3.3. OBJECTIVES
To study the demographic characteristics of Internet Banking non- adopters in Chennai
Metropolitan City with reference to Indian Bank.
4. METHODS AND PROCEDURES
4.1. Research Design: Descriptive Research
4.2. Population: Internet banking non- users of Indian Bank in Chennai Metropolitan City.
4.3. Sample Size: The sample size 233 was arrived based on the results of Pilot study.
4.4. Sampling Method: Judgment sampling.
45. Instrument: The data required for the study is collected through a structured questionnaire
which was tested through pilot study and reliability test.
5. RESULTS AND DISCUSSION
Table 5.1: Respondents Gender wise Distribution
Non-users of Internet Banking
Gender
Frequency
Percentage
Male
135
58
Female
98
42
Total
233
100
(Source: Primary Data)

Figure 5.1: Respondents Gender wise Distribution

63

International Journal of Management (IJM), ISSN 0976 6502(Print), ISSN 0976 - 6510(Online),
Volume 5, Issue 11, November (2014), pp. 61- 69 IAEME

From the above table, it is observed that 58% of the respondents belong to the category of
male and 42% of the respondents belong to the category of female. Hence, it is inferred that more
number of male Respondents reluctant to avail Internet Banking.
Table 5.2: Respondents Distribution of age groups
Non-users of Internet Banking
Age group
(In Years)
Frequency
Percentage
18 years to 30 years
63
27
Above 30 years to 42 years
101
43
Above 42 years
69
30
Total
233
100
(Source: Primary Data)

Figure 5.2: Respondents Distribution of age groups

From the above table, it is observed that 43% of the respondents are in the age group of
above 30-42 years, followed by 30% of the respondents in the age group of above 42 years and 27 %
in the age group of 18-30 years. Hence, it is inferred that the maximum percentage of non-adopters
of Internet Banking belong to the age group of above 30-42 years.
Table 5.3: Marital status of the Respondents
Non-users of Internet Banking
Marital Status
Frequency
Percentage
Bachelor/ Spinster
54
23
Married
179
77
Total
233
100
(Source: Primary Data)

64

International Journal of Management (IJM), ISSN 0976 6502(Print), ISSN 0976 - 6510(Online),
Volume 5, Issue 11, November (2014), pp. 61- 69 IAEME

Figure 5.3 Marital status of the Respondents

From the above table, it is observed that 77% of the respondents are married and 23% are
Bachelor/Spinster. Hence, it is inferred that the respondents who got married do not prefer Internet
Banking than Bachelor / Spinster.
Table 5.4 Educational Qualification of the Respondents
Non-users of Internet Banking
Educational Qualification
Frequency
Percentage
Up to Hr. Sec.
47
20
Diploma
34
15
Under Graduate
89
38
Post Graduate
41
18
Professional Course
22
9
Total
233
100
(Source: Primary Data)

Figure 5.4 Educational Qualification of the Respondents

65

International Journal of Management (IJM), ISSN 0976 6502(Print), ISSN 0976 - 6510(Online),
Volume 5, Issue 11, November (2014), pp. 61- 69 IAEME

From the above table , it is observed that 38% of the respondents have completed Under
Graduate, followed by 20% of the respondents up to Hr. Sec., 18 % Post Graduate, 15% Diploma
and 9% of the respondents Professional course .Hence, It is inferred that the maximum percentage of
Under Graduate holders do not want to use Internet Banking.
Table 5.5 Respondents Occupation
Non-users of Internet Banking
Occupation
Frequency
Percentage
Private Organization
115
49
Government
62
27
Business
25
11
House Wife
31
13
Total
233
100
(Source: Primary Data)

Figure 5.5 Respondents Occupation

From the above table, it is observed that 49% of the respondents are working in Private
Organization, followed by 27% in Government Organization, 13% House wives and 11% doing
Business. It is inferred that the maximum percentage of Private Organization employees hesitate to
adopted Internet Banking.
Table 5.6 Respondents Annual Income
Non-users of Internet Banking
Annual income
(in Rs.)
Frequency
Percentage
Up to 100000
49
21
100001-300000
103
44
300001-500000
44
19
Above 500000
37
16
Total
233
100
(Source: Primary Data)
66

International Journal of Management (IJM), ISSN 0976 6502(Print), ISSN 0976 - 6510(Online),
Volume 5, Issue 11, November (2014), pp. 61- 69 IAEME

Figure 5.6: Respondents Annual Income

From the above table, it is observed that 44% of the respondents belong to the annual income
category of Rs.100000 300000, followed by 21% of up to Rs.100000 and 19 % of Rs. 300001
500000 and 16% of above Rs.500000. It is observed that the maximum percentage of respondents
(44%) belong to the annual income category of Rs.100000 300000 averse to adopt Internet
Banking.
FINDINGS
It is found that more number of males do not prefer Internet Banking. It shows that males also
not interested to adopt new technologies quickly. They are also not ready to take risk. They do not
have confident to face the consequences of using Internet Banking. They might not aware of Internet
Banking products and services and also its benefits. Males also may have the perception that Internet
Banking is a complex one.
It is found that more number of middle age group do not prefer Internet Banking than
youngsters and old age people. Youngsters might be having account for short span. So, they might
not be interested to use Internet Banking. Old age people might have used the traditional banking for
quite a long time. It might be convenient to them and also they may not be interested to take risk.
Hence, old age people do not prefer Internet Banking.
It is found that more number of married respondents do not prefer Internet Banking than
Bachelor/Spinster Married people might be influenced by their spouse and family members.
It is observed that the respondents who qualified Under Graduate hesitate to use Internet
Banking. Those who are educationally qualified also may not aware of the Internet Banking products
and services. They have to be made to understand its benefits.
It is found that the respondents those who work in Private Organization averse to use Internet
Banking.
It is found that the respondents belong to average annual income group disinclined to use
Internet Banking. It shows that there may not be a need to use Internet Banking when their annual
income is in average category.

