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Contents 1. Introduction 1.1. The State Bank of India 1.2. Internet Banking 1.3. Motivation of the research 1.4. Objective of the Study 1.5. Problem Definition 2. Literature Review 2.1. Background of Internet Banking 2.2. Ecommerce and Internet Banking in Asian Countries 2.3. Advantages of Internet Banking 2.4. What is Internet Banking Service 2.5. Ecommerce and Internet Banking in India 2.5.1. Evolution of Internet Banking in India 2.5.2. Internet for the Ordinary Citizen India 2.6. Customers- How do they perceive Internet Banking? 3. Research Methodology 3.1. Introduction 3.2. Research Methodology and Research Process 3.3 Philosophical Approach to Research 3.4 Research Strategies 3.5 Methods 3.5.1 Qualitative or Quantitative Approach?? 3.5.2 Primary data 3.5.3 Secondary Data 3.6. Research Suitability 3.6.1. Researchs Suitability 3.6.2. Suitability for Researchers position for research 3.6.3. Originality
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4. Findings and Discussion 4.1. Process of Interview 4.2. Questions Bank Managers 4.3. Questions IT personnel 4.4. Questionnaire 5. Analysis and Discussion 5.1. Discussion 5.2. SWOT Analysis 6. Recommendations 7. Conclusion 8. Reflection 8.1. The MBA Decision 8.2 Dissertation: A real time project 8.3 Change and Improvement 8.4. Future Prospects 9. References and Bibliography 10. Appendices 10.1. Kolbs Learning Cycle 10.2. Information Sheet for Research Participants 10.3. Questionnaire 10.4. Asian Internet Usage

34 34 35 41 45 56 56 61 63 68 70 70 72 73 73 75 82 82 83 84 89

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1. INTRODUCTION
In the recent times, the use of internet for business purpose has grown tremendously. It has shown direct effect on many industries around the globe. The advances in information and communication technologies have had an insightful effect on the banking industry across borders. The new technology of internet was introduced through the US Defence Academys ARPANET project. These technological breakthroughs has radically changed the way world interacts and conducts. Such a phenomenon has created a truly global market place. But the penetration of internet banking is more prominent in the well developed western countries, while it still has to be embraced by many other small public sector banks serving in small cities and town across the globe. A growing phenomenon in financial services is the use of the internet as a channel for financial services. The internet bank usage might however not be easy for the consumers. Consumers' use of internet banking requires acceptance of the technology, which can be complicated because it involves the changing of behavioural patterns (Meuter et al., 2000). The financial institutions are using the internet for information presentation, two-way communication and interaction with users, in addition to traditional transaction banking (Dial, 1995). The slow adoption of technology is mainly due to poor infrastructure, education and economies, also cultural factors play a very important role for the same. The Asian continent consists of many developing countries where culture and religion strongly influence the business and social behaviour in which they operate. This thesis reports the conduct and the findings into the adoption of internet banking in Indian Public Banks. Thus studying the factors it proposes a framework composed of a variety of factors that are likely to be involved. Meticulously it investigates customer perceptions of the usefulness and the ease of use of current Internet based information technology, as adopted by the Indian Banks. However, according to the World Bank it is globalization that is expected to most, reflect the progressive interaction of the World Economics (World Bank, 2000). Thus it is necessary to understand the competitive and rapidly changing environment of Internet Banking. The internet banking sector is subjected to both internal and external forces. The four external forces: Technological Environment. Political Environment.

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Economic Environment. Social Environment. (Nellis, 1998; Jayawardhena and Foley, 2000)

1.1. The State Bank of India The only Indian Bank to find a place in the Fortune Global 500 List thrice is the colossal Indian Bank, State Bank of India. It debuted in the Fortune Global 500 at 498 in 2006. In 2007 it moved up to 495 and surging upwards in 2008 to 380 according to the recent Fortune Global 500, 2008. The State Bank of India is Indias largest commercial bank. It is a government controlled bank which maintains a stake of nearly 60% through the central reserve Bank of India. Established in 1806 as Bank of Bengal, it remains the oldest commercial bank in the Indian Subcontinent and also the most successful one providing various domestic, international and NRI products and services, through its vast network in India and overseas. With an asset base of $126 billion and its reach, it is a regional banking behemoth. The forerunners of the modern State Bank of India are the Bank of Bengal, Bank of Madras and Bank of Bombay which finally merged together into the Imperial Bank of India. The Indian Independence led to realization of upbringing the rural areas and catering to their banking needs. The private banks during the period only catered to the urban banking needs and wants. Thus there was a need for a state owned bank to serve the rural population of India, irrespective of the profits. In lieu with this an act was passed in May 1955 and on 1st July 1955, State Bank of India came into being by the merger of Imperial bank of India along with other state owned and state associated banks. Since then the bank has been a premier in terms of balance sheet size, number of branches, market capitalization and profits. The bank is entering into many new businesses with strategic tie ups Pension Funds, General Insurance, Custodial Services, Private Equity, Mobile Banking, Point of Sale Merchant Acquisition, Advisory Services, structured products etc each one of these initiatives having a huge potential for growth. The Bank is forging ahead with cutting edge technology and innovative new banking models, to expand its Rural Banking base, looking at the vast untapped potential in the hinterland and proposes to cover 100,000 villages in the next two years.

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SBI offers personal and corporate banking, agricultural/rural banking, NRI banking, international banking and government business services. It offers services such as Personal Banking, Corporate Banking, Agricultural and Rural Banking, NRI Services, International Banking and Government Business. State Bank of India has 7 associate banks viz. State Bank of Bikaner & Jaipur, Hyderabad, Indore, Mysore, Patiala, Saurashtra and Travancore. These banks earlier belonged to the princely states of India. The government integrated these banks with the State Bank of India to expand its rural outreach. All the 7 banks use the same SBI logo of blue keyhole. SBI has more than 5600 ATMs across the country. SBIs foreign offices focus on India related business and are located in Australia, Bahrain, Bangladesh, Belgium, Dubai, France, Germany, Hong Kong, Israel, Japan, China, Maldives, Singapore, South Africa, Sri Lanka, Oman, The Bahamas, UK and US. SBIs wholly owned subsidiaries and joint ventures include: Nepal State Bank Limited SBI Mauritius Indian Ocean International Bank (Mauritius) SBI Canada SBI California

1.2. Internet Banking www.onlinesbi.com is the Internet banking service of the State Bank of India. India's Premier Commercial Bank. Smart products for the smart customer. This on-line channel enables customers to access their account information and initiate transactions on 24x7, boundary less basis. 3308 branches are extending INB service to their customers. All functionalities other than Cash and Clearing have been extended to individual retail customers. A separate Internet Banking Module for Corporate customers has been launched and available at 1070 branches. Bulk upload of data for Corporate, Inter-branch funds transfer for Retail customers, Online payment of Customs duty and Govt. tax, Electronic Bill Payment, SMS Alerts, E-Poll, IIT GATE Fee Off-line Customer Registration Process and Railway Ticket Booking are the new features deployed.

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The CNN IBN, Network 18 recognized this momentous transformation journey, the State Bank of India is undertaking, and has awarded the prestigious Indian of the Year Business, to its Chairman, Mr. O. P. Bhatt in January 2008. 1.3. Motivation for Research The motivations for the Research are as follows: 1. This is kind of a new offering brought forth by the multinational banks and completely alien for the nationalized public sector to taken on this technological development. Internet banking is a worthwhile topic to study so that the quality of services in the Indian Banking Sector can be enhanced in future. 2. Internet banking is widely studied by developed countries. In India apart from the multinational banks, we do nurture our nationalised public sector banks wherein such technological development as not been yet investigated. 3. The Indian Government encourages such studies, as it could lead to better quality of services and acceptance of technology. 4. Accessibility of data in India is easy, especially for organizations that would like to adopt this service in future. 1.4. Objective of the study The studies aim is to achieve the following objective: 1. Investigate the adoption and use of the Internet for banking transactions by individuals and organizations in India taking into consideration State Bank of India. 2. Identify the perceived problems that individuals and State Bank of India encountered while adopting and using these new technologies. 3. Outline strategies which propose opportunities for individuals and organizations to uncover unseen problems, thereby improving the use and acceptance of internet banking. 1.5. Problem Definition It is well-known that the Indians work is based on values and culture and they pose high ratio of resistance to change. Many nationalised Indian Banks are managed by their old employees who have been with the organization from the beginning. This acts as a hindrance

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in adopting and accepting any new technology. Studies have been carried out, but none could provide solutions to the problems of acceptance. Various causes and the impacts and strategies will be investigated in order to find out possible solutions to making this service more efficient and active in India. India is considered to be an important commercial and economic hub of the third world. With its growing economy and increasing foreign exchange, it is the most sought out for nation in the todays economical world. Each and every company wants a piece in Indias economy and are expanding rapidly and penetrating the market like never before. Indian government has encouraged investments in the country so that adoption of new technology will modernize the service industries (banks, e-commerce, e-shopping, e-government, organizations, institutions etc). All these services require a strong banking system to operate efficiently and effectively, this cannot be achieved without adopting new technology. Competition among the national and international banks in India is driving the acceptance of Internet Banking.

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2. LITERATURE REVIEW
To identify and describe the adoption issues that exist in Indian Banks regarding Internet Banking, I have read many articles like; diffusion model by (Rogers, 1983), analyzed consumers attitudes towards direct banking (Lockett and Littler, 1997). The main advantage that I found in these researches regarding internet banking it that its availability 24 hours a day and 7 days a week. The main disadvantages associated with direct banking, however, included its complexity and the security risks involved in using it. It contains some

unstructured interviews concerning some current practices and intentions of Indian Banks in regards with adoption of information technology systems and techniques. The results of this exploratory study are used to confirm the choice of approach to the main study. In December 2005 the global internet access exceeded the 1000 million mark; this was one of the most important milestones in the internet revolution (IWS, 2006). There has been a turnaround in the traditional banking practice because of the explosive growth of internet banking seen in many countries. The main aim in offering internet banking services is to expand share of customer also traditional financial institutions seek to lower operational costs, improve consumer banking services and retain and build new relations. According to ABA (2004) and Fox (2005), internet based strategy is more effective than the traditional banking as according to the reports it is more profitable, loyal and produces committed consumers. Thus many banks are now understanding the virtues of Internet Banking and are treating it evenly important to traditional channels of branches, automated teller machines (ATM), telephone banking and call centres (Gartner 2003a). According to Black et al., (2002), In the new banking environment, internet banking is increasingly managed as an operational activity and an important component of a multi-channel strategy. 2.1. Background of Internet Banking Internet banking is a cause of concern to majority of the offline banks who should be ready for an unprecedented competition from the non-traditional banking institutions that offer banking and financial services over the Internet (Rajgopalan, 2001). Although some of the traditional banks have started offering their services on line, it is only an extension of their offline services (Devi, 2001). Internet banking has now started motivating customers to park their funds with the online banks, which has a substantially impact on the deposit base of the brick and mortar banks.

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India is known for its rich cultural heritage which has been growing since centuries. India is slowly moving ahead in gaining a super-power status in the age of knowledge uprising, though it missed out on the industrial revolution. Gradually, the succeeding governments post-independence have aimed at driving India successfully in the area of Information, communication and Technology (ICT) (Nikam. K., Ganesh.A.C., and Tamizhchelvan. M., 2004). Even though there is a boost in technological industries in India. It still lacks behind in using the most prominent technology internet for its banking services. But the banking system are upgrading and bringing new technologies such as new electronic and internet banking systems for customers to use thus making banking more convenient. The reluctance to embrace E-Commerce is a particularly important issue for the Indian banking sector. Historically, every bank product was distributed through just one delivery channel the branch. In the future, banks will be freed of the constraints of a single delivery channel. They will be able to create, package, market and deliver products for niche segments and, because of the price of the new technology is tumbling, they will be able to do so costeffectively (Gates, 1999). Although there is plenty of literature on adoption of new technology, only a handful of studies look specifically at the financial services industry. There is a general recognition of the particular importance of financial innovation (e.g. Silber, 1975; Van Horne, 1985; Miller, 1986, 1992; Faulhaber and Baumol, 1988; Campbell, 1988; Siegel, 1990; Finnerty, 1992; Merton, 1992). Seitz and Stickel (1999) considered that financial service companies are using the Internet as a new distribution channel. The goals are: Complex products may be offered in an equivalent quality with lower costs to more potential customers There may be contacts from each place of earth at any time of day and night. In relation to online banking, Chou and Chou (2000) have listed some five basic services: 1. Viewing account balances and transaction histories.

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2. Paying Bills 3. Transferring funds between accounts. 4. Requesting credit card advances. 5. Ordering cheques. Joseph et al. (1999) investigated the influence of internet on the delivery of banking services. They found six underlying dimensions of e-banking services quality such as convenience and accuracy, feedback and complaint management, efficiency and queue management, accessibility and customization. In a recent study of Internet Banking, Jayawardhena and Foley (2000) demonstrated that time; price control and economic issues are among the main aspects that the customers see important in Internet Banking. Thus indicating that the customers are getting busier as the world progresses and hence, seeking to carry out their banking transactions at times more convenient for them. In theory, consumer attitudes seem to have an impact on the adoption on internet banking. In a study done by Sathye (1999) it emphasised on several factors that have had an impact on the adoption of Internet banking in Australia. One the one hand, consumers seems to be unaware of the services and benefits that Internet Banking offers. The biggest hindrance for Internet banking is the safekeeping and safety measures. Consumers tend to have security and safety concerns about transactions via the Internet. Additionally during the course of the study conducted in 1999, internet banking was considered hard to use among Australian consumers. A majority of Australian consumers perceived Internet Banking as not reasonably priced; i.e., using it is considered expensive. On the other hand, Sathye (1999) points out that fundamental barrier to adoption exist (no computer/ internet access, resistance to change). In conclusion, security concerns and lack of awareness were found to be the most prominent factors against adoption on Internet Banking in Australia. New technology sometimes requires complex understanding and mental capability, and thus the technology may be difficult to manipulate due to limited capability of firms employees. Finally technology readiness of the firm plays an important role in their attitudes towards technology. Technology readiness is conceptualized as a combination of positive and negative feelings towards technology, roughly peoples confidence that technology helps in improving their lives. (Chircu and Kauffman 2002).

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The development of Internet Banking depends strongly on the number of consumers acquiring and retaining internet access (Kingsley and Anderson, 1998). Fisher (2000), for instance says that each individuals attitude toward technology itself significantly impacts adoption. Resistance to change and lack of awareness are the main hindrances in adoption of Internet Banking in India. Thus banks should pay attention to consumer perceptions and reactions, and try to educate and inform their customers. Customers and banks are concerned about Technical/Technological issues for commercial usage of the Internet. Zugelder (2000) mentioned that customer perception is the major technical issue associated with the Internet. Among other things, customer protection issues can cover unfair and deceptive trade practices by suppliers, unauthorized access and usage by others, such as hackers, or system failures. Customer protection is important for building online customer confidence as there is no face-to-face contact, and there is great possibility (at least in customer perception) for having problems or making mistakes via the Web. An extensive study conducted in 2001 by the Consumer Bankers Association indicates that Internet banking usage remained stagnant from 1996 to 1998, with less than 10% of the market utilizing the service. This characterizes the early adoption phase where the banking industry, in its striking transformation, has embarked on an era of anytime, anywhere banking. In fact, earlier researchers (Reil et al., 2001; Long & McMellon, 2004) point out that automated service is still at its infancy stage and there is no generally accepted theoretical conceptualization of automated service quality. Cost-effectiveness in delivery of services directly implies comparatively high consumer satisfaction and a consequent change in the revenue model for the banks. Adoption of the Internet mode of banking would result in increased consumer awareness, attracts the entry of global majors in the market and would lead to the emergence of open standards in the banking industry (Treasury Management, 2001). The integration of the banking services with e-commerce and emergence of e-cash would positively affect the efficiency scores of the banks (Scott, 1999). Bruhn (1997) says that the typical Internet user wants to be respected as a communication partner, and wants his/her information needs to be satisfied individually, no matter who initiated the communication process. Financial service providers should offer

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more than just relevant information to become an often-visited portal. Before responding to any Internet offer, customers should work through an intense search process in order to acquire information about the product and services, and compare offers; so that incomplete, difficult to understand, or difficult to find information does not annoy the customer and cause unwillingness to proceed and complete transactions (Locarek-Junge and Schwaiger, 1998). 2.2. E-Commerce and Internet Banking in Asian countries Even though the internet boom has reached every nook and corner of the world, internet banking is still at preliminary stage even in the developed countries. All the virtues of Internet banking technologies and systems are yet to be exploited. Although the acceleration in its adoption has been enormous owing to which there are many banks offer many of their services only through internet. In a study done by Smith (1999), it was discovered that, even in the West, adoption and acceptance of internet banking was slow and only growing by about 2% yearly. Ray (2001) mentioned that only 1.1% of shopping takes place online. However in not too distant future, it is expected that every major bank will offer this service through the internet in one way or the other, with an increase in the quality of service and performance. From the Asianmarket experience, it is clear that Internet banking is here to stay and will be a major channel to acquire and service customers. Internet usage and Internet banking is expected to grow to more than 45.4 million by 2006 in the Asia Pacific region (Jaffe, 2003). Malaysias Prime Minister, Mahathir Mohammed, once said: It can be no accident that there is today no wealthy developed country that is information poor, and no information rich country that is poor and underdeveloped (Nagy, 1991, p. 57). This statement emphasises the importance of the Internet for developing countries. From an international perspective access to and use of the Internet is unbalanced; there are obvious gaps between developed and developing countries in terms of the numbers of nets, hosts and users. The western world consumers are increasingly taking advantage of the online services; such phenomenon has been regularly studied by various researchers. The
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willingness of consumers to adopt internet banking usually depends on how internet aware they are. Shacklett (2001), for example, describes how at Motorolas Employee Credit Union, 33% of members use the institutions online services, whereas in most credit unions, 10% to 12% of members use online banking. This was put down as aggressive marketing of their home banking scheme, based on the premise that most of their users are tech-savvy. The increased adoption for their online banking scheme was attributed to the following: Promotional inserts those are included with the members monthly statements. Low-cost Personal Computer Loan Promotions. Free Internet and home banking classes. Technology centres within branches, where the home banking product is demonstrated. There is one general perception across all countries against usage of internet banking is the issue about security. Even in developed countries, many people are worried that their card details will be hacked and misused and are concerned about online fraud, i.e., online websites that offer imaginary services or items. While encryption technology and security certification should reassure many potential buyers, most are not aware of it, or how it impacts them. Although the Internet is revolutionizing the way in which companies offer their products and services, studies relating to customer acceptance of this technology are limited (Meuter, Ostrum, Roundtree, & Bitner, 2000).

Many strategies have been developed and employed to promote online ventures, such as demonstrations of how time and money could be saved by adopting the new technology. One bank in Cleveland determined that inconvenience was sporting as a hindrance for the people against online banking (Anonymous, 2001a, pg 8). To counter that perception, the bank mailed out 118,000 bags of popcorn to its current account customers. The popcorn was accompanied by a relevant message: In the time it takes you to pop this corn, you have established online account. The campaign was designed to show how easy it was to set up customer access online. In its survey of new online accounts, the number of customers citing, direct mail as the mechanism, that brought online banking to their attention increased from 4-6 percent to 10-12 percent. Research at the bank showed that the number of customers coming online was around 3%.
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The position of any local or multinational bank is only justified as long as the banks provided efficient and effective delivery systems to their customers and meet their local and national needs. Owing to the widespread use and adoption on Internet, the financial institutions also are looking forward to provide their products and services over the Internet. Therefore it is pertinent to explore the advantages that would accrue to banks in utilising the Internet for the delivery of products, services and other uses. (Jayawardhena and Foley, 2000). 2.3. Advantages of Internet Banking According to Jayawardhena and Foley, the main advantages of Internet Banking in relation to the banks, Cost Savings It has been proved that the Internet delivery systems are much cheaper than the physical channels used by the banks. A simple transaction cost for a non-cash payment at a branch is likely to cost the bank as much as 11 times more than over the Internet. As with all forecasts and estimates related to the Internet, different authors provide disparate accounts of the magnitude of savings. This estimate is based on studies by Downes and Mui (1998), Wylie (1999) and The Economist (1999). The cost savings come about through the combined effects of reduction and better utilisation of the workforce, equipment, more economic usage of space and operational savings. Increased Customer Base Attracting new customers and retaining the loyal customers is one of the main purposes of developing new products and services (Read, 1998). Present Internet demographics suggest that it is the relatively well off and the well educated that use the Internet, which suggests that potential users are high net worth customers. Banks unable to respond to requests for new services risk losing existing customers to competitors. The use of multiple distribution channels can increase effective market coverage by enabling different products to be targeted at different demographic segments. Also it is very well evident that the customers place their trust on proven innovators. Therefore, every bank should encourage innovative ideas. Thus making it

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easier to market financial services, attract more customers, and retain existing customers. Enable Mass Communication Customization is an important forte in relation to Internet Banking. The Internet Delivery system has the capability to customize information to suit the needs and likes of each user (Dannesnberg and Kellner, 1998). The term Mass Customization usually refers to the concept that each individual customer perceives that the service, which he/she is receiving is customized or personalized according to their needs and uses. In the world saturated with mass automation and homogenised products and services, mass customization features are becoming increasingly popular and essential. Marketing and Communication The World Wide Web has the capability to host advertisements and other marketing campaigns without facing incremental charges for prolonged exposure like those found in the traditional media (Quelch and Klein, 1996). Once a Web page is designed and hosted on a server it serves its purpose 24 hours a day as long as it is active on the server. Marketing on internet costs much less than through the traditional media, the costs are limited to the initial development and maintenance costs. In addition to it its low cost attribute, the interactive nature of the internet facilitates a system whereby a customer can be guided through a catalogue of products and services that is most suited for them depending on their socio-economic profile. The internet system is proven cheaper than the traditional mailshots send. Also, the banks have added of it being more effective since being customized. Collection of customer data can be effectively carried out with minimum effort. Achieving more operational usage from customer databases is also made easier. Enable Innovation Internet technologies have paved the way for a multitude of different banking products to be innovated (Prescott and Van Slyke, 1997; Mandeville, 1998). It also facilitates the delivery of products and services in an innovative manner to customers. Development of non-core business
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Recent changes in the regulatory framework have enabled many banks to expand their services into non-traditional banking areas (Marshall, 1998). For instance, many banks have already moved into, or are in the process of moving into, insurance and stock brokerage. Many banks have the physical and computing infrastructure in place to develop with these products and services and an Internet site can serve as an ideal shop front for these services. It is evident from the literature that banks across the world are motivated to implement ebanking to achieve either top-line or bottom-line benefits. This is achieved through increased market share due to product delivery convenience and product innovation (Jaleshgari, 1999; Orr, 1999). There are new opportunities for the banks in the form of reintermediation in the e-commerce market by identifying themselves as trust authorities to validate and stand as security between business and consumers (Kalakota & Whinston, 1997). 2.4. What is Internet Banking Service? The Internet is the framework for the ever talked about information superhighway. The biggest technological advancement since the personal computer and the primary technological force causing all corporations to rethink their business model, the Internet is a system of millions of interconnected networks that spans to the earth (Wilson, 1996). Young (1999) argues that the Internet is the most cost-efficient medium for business-to-consumer dealings. Information Technology (IT) was primarily bought into the picture in early 1960s where it was employed to mechanize the back-office of the banks. This situation has been changed by a move of Information Technology into the front office; thus began the management of information systems (Liao, 1999). Technology was deployed to extend the back-office to the front office of the branch and beyond (Llwellyn, 1995). This extension made the banking industry enter a new era, with an explosion of Information Technology applications throughout the banking service sector. Internet Banking Service is defined as a banking service that allows customers to access and perform financial transactions on their accounts from their computers with an Internet connection to the bank web-site, using web browsers software such as Netscape Navigator and Microsoft Internet Explorer (Well Fargo Bank, 2000). Late 1995s saw a upward surge in the number of customers accessing information over the Internet, the main
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reason behind the rise was that internet had become less expensive and thus was affordable by not only high-end consumers but also middle-class consumers. This created a ripple effect as the rise in online customers also raised the number of products and services exchanged over the web. The increasing population of the Internet customers and demand for payments via the Internet has had an impact on the banking services provided by many banks, forcing them to extend their banking services to customers on the Internet. Burr (1996) describes Internet connection between bank and customer in order to prepare, manage and control financial transactions. Internet banking allows customers to access their bank and personal accounts to undertake banking transactions. At an advanced level, Internet banking is called transactional online banking, because it involves provision of facilities such as accessing accounts, transfer of funds and buying financial products or services online (Sathye, 1999). Now-a-days customers are more inclined towards using new and improved technology to make their every-day life easier. Internet banking technology and systems is not being ignored by banks or their customers. But due to the security and hacking reasons, many banks across the world are unwilling to provide banking services to their customers via the internet (Brogdon, 1999). 2.5. E-Commerce and Internet Banking in India It is well-known that India has always liberally welcomed all the technological and technical developments that the West had to offer and also quite successful in developing its own. India being the seventh largest geographical area in the world, the second-most populated country adding to being such diverse it also nurtures one of the most populous democracies of the world. The E-Commerce and the Internet Banking technologies have become stronger and more powerful, owing to the numerous efforts put in by the governmental and non-governmental organizations. Liberalization has paved way in for foreign banks and multinationals to grow on Indian soil. Thus the traditional banking industry is facing challenges from the non-traditional institutions that have started offering banking and financial services over the internet. Late 1980s marked the arrival of Internet technology in India. It was initiated by the Education and Research Network formerly known as ERNET (www.ernet.in). The agency was able to launch the technology with funding from Department of Electronics (DOE) of the
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Government of India and the United Nations Development Programme (UNDP). The National Centre for Software Technology (NCST), Mumbai; the Indian Institute of Science (IISC), Bangalore; the five Indian Institute of Technologys (IITs); and the DOE were the institutions involved with the project. The National Informatics Centre (NIC)

(http://home.nic.in), commenced the second major networking initiative which consisted of a national network connecting most district headquarters in India. (Nikam. K., Ganesh.A.C., and Tamizhchelvan. M., 2004). The Government of India enacted the IT Act, 2000 (Information Technology Act). This act came into effect from the 17th of October 2000. The purpose of this act, in context of banking, was to provide legal recognition to electronic transactions and other means of Electronic Commerce. The working group set by Reserve bank of India, has been working as a watchdog on the different aspect of the Internet banking. ICICI bank was the pioneer bank to use Internet banking for some of its services, in India. ICICI bank and a lot of other Indian banks use the Internet banking system to provide online banking solution. 2.5.1. Evolution of Internet Banking In India In India the evolution of modern banking technology dates back to 1980s with the use of Advance Ledger Posting Machines (ALPM). Gradually the regulatory body Reserve Bank of India (RBI) recommended all the Public sector banks, financial institutions, NBFCs to go in for massive computerization at the branch level. Second development was TBA (Total Bank Automation) wherein both front-end and back-end operations of the within the same branch will be automated. TBA ensured total bank automation consisting of an individual database for each bank. Eventually the private sector banks also entered in. The private sector banks opted for a different model of having a single centralized database instead of having multiple databases for all their branches, which was possible due to the availability of good infrastructure. Also, 1990s brought lower costs in leased line. The DOTcom boon was expanding and new technologies were implemented. Initially there was resistance in applying the new technology as the banks were not confident enough of running the whole operation through a single data centre. But when the private sector banks began to implement consolidation into a single database, other banks followed their

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lead. The first stage of empowerment of the customers for his own transactions was the evolution of ATM delivery channel. The second stage consisted of an experiment called Suvidha conducted at Bangalore, India. This experiment demonstrated the power of technology and how the reach can be increased phenomenally at a great pace. The main power of technology is that it is able to provide services at a lower cost. The delivery channels used by the banks are mobile banking and internet banking. As India is taking giant leaps towards globalization Internet banking is the sector to be studied with great interest. The question of how attitude towards elements of existing banking service might influence the consumers decision to use internet banking has not been investigated (Devlin, 2003). Researchers on various occasions have raised many issues, which must be addressed in context of Internet banking in India. Firstly, the availability of technology and infrastructure to support the new model of banking. Secondly, the need for Internet banking itself Internet Banking or an efficient system of instantaneous banking or convenient banking. Third, an adequate mechanism to tackle the security risk and operational risk aspects (Sharma, 2001). Fourth, a proper legal framework to take care of the rights and obligation of the consumers. While most of these issues have been somewhat addressed, an important issue still remains - what existing and potential consumers feel about Internet banking and on the basis of this how an appropriate banking model can be developed in Indian context (Gupta and Islamia.J.M. 2008). 2.5.2. Internet for the Ordinary Citizen India The state-owned Videsh Sanchar Nigam Limited (VSNL) launched an internet service in August 1995 which has opened new vistas for communication. Four years later, the Government of India has opened the path for private participation by providing free licenses to 132 private internet service providers (ISPs). There is currently no restriction on the number of service providers. A recent policy move also allows ISPs to set up international gateways after the necessary security clearance. They can even buy bandwidth from foreign satellites and set up submarine cable landing stations. Licenses have in fact been issued to around 15 ISPs for setting up international gateways at 43 locations. About 506 companies applied for ISP licenses, while 150 are stated to be operational (NASSCOM, 2003, p. 161).
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Initially up to March 1999, there were about 2.8 lakh internet subscribers, by March 2000 this number rose upto 30 lakh and by end of March 2004, it had grown to 41.7 lakh. The ISP Association of India has announced a reduction in internet tariff rates and is expecting that by 2010, internet subscribers will touch the target of 4 crore (Srinivasa, 2004, p. 19). By September 1996, India had more than 100,000 Internet users, 70,000 through ERNET, 15,000 through SOFTNET; 2,000 through NICNET and 8,000 through GIAS. User numbers are expected to grow to one million in the next three years; by then computer penetration will be around 10 million PCs. The education and research community has maximum penetration with 65 per cent, followed by business users of 25 per cent and other users of 10 per cent in the government and private households. A dramatic growth is expected once private sectors enter the Internet market. The city of Bangalore is expected to dominate the internal market because of its electronic city image (Ramakrishnan, n.d.). However, Internet banking is a mixed blessing in the form of increased risk, the level of confidence reposed by the consumers and the problem of blending it with the physical system (Hawke, 2001). Internet banking has brought about a new orientation to risks like settlement risk, international technology transfer risk, crime or fraud risk, regulatory avoidance risk, taxation avoidance risk, and competition risk (Saunders, 1997). Basel II recommendation on operational risk also supports this hypothesis. In India, some banks like HDFC and ICICI have introduced payment gateways running on secure systems having firewalls against hacking (Rao, 2001). Convenience, safety and cost effectiveness are the jargons in the spectrum of online banking (Rose, 1998). In the current scenario, the banks need a transformation which can be achieved through a mindset to adopt technology, recognizing the core competencies, an initiative from the top management to convert the organization to outward looking and aligning roles and value propositions with the customer segments. The suitability of technology and a careful analysis of the needs of customers are equally important (Pires and Aisbett, 2002). Study conducted by Sangaran (2001) on Malaysia focuses on the change that is required in the attitude of bankers to adopt Internet banking. The banks have to develop a sound strategy before implementing Internet banking in order to compete in the global market place.

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As consumers get more and more educated, getting insight about modern banking, via Internet banking has evolved as primary area of concern for all leading and upcoming banks in India. (Shrivastav, 2007). 2.6. Customers- How do they perceive Internet Banking? Introduction of Internet banking has affected customers perception towards the banking services. Many studies have been carried out in India in order to learn about customers resistance to change towards the Internet. Taking in consideration the rural banking Hasanbanu(2004) studied the customer services provided in villages. It was revealed in the study that most customers are not aware of the loans that are provided. It was also exposed that banks were taking less interest in educating their rural customers about the rules and regulations of the Bank. According to a study made by Heggade (2000) on Bank customer relationship, he charted down responses from 11 different classes of Bank customers including Businessman, Salaried, advocates and peasants. The paper concluded that there is a low correlation among the different occupations and satisfaction from the services in the Public Sector Banks (PSBS). This is primarily because of the lack of education to farmers and their resistance to change in terms to learning and understanding new technology. Studies have been conducted across many cities in India in order to get an overall perspective about the Banking services. Sharma and Singh (1993) - They studied the quality of customer service provided by two banks namely Standard Chartered Bank (SCB) and Punjab National Bank (PNB) in the Branches situated in Amritsar, Punjab. They concluded saying that the SCB was outstanding in providing services rather than PCB. Singh and Malhotra (1993) they analyzed banking services in Public Sector banks in Amritsar city Punjab. They suggested that the Public Sector Banks in order to stay in the market with the upcoming private sector banks should improve their services to attract new customers and retain the old ones. Singh (2004) This study concluded that the area of the branch location of a Public Sector Bank is the main reason behind the quality of services. The level of customer

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satisfaction is usually determined by the branch location, design, variety of services, rates and changes and system and procedures. Sharma and Kaur (2004) - studied customer satisfaction in rural banks. This study is concerned with Hoshiarpur district of Punjab. They used five-point likert scale and found that the rural customers are not satisfied with the strategies adopted by Gramin Bank. Shastri (2001) He analyzed the effects and challenges of new technology for banks. Technology has brought a sea change in the functioning of banks. The earlier manual system of preparation of vouchers is slowly being automated thereby saving a lot of time and effort; the use of Automated Teller Machines (ATMs) and introduction of IT are more than in the past, especially in the post-VRS (Voluntary Retirement Scheme) scenario. Uppal (2006)- the author with stratified sampling of 500 bank customers, explained the impact of computerization on the satisfaction of customers of all bank groups and concluded that customer services are quite better in fully computerized banks and further in e-banks in partial and noncomputerized banks. But the study is only concerned with the urban sector of Punjab. Husain (1988) highlighted the importance of IT in various sectors. In the introduction of any new technology or system, various organizational, financial and functional problems are faced. People are generally reluctant to accept new system, howsoever beneficial it may be. Such problems related to computerization have been critically and vividly discussed.

SBI has also faced such resistance to change not only from customers but also from some managers. This thesis is an attempt made to understand the problems encountered by the consumers and employees of State Bank of India. From the above review it can be concluded that the Internet Banking has been a big boon to the banking industry and has completely transformed the service delivery system of the bank. But from the review it can be seen that not a single study is related to Banking Transformation In State Bank of India through e-delivery channels. Thus this study is an attempt to study about the Internet Banking In State Bank of India.
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3. RESEARCH METHODOLGY
3.1. Introduction This chapter provides a detailed description of the research design and methodology used in this study. The purpose of this study is primarily to gain a deeper understanding of the new role of internet banking, in developing countries like India; it specifically studies the role of the premier bank in India i.e., The State Bank of India, in its endeavour in adopting and using the Internet Banking technology. There are several factors that influence consumers of Internet Banking websites, and enhance customer service in Internet Banking. This research investigates the adoption of Internet Banking in India; specifically it studies the State Bank of India. It aims to develop a framework of the variety of factors that are likely to be involved in its acceptance by users. Consideration of the research design takes into account the different demands of collecting, analyzing and interpreting data under these circumstances. Following a general discussion is possible research methodology; this chapter justifies the decision to adopt a mixed method approach for the study, which includes the collection and analysis of both qualitative and quantitative data. One aim of this study is to investigate the appropriateness of mixed methods for this type of research, particularly the use of triangulation, as shown in 3.1; in order to permit a combination of qualitative and quantitative methods for the research, following the lead of others in sociology, especially in sociological life course research (Maxwell, 1998; Flick, 1992; 1998; Fielding G. and Fielding L., 1986; Denzin, 1978; Campbell and Fiske, 1959). This chapter discuss the research paradigm and associated concepts used in the study before presenting an overview of the mixed methodology approach used. The chapter then goes into detail about the data collection methods including the semi-structured interview and survey techniques, which are used in the study. A concurrent research approach (Figure 3.1) was used to confirm and corroborate the findings from each approach. Further, stepwise multiple regressions were used to determine the best model of Internet Banking utilization in State Bank of India and in India.

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Figure 3.1: the structure of the Mixed Approach for this Research
Qualitative Methods

Quantitative Methods

Data Collection Structured and Semi structured Interviews

Data Collection Survey Questionnaire

Data Analysis QSRNvivo Software

Data Analysis SPSS

Integration of Results.

3.2. Research Methodology and Research Process The most common principle or philosophy is Research Methodology, which directs researchers to carry out the research. Various issues such as constrictions, problems and ethical preferences are included with the research (Catherine, 2002). Ordinarily, research methodology is different to the research methods. According to Strauss and Corbin, research methodology is the approach of thinking about and studying social reality; whereas methods are set of practices and procedures for gathering and analyzing the data (Strauss and Corbin, 1998). Research methods are the procedures to gather primary or secondary data through questionnaire, interviews or focus groups (Catherine, 2002). Methodology is an approach to a problem that is developed in a research programme. The most significant and initial requirement in order to carry out a superior research is understanding of the research process. It basically included the entire process of collecting of data to test and analyse them by
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comprehending the research problems, generating research hypotheses and theoretical assumptions to carry on the research (Remenyi and Williams, 1995). Saunders et al (2006) argues than methodology is the theoretical analysis of the methods that are appropriate to a particular field of study or to the structure of methods and philosophy to a specific division of the knowledge. Therefore, it could be objections to the methodology of a geographic survey, i.e. uncertainty related with the suitability of the methods used or of the methodology of modern cognitive psychology, i.e. the principles and practices that underlie research in the field (Creswell, 2003). However, contemporarily, in scientific and technical contexts, methodology has been widely used as an ostentatious substitute for methods (Papazoglou, 2006). Methodology has been used very ordinarily in casual sense, but misusing of methodology has made it extremely difficult to do an important conceptual distinction between the implementation of scientific investigation (appropriately methods) and the philosophy that resolves how these tools are organized and deduced (Krippendorff, 2004). Saunders et al (2003) has suggested the onion theory which articulates that research process includes five levels: Research Philosophy, Research Approaches, Research Strategies, Time Horizon and Data Collection Methods. The researcher has undertaken many exercises and has adapted the concepts from the above theory which are explained in the following part, and believes it would be helpful for him to carry out the research.

Diagram 3.1.1 Onion Theory, Adapted from Saunders et al (2003)

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3.3 Philosophical Approach to Research Saunders et al (2003) states that there are three views that dominate the literature: positivism, interpretivism and realism and believe that all of them play equal important part in business and management research. Positivism is defined as an observation of social reality whose end product of the research is generalised like physical and natural scientists (Remenyi and Williams, 1998). The researcher is independent and is not affected by the subject matter of the research. Positivism is the external reality and its knowledge is based on observations of this reality (Easterby-Smith et al., 2002). Interpretivism, on the other hand, is contemporary issue as the social world of business and management is very complex to provide it by explicit laws in the way of physical sciences (Saunders et al, 2003). If research philosophy is related to the above concept it is very much inclined towards an Interpretivist approach. Remenyi and Williams (1998) strongly argues that it is necessary to discover the particulars of the condition to understand the authenticity or perhaps a reality working following them. Realism, as been explained, is a belief that reality exists that is independent of human thoughts and beliefs (Saunders et al, 2003). Therefore, realism has many philosophical traits of positivism as it is also related to external macro aspects of society. The researcher believes that there is no one approach that is better than the other. It basically depends on the research and its questions; it could be a mixture of both positivism and interpretivism. Before going to the conclusion, whether the researcher is a Positivist or Interpretivist, he wants to look forward to the research approaches. Generally, researchers use two main types of research approaches i.e. deductive and inductive approach (Saunders et al, 2003; Sekaran, 2003). The deductive approach is when a researcher conducts a theory of hypothesis and after that develops a research strategy to test it (Saunders et al, 2003). These theories are then deduced from general assumptions (Collins and Hussey, 2003). The data collected for research is mainly quantitative in nature for e.g. surveys, questionnaires etc (Eden et al, 1996). The hypothesis is first deduced, expressed in operational terms, tested and examined to get the outcome of the research. If necessary, theory is modified in the light of findings (Robson, 1993). On the other hand, in inductive approach researcher collects the data initially and then develops a theory as a result of
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research analysis (Saunders et al, 2003). The data collected for research is basically qualitative for e.g. interviews (Eden et al, 1996). Before carrying out a research design, proper understanding of the topic is required to adopt a particular approach; lack of the knowledge would lead to having difficulties in between (Easterby-Smith et al., 2002). These approaches are connected to different research philosophies, the deductive approach relates more to positivism and the inductive approach relates more to interpretivism (Saunders et al, 2003). The major differences between both the approaches are shown in the Table 3.2.1 below. Major differences between deductive and inductive approaches to research Deductive approach Inductive approach

Scientific principles. Moving from theory to data. The need to explain causal relationships between variables. The collection of quantitative data. The application of controls to ensure validity of data. The operationalization of concepts to ensure clarity of definition. A highly structured approach. Researcher independence of what is being researched. The necessity to select samples of sufficient size in order to generalize conclusions.

Gaining an understanding of the meanings humans attach to events. A close understanding of the research context. The collection of qualitative data. A more flexible structure to permit changes of research emphasis as the research progresses.

A realization that the research is part of the research process. Less concern with the need to generalize.

Table 3.2.1 Main differences between deductive and inductive approaches to research, Adapted from Saunders et al, 2003.

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3.4 Research Strategies

Robson (1993) defines three traditional research strategies, i.e. real world social research, experimental surveys and case studies. In this case, the social research and experimental surveys can encounter faulty information which may not be reliable for carrying the research accurately. Yin (1994) points that a case study methodology is more appropriate as it defines experiential inquiry that explores the new and current phenomenon within reallife context. Thus, researcher believes that using the case studies would be more reliable source and research outcomes would be more accurate as it will provide multiple data and full knowledge about the company and its present and past strategies to improve or amend them for future growth and development. This will involve the use of multiple respondents within the organisation and various data collection methods from interviews and financial documents. The research is basically focused on the small number of audiences which includes the managers and other supporting staff in the organisation. According to Saunders et al (2003), the attention should be paid towards the research design: reliability and validity, because of the possibility of getting incorrect information is high. Therefore, researcher will properly use the qualitative methods i.e. interviews, case studies, and research design to get the reliable information for the quality research.

In addition to this, the research is basically established on the participants observations over a long time period and non-structured interviews which includes the ethnography method (Atkinson and Hammersely, 1994). The researcher is working in the organisation and hence ethnography method will help to get key information that can guide the researcher in carrying out his research more effectively (Prasad, 1997). In contrary to this, Wolcott (1995) says that these ethnographic methods are sometimes more stressful and sometime there is a risk that the researcher may get wedged with the details and local understandings without being able to say something systematic of wider theoretical interest. Wolcott (1995) suggests the personal interviews could be more informative than the observations or ethnographies. Therefore, critically evaluating both the points, researcher will use both the ethnography and interview methods to provide more solutions to the organisation in its research. The theoretical concepts are very important and thus can provide an initial step to start a research and raise questions concerned with the design of the research from which data can be analyzed and hypothesis are infused (Saunders et al, 2003).

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3.5 Method 3.5.1 Qualitative or Quantitative Approach?? In past years, authors are making distinction between the qualitative and quantitative research. Qualitative data is mainly related to concepts which are based on a subject in a real manner as is possible (Robson, 1993), whereas quantitative data is concerned with testing of theories and hypothesis to carry on the research (Bryman, 2004). Defining the differences between the quantitative and qualitative approach could be problematic; as neither of them is better than the other (Sekaran, 2003). Gill & Johnson (1997) even argues that sometimes both the approaches are required to carry out the research effectively. Easterby-Smith et al (2002) also supports the argument that sometimes it is difficult to segregate both the approached from each other in the research and both have to be used. To adopt the right method to a research is the kind of questions to ask and analysed (Jankowicz, 1991). The key differences between qualitative and quantitative approaches are given in the Table 3.4.1.1 Quantitative data Based on meanings derived from numbers. Collection results in numerical and standardized data. Analysis conducted through the use of diagrams and statistics. Based Qualitative data on meanings expressed

through words. Collection standarised of results data in non-

requiring

classification into categories. Analysis conducted through the use of conceptualization.

3.5.2 Primary data Primary data is the data which is gathered by the participant observation. Gill and Johnson (1997) says the researcher attempts to participate fully in the lives and activities of subjects and thus becomes a member of their group, organisation or community. This enables the researcher to share their experiences by not merely observing what is happening but also feeling it. Gill and Johnson (1997) has categorized the role of participant observer that can be adopted. The roles can be explained through the following diagram 3.4.2.1
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Diagram 3.4.2.1 Typology of participant observation researcher roles, adapted from Saunders et al (2003) For this research, the author is performing a role of Observer as participant as the author will be a spectator and not the real candidate. The author is mainly conducting qualitative semi-structured interviews which have mainly open ended questions. 3.5.2.1 Primary data collection method 1- Qualitative Interviews 3.5.2.1.1 Case selection The quantitative data was not reliable since there are not much public banks that have jumped into the hoard of internet banking. Thus it is not able to do a wider research on acceptance on internet banking done by public banks in India. There have been many private banks like ICICI, HSBC, BARCLAYS, ABN AMBRO and many more in India who have started and been successful with internet banking because of their urban expansion and literate customer base. Unfortunately, public banks were not been able to keep ahead in the globalization race. They were not given an opportunity financially and professionally to recognize and lay foundation for new banking technologies, processes and procedures in their respective banks. But quantitative data was collected using personal interviews with managers, technical staff

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of various private sector and public sector banks in Mumbai, India. Interviews were taken mainly with one private sector bank i.e., HSBC situated in Churchgate, Mumbai, India. Initial interviews were also taken with managers from The State Bank of India situated in Churchgate, Bandra and Borivali, Mumbai, India. The main focus has been the bank situated at the Borivali region of Mumbai, wherein internet banking was recently started. Thus the researcher was able to get relevant data from both the private and public sector banks. This helped the researcher to get clearer view of the impressions and experiences of the people involved or effected by the organisations operations and help him learn more about their answers to the interview questionnaires. This gave the full range and depth of information with the client. 3.5.2.1.2 Interview Preparation Arskey and Knight (1999) suggested an interview guide to the preparation of the interviews, to cover the relevant topics during the process of interview. The questions were mix of open response and fixed questions, which helped in checking response validity suggested by Kvale (1996). This also provided further clarification for the answers which were required for the research. 3.5.2.1.3 Interview conduct Interviews were conducted taking prior permission of various Banking Professionals of different banks. Mails were sent to them explaining the project and their needed assistance and permission asking to take interviews. The interviews were taken in the Managers office while on duty. These interview transcripts were further analyzed and interpreted. All interviews were run in accordance with the protocols (Appendix 2). 3.5.2.1.4 Interview Analysis All interviews were proposed to be transcribed and analyzed using Nvivo, but the research had just two interviews and Nvivo is advantageous where the research includes large focus groups. Therefore, the interviews were analyzed on the findings during the interview. 3.5.2.2 Primary data collection method 2- Focus Groups The researcher gathered the data by concentrating on the focus groups like group discussions with the Bank Managers and the Technical manager and discussed with them the operational and informastion technological weaknesses which are leading to the performance
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of internet banking in The State Bank of India. This conveyed researcher about the key information about the programs and helped in exploring the information in much range and depth in short time. 3.5.2.3 Primary data collection method 3- Personal Observation The researcher was working with the organization before in 2003-2004 at the Borivali Branch, Mumbai, India. The researcher was delighted to know, when such an old organization wanted to experiment with globalization. Thus the researcher took the decision to know about learn about their journey from the initial setup to launch of the website and its success. The researcher has used her own past knowledge and work experience which helped her in coming to some conclusions for his research. 3.5.2.4 Primary data collection method 4- Ethnography Method The researcher had done the non-structured interviews as well, with the participants observations like staff members. This also helped the researcher to basically know whether the staff members and the customers at the bank were persistent towards the new technological improvement. This was highly informative to carry out the research. 3.5.3 Secondary data Secondary data is that data which is used for some other purpose in a research project (Saunders et al, 2003). This data could be qualitative or quantitative data. The data used could be a raw data or complied data. Secondary data was complied with the help of various journals, newspapers, text books and Banking articles.

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3.6 Research Suitability 3.6.1 Researchs Suitability The researcher is a Graduate in Business Management Studies from Mumbai University. At present pursuing MBA(Masters of Business Administration) from Liverpool John Moores University. The research topic was selected by the researcher because of her knowledge in the subject area, as she pursued her graduation with Special Studies in Finance and International Finance. 3.6.2. Suitability for Researchers position for research The researcher is fascinated with the world of Banking and dissemination of services. Being studied it in various subjects and topics. It has optimized the interest in the topic. The researcher wanted to carry out this research because of the pure scale and profits derived from the markets. 3.6.3. Originality As stated in the literature review the subject area is under investigation, though many authors have stated many reviews revolving the subject area. The Internet Banking theme has been reviewed in many developed countries, but rapidly developing countries like India and China are being ignored.

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4. FIDINDGS AND DISCUSSIONS

In the following chapter, the researcher has detailed out the findings of the research from the primary and secondary research. The researcher here has a large focus group comprising of mainly of the branch employees and also the customers. These interviews provided an opportunity for greater flexibility to explore and understand the issues underpinning the quantitative findings. Qualitative data from the interviews were analyzed in order to illuminate important aspects of the adoption and use of Internet banking from the bank managers perspective. 4.1. Process of the Interview There is no widely agreed upon sample size for the number of interviews in a study Spector (1992) simply recommends a small sample. It was therefore considered adequate to conduct 5 key informant interviews. The interviews were carried out on a representative sample randomly chosen from IT experts, bank managers. Three of the interviewees were bank managers, and two IT experience in relationship Internet banking. The interviewees were sent letters of invitation (participant consent) asking them to agree to participate in this study, and informing them about the research process. All respondents read the procedures as set out in the information sheet and understood what was expected of them. The results here are both from the personal semi-structured interviews and focus group discussion between managers and the IT professionals. Questions asked to the Bank Managers and the Information Technology personals for the dissertation purpose they are being identified as Bank Managers Information Technology Personnel BM1, BM2, BM3 ITP1, ITP2

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4.2. Questions Bank Managers I. Could you tell me about Internet Banking in India? BM1 - India is considered to have the highest growth potential for internet banking because of its huge population, thus every bank wants to share from the big market. Hence all the major banks like ICICI, HDFC, IndusInd, IDBI, Citibank, Global Trust Bank (GTB), Bank of Punjab and UTI were offering Internet banking services. The banking industry in India is facing unprecedented competition from non-traditional banking institutions, which now offer banking and financial services over the Internet. Internet Banking was born due to increased attention given to improve customers experience while banking, so as to have an edge other banks. BM2 Internet banking has become the in-thing, because of the huge penetration on internet in India over the decade (Appendix. V). Also, the deregulation of the banking industry coupled with the emergence of new technologies, are enabling new competitors to enter the financial services market quickly and efficiently. Indian banks are going for the retail

banking in a big way. However, much is still to be achieved. Technology is key to servicing all customer segments offering convenience to the retail customer and operating efficiencies to corporate and government clients. BM3 Internet banking is a kind of systems that enable financial institution customers, individuals or businesses, to access accounts, transact business, or obtain information on financial products and services through the Internet. Banks are continuously seeking awareness of cutting edge practices in banking internationally and institutionalize this learning across the organization .With the growth in our economy and changing technological reforms have fueled the growth on internet banking in India. SBI and other banks are going rural which is the real growth in terms of a bank wherein they are not only expanding their customer base but also changing age old banking reforms in villages across India. Analysis It is evident that the banking sector in India has experienced a rapid transformation. There has been a constant wave of change in the banking sector owing to which the banking sector has been able to house nationalized, co-operative and in recent times even multinational banks. Such a diverse nature of players has given rise to adoption to various new methods and technologies.

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II. What lead to implementation on Internet Banking in State Bank Of India. BM1 - State Bank of India (SBI) is that country's largest commercial bank. SBI has been forced to revamp its operations since competition was introduced into the country's commercial banking system. As part of that effort, SBI has been rolling out its own network of automated teller machines, as well as developing anytime-anywhere banking services through Internet and other technologies. SBI also has taken advantage of the deregulation of the Indian banking sector to enter the, assets management, and securities brokering sectors. The security provided by Internet banking was the prominent reason to go ahead with the transformation. BM2 With multinational banks coming in the start of the century, we felt a need to revamp our services to remain competitive in the race. Internet Banking was an ideal choice to start with. Initially, SBI concentrated hugely on back office automation at the branch level. The initial beginning was passed over by the Rangarajan committee which in its 1985 report, ensured that all the banks had to get computerized. 1980s marked the initial stage when technology was first introduced in the Indian Banking Sector. The first major reason for this transformation was the improved security and encryption methods developed on Internet. The other reason was to capture potential markets and retain customers. BM3 - By the beginning of the 20th century, India's banking industry boasted a host of new arrivals, and particularly foreign banks authorized to exchange currency. The growth of the banking sector, and the development of indigenous banks, in turn created a need for a larger "bankers' bank." At the same time, the Indian government had outgrown its colonial background and now required a more centralized banking institution. These factors led to the decision to implement an Internet Banking system so as to gain the benefit to being the first mover. The main reason was to provide the customer with the power over his own transaction without the help of bank branch. Analysis The bank has always been a front runner in deploying new technologies and providing quality services as provided by the multinational banks. One of the managers rightly said that, A more sophisticated SBI with modern Technology and processes would challenge Indias leading private banks and economically expand its services to the remotest rural areas, giving the thrust to potential business.

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III. Could you shed light about the possibilities of adoption and usage of Internet Banking? And how culture can influence that? BM1 The most important factors that influence the adoption on Internet Banking are their attitudes, motives and resistance to change. I feel that innovation is the need of the hour and such improvements and developments should be made to stay ahead in the race. There has been a cut-throat competition since many foreign banks have opened in India. Such a competition urges the organizations to recognize the importance of consumers and the necessity to address their needs through innovative products supported by new technology. Resulting to this there has been prominent changes in the managerial challenges including market segmentation, product positioning, innovative delivery channels, cross-selling etc.. On the managerial front innovative and elaborate systems were evolved to manage, assess and contain risk. BM2 I truly believe that customer values towards banking are solely shaped by their habits, reinforcement effects and situational influence. The organization culture has also changed to a particular extend. Personally adoption of the Internet Banking system was a new challenge faced by me. It was something completely new to be learned and adopted. We being a public sector bank cater to customers from all walks of life. Thus Internet Banking was implemented after providing rigorous training to the Bank Managers. Our diverse customer base makes language a barrier especially for Internet Applications. Barriers in terms of language has played a huge role, as most of customers are not that efficient in English language. But with the advancement in technology we are able to change the language as the customer wants and present the website therein. BM3 - Resistance to change plays the prominent role in such a situation. It differs in each and every individual hence we can never get a pre-set result. Such resistance was seen from individuals and also from the organization itself in the beginning. But it surpassed the confrontation and the whole implementation process was a huge success for the organization and also for all those associated with it. Analysis -Most of the population even today believe in traditional banking methods of account keeping and would like to interact with a human over the counter rather than punching a few keys to transact their hard earned money. Ignorance is still evident in the customers in terms of Internet Banking and handling money over the Internet.

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IV. How do consumers perceive Internet Banking compared to traditional branch banking? BM1 - Initially even us managers didnt feel a need for internet as we were content by the way our organization worked. But with the implementation of Internet Banking the workings have paced up in speed the process. Customers usually perceive risks in conducting transactions electronically and particularly if the transactions involve money. Risk perception can be of six different types: time risk, finacial risk, performance risk, psychological risk and safety/confidentiality risk. It is generally considered that risk perception could be higher for electronic banking services. BM2- Customers initially were hesitant with the idea of introducing internet Banking, probably because of the ignorance towards computer education of the customers. But after the deployment of the Internet Banking system the customers did start to use the service. But the main point of security and piracy on the net is always the focal point of any Internet Banking related discussion. Here customers worry about their data and the account security. We do try to explain them about the secure connections and different methods adopted by us to prevent such mishaps. I have personally come across some customers to deny using Internet Banking because they say that, we are habitual to visit the Bank every Saturday. They are contented with their own banking methods hence are not open to new ways of Banking. BM3- Customers perceive the quality of services of Internet banking based on the performance of online delivery systems not on the processes in which the delivered service is developed and produced. Because customers perceive Internet banking service quality based on relatively standardized outcomes determined by online systems, customer attitudes toward that outcome reflect overall quality of services delivered. Analysis - Many people do not feel the need to use internet banking as they are very content with the way they currently source their banking services. Most consumers also consider themselves to be very active users of banking services, implying that, by becoming an internet banking user, there would be few, if any, benefits for them. This leads them to perceive the range of services offered over the internet was much narrower than the range which could be sourced in traditional ways in other words, the range of services was perceived to be limited.

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V. What is the main concern that deters the growth of Internet Banking? BM1 - Security plays an important role in Internet Banking. The security criterion affects the people awareness and understanding of online banking through internet. The customer is always concerned about the security and identity thefts. There have been many instances of data identity thefts and credit card frauds across Mumbai, people now are more alert in terms of giving information into a particular machine or software. Frauds, thefts and identity data thefts are the major concerns in the customers today. BM2 Online security continues to be a major concern to the world of online banking. I believe that there is always a need for consumer education on security. There are many security measures applied by SBI like encryption technology, security hardware and software to protect customers account information, surveillance systems and digital certificates. There are many different psychological and behavioural issues such as trust, security of Internet transactions, reluctance to change and preference of human interface. BM3 The main point is the security and privacy of the net. There is fear and worries about the online security and privacy. In my response I feel that security, availability of infrastructure and complexity of technology are the main concerns which are hindering the migration from traditional banking to Internet banking. Many other problems posed by customers are fraudulent activities taking place over the internet and slow web interface. Analysis :- The main concern that still acts as a major hindrance is the security. According to the managers customers are still always apprehensive about transacting on the internet. This is because of the frequent power cuts and unreliable internet providers. Culture here comes in perspective as bank managers believe that the India customer is not used to deal with money in such a way. Most customers believe personal contact is more important rather than online banking. SBI make efforts to increase their site usage by customers and effectively coordinate the online channel with branches and call centers. Then only they will be able to derive maximum value that includes cost reduction, cross-selling opportunities, and higher customer retention.

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VI. Could you tell me about the consumer attitudes and behaviour towards the use of Internet Banking in SBI? BM1 In the initial stage the customers were ignorant towards the use. People at the start did not feel the need to manage their money online. Consumers were generally apprehensive on using internet. There was a major discomfort level seen. discomfort was generally from the lower usage of Internet. The Internet has changed the customers' behaviors who are demanding more customized products/services at a lower price. Moreover, new competition from pure online banks has put the profitability of even established brick and mortar banks under pressure. BM2 Throughout the implementation phase Internet Banking has been a huge success. It main depends on the location. Our Branch is located here in Borivali, Mumbai, where we mainly cater to the middle class population of this suburban area. Borivali is a mixture of people from different socio economic backgrounds. We have encountered a variety of experiences right from a college goer, middle class working man to a retired pensioner. Customers have some rational reasons for staying offline. Some of these reasons include usability features of the site, concerns about security and frequent complaints that signing up is complicated and time-consuming. BM3- Customer attitudes have changed since its inception. Earlier people were apprehensive about the Internet Banking notion, but now we have seen an increase in the operations over the web. Many customers across socio-economic background are eager to learn and adopt internet banking now. Though issues such as language barriers, security and trust are still afresh in the minds. For more complicated transaction people like receiving advice, thus the independency given by internet banking is not used to its prefect potential.

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Questions put forth to the IT personal I. What role does IT play in banking? ITP1 IT is central to any organization. IT has been able to provide a phenomenal change in the Indian Banking sector since its inception. Internet is an ideal medium for the delivery of banking products and services. The advantages are enormous such as cost savings, increase in customer base, retaining customers, facilitates mass communication and enables non-core business development. Many private and multinational banks brought the wave of change of online banking. This is main reason of their survival in such a diversely populated country. The banks were able to leverage on the most important benefit of low cost by optimum utilization of their resources. Such a change did supersede the branch banking method, but SBI kept reinventing their business models to offer new financial services through its branch. Introduction of IT has made customer banking experience more convenient, efficient and effective. In a recent summit I attended on February 25th, the Executive Director of RBI (Reserve Bank of India) rightly says, Internet has enabled the banking sector to go beyond its traditional role and is now playing an increasingly important role in its key areas of operation as securitisation, risk preference and liquidity. ITP2 IT in Banking is not only restricted to providing efficient service in addition to branch banking, but as evolved as a most sought after medium of delivery because cost reduction techniques. Customer retention has become the most important priority in SBI, due to the increased competition. IT has taken banking to a new level. It has proved beneficial not only to the customer but also to the provider. IT infrastructure has changed the way banks functioned. From front-end to back-end to customer relationship management, IT has proved its mettle across diverse departments. Findings It is seen from the above records that Internet Banking has sparked a major revolution in the banking industry. The IT personal believe that Internet Banking in SBI has been a major success and they strongly consider duplicating the internet banking models in rural areas in order to expand their customer base in terms of internet banking.

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II. According to you what still remains the major concern, even after the success of internet banking? ITP1 The main challenge after the successful implementation of the Internet Banking is to maintain the banking infrastructure. Apart from setting up the infrastructure and the base, more importantly it is necessary to maintain it. Maintaining it will ensure sound working conditions and fewer hassles to the customers and the bank. Other than this, security remains the main concern. Any security mishaps would cost the bank severe losses and jeopardize its reputation as well as reduce public confidence towards Internet Banking. SBI operates at the highest level of security. We at SBI depend on SSL (Security Sockets Layer) protocol as well as 128-bit-encryption to encrypt data entering bank server and verify the bank server to the user. ITP2 The major concern I still encounter is about security and reliability. Since technology is made by human there is always a chance of error, this error can occur even if the best solutions are in place. Security of Internet Banking transactions is one of the most important areas of concerns to the regulators. Security issues include questions of adopting internationally services, standards for access control, encryption, firewalls, verification of digital signature etc. The regulator is equally responsible for the security policy of the Bank. There are certain risks that are faced by us as regulators and the Bank (SBI). 1. Regulatory Risk - The Internet Banking in SBI calls for advanced regulation and supervision as internet allows services to be provided from anywhere in the world. 2. Legal Risk- Internet Banking carries high risks in legal matters as such territory is still to be well studied and versed with. Banks can potentially expand the geographical scope of their services faster through electronic banking than through traditional banks. SBI is working hard to be vigilant in terms of new laws and legal rules thereby lowering potential risks. Regulators have started co-ordinating legislations and regulations in order to provide a safer electronic environment for the customers. 3. Operational Risk: The reliance on new technology to provide services makes security and system availability the central operational risk of electronic banking. Since security threats can come from inside and outside the system, SBI has put in place appropriate practices to guarantee the confidentiality of data, as well as the integrity of the system and the data.

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3. Was the implementation successful in technical terms? ITP 1 and ITP2 The successful implementation and development of online banking are influenced by many inter-related factors and institutions, including quality and security of internet network, the level of internet knowledge of the population, the government support as well as the internet strategy of the bank and the quality and reliability of online banking. State Bank of India was successful in carrying out the largest centralized core-banking solution ever attempted by any other bank in India. Initially over 13000 branches of State Bank of India and its associates were run using traditional manual procedures which were inherited by the Imperial Bank. Mainframes and mini-computers were used for MIS, RECONCILLATION and FUND SETTLEMENT PROCESS. After the implementation of the Internet, the bank has a come a long way. SBI currently has more than 95% of its bank branches on WAN and handled using CBS (Core Banking Solutions). Changes brought in Information Technology by SBI In the next decade internet facility was provided for individuals All SBI branches were connected and ATMS were launch 2001 - KMPG appointed consultant for preparing IT Plan for the Bank. Later on Core banking proposed by the IT consultancy company. 2002 All branches computerized but on decentralized systems, there the initiative of core banking took place 2008- more than 6500 branches (95% of business) on Core Banking Solution (CBS) Internet Banking facility for Corporate customers were also launched in early 2008 More Interfaces developed with e-Commerce & other sites through alternate channels like ATM & Online Banking All Foreign Offices were brought on Centralized Solution Large network is playing the role of backbone for connectivity across the country Multiple Service Providers are providing the links BSNL, MTNL, Reliance, Tata & reliance which are making the system errorless and provide high speed.
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Multiple Technologies to support the networking infrastructure Leased lines, Dialup, CDMA & VSAT

Thus the managers believe that such a vast change occurred because of the implementation of Internet Banking and Information Technology, which in turn helped SBI grow stronger in the Market.

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4.2.Questionnaire We have used convenience sampling technique. It is also called haphazard or accidental sampling. Members of the population are chosen based on their relative ease of access. The process started when the researcher visited the Bank for collecting information. The researcher had talked to some customers and handed them the questionnaires. Such style of sampling helped the researcher to personally convey the importance to such a research subject and encourage customers to participate in the endeavor. Sometimes called grab or opportunity sampling, this is the method of choosing items arbitrarily and in an unstructured manner from the frame. Though almost impossible to treat rigorously, it is the method most commonly employed in many practical situations. Sample Unit: State Bank of India , Borivali Branch Mumbai. (Customers) Sample Technique: Convenient sampling Sample Area: Borivali, Mumbai. Sample Size: 70 The researcher also interviewed the customers of the State Bank of India 100 questionnaires were sent out of which 70 replied with the answers and their findings are as follows. Working through the findings the researcher has come across issues such as 1. The availability of technology and infrastructure to support the new model of banking. 2. The need for Internet banking itself Internet Banking or an efficient system of instantaneous banking or convenient banking. 3. An adequate mechanism to tackle the security risk and operational risk aspects 4. A proper legal framework to take care of the rights and obligation of the consumers. There is a need to measure and analyze the consumer perception towards Internet banking, to find out what is wrong with traditional banks and provide a framework for the banks to strategically adopt the Internet so as to maximize value for the consumers.

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1. Comparison of Age and Internet Owners. Age 18- 25 26-35 36-45 46-60 61-+ Own an Internet 25 17 12 4 1 Doesnt Own an Internet 4 2 2 1 2

Comparison of Age and Internet Users

Own an Internet 25 17 12 4 4 1 46-60 1 61-+ Doesnt Own an Internet

2 26-35

2 36-45 Age

18- 25

(Table 1: Comparison of Age and Internet Users) From the above interpretation higher percentage of internet owners are from the age group 18-25, thus they have more accessibility. The age group of 26-45, have a very limited access to the internet, as they are often the working class group. They either have access of the internet in their offices or homes. The age group with least is the group of pensioners. Thus it is seen that the age group 18-25 is more prone to use the internet for their banking needs.

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2. Comparison between the age and Internet Usage Pattern

Age 18- 25 26-35 36-45 46-60 61-+ Less than 1 to 6 months Month 5 1 6 4 2 1 6 to 12 months 15 7 5 2 More year 5 3 3 than a

Comparison of User's Age and Internet Usage pattern

Less then a Month 15 1 to 6 months 6 to 12 months More than a year

5 1

7 3 4 5 3 2 2 1 61-+

18- 25

26-35

36-45 Age

46-60

Table 2 : Comparison between the age and Internet Usage Pattern From the above diagram it can be seen that the younger generation have been using the internet for over a period of one year. While other age groups which mainly consists of office-goers, working class and pensioners have just started using the internet banking services.

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3. Usage of Internet
Age 18- 25 26-35 36-45 46-60 61-+ <1 8 13 12 4 3 1 to 3 5 6 2 1 3 to 8 14 8 to 12 12 +

Usage of Internet
16 14 14 12 10 8 8 6 6 4 2 2 0 18- 25 26-35 36-45 Age 46-60 61-+ 1 5 4 3 <1 1 to 3 3 to 8 8 to 12 12 + 13 12

Table 3 comparison of age and usage of internet This table gives the comparison of age and the usage of internet for banking use among the consumers. It is shown that the age group 18-36 use internet more often than the other age group. This is highly because of the acceptance of internet banking among young consumers.

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4. Frequency of visiting the bank branch per month.

Age 18- 25 26-35 36-45 46-60 61-+ <1 14 1 to 3 6 1 3 to 8 4 3 4 3 1 8 to 12 2 5 3 2 12 + 3 11 6 2

Comparison to Age and Frequency of visits to the Bank

16 14 12 10 8 6 4 2 0 18- 25 26-35 36-45 Age 46-60 61-+ 6 4 2 3 3 1 5 6 4 3 3 2 2 11 <1 1 to 3 3 to 8 8 to 12 12 + 1 14

From the result it is evident that the group 18-25 visit the bank only once in a month, since they are students, they arent very well interested in the various other services provided by the bank. The age group which tops