67

International Journal of Management (IJM), ISSN 0976 6502(Print), ISSN 0976 - 6510(Online),
Volume 5, Issue 11, November (2014), pp. 61- 69 IAEME

SUGGESTIONS
Awareness on Internet Banking products, services and its benefits to be created among both
genders. They have to be educated that there is no complexity in using Internet Banking and also
there is no risk. Their self-confidence to be developed in a such a way that they can able to face the
consequences of using Internet Banking. Both the youngsters and old age people are to be made to
understand the benefits and convenience of using Internet Banking. Family members and spouse of
the respondents are also to be made to understand the benefits of using Internet Banking.
The respondents have to be educated about the products, services and its benefits irrespective
of their educational qualifications. Also, they have to be educated about the possibilities of
shortcoming and how to solve the shortcomings. The benefits of Internet Banking to be educated to
the respondents irrespective of the annual income.
CONCLUSION
This study provides information about the demographical characteristics of the respondents
who do not prefer Internet Banking. The bank may be able to influence their Savings Bank account
holders to use Internet Bank if they implement the suggestions provided in this study. This will help
the bank to lure more customers. The bank will be able to compete and survive in the todays
competitive environment.
LIMITATIONS OF THE STUDY

The study is restricted to the respondents of the Chennai Metropolitan city only.
The data collected from the sample is highly contextual to factors such as place and time of
data collection, mood and time available to the respondents, hence possibilities exist to get
diverse results as and when the context may vary.

REFERENCE
Journal Papers
[1]
[2]
[3]
[4]

[5]

[6]

[7]

Block, C., and Roering, K. J.(1976), Essentials of consumer behaviour: based on Engel,
Kollat, and Blackwells consumer behavior, The Dryden Press, Hinsdale.
Daniel, E. (1999), Provision of electronic banking in the UK and the Republic of Ireland,
The International Journal of Bank marketing, 17(2), pp.72-82.
Giannakoudi, S. (1999), Internet banking: the digital voyage of banking and money in
Cyberspace, Information and Communication Technology Law, 8 (3), pp.205-43.
Karjaluoto, H., Mattila, M., and Pento, T. (2002), Factors underlying attitude formation
towards online Internet banking in Finland, International Journal of Bank Marketing, 20(6),
261-272.
Murillo, R. H., and Roisman, D. (2004), Point and Click, or Mortar and Brick? A look at
Internet banking in the Eighth District, Article provided by Federal Reserve Bank of St.
Louis in its journal: The Regional Economist, October, 2004.
Pikkarainen, T., Pikkarainen, K., Karjaluoto, H., and Pahnila, S. (2004), Consumer
acceptance of online banking: An extension of the technology acceptance model, Internet
Research, 14(3), 224-235.
Sakkthivel, A. M. (2006), Impact of Demographics on the Consumption of Different Services
Online India, Journal of Internet Banking and Commerce, 11(3).
68

International Journal of Management (IJM), ISSN 0976 6502(Print), ISSN 0976 - 6510(Online),
Volume 5, Issue 11, November (2014), pp. 61- 69 IAEME

[8]

Sathye, M. (1999), Adoption of Internet Banking by Australian consumers: an empirical

investigation, The International Journal of Bank Marketing, 17(7), pp.324-334.
[9] Adnan M. Al-Khatib, Internet Banking and Its Adoption in the Arab World, International
Journal of Information Technology and Management Information Systems (IJITMIS),
Volume 4, Issue 3, 2013, pp. 12 - 24, ISSN Print: 0976 6405, ISSN Online: 0976 6413.
[10] P.Saravanan, Dr.V.M.Shenbagaraman, Dr.K.Mohan and Dr. R.Wranton Perez, A Study on
the Voice of Customers with Specific Reference To Bath Soap Users In Chennai, Tamilnadu
International Journal of Management (IJM), Volume 3, Issue 1, 2012, pp. 214 - 224,
ISSN Print: 0976-6502, ISSN Online: 0976-6510.
Proceedings Papers
[11] Lewis, R.C. (1981),Marketing for full services restaurant an analysis of demographic and
benefit segmentation. Marketing of Service, Proceedings Series, Chicago, III: American
Marketing Association.
Books
[12] Donald R Cooper, Pamela S Schindler, Business Research Methods, Tata McGraw-Hil
Publishing Company Limited, New Delhi, 2006.
[13] Efraim Turban, Jac Lee, David King, H.Michael Chung, Electronic Commerce, Pearson
Education Asia, 2001.
[14] James A OBrien, Management Information Systems, Tata Mc-Graw Hill Publishing Co.
Ltd., New Delhi, 2012.
[15] Kenneth C. Laudon , E-Commerce, Pearson Education; New Delhi, 2009.
[16] Kotler, P.(1982), Marketing for non-profit organizations, 2nd Edition, N.J: Prentice-Hall
Inc: Englewood Cliffs.
[17] Kothari C.R., Research Methodology: Methods and Techniques, New Age International (P)
Limited, New Delhi, 2004.
Website References
[18]
[19]
[20]
[21]

www.financeindia.org/fi.htm.
http://www.indian-bank.com.
http://iba.org.in.
http://www.rbi.org.in.

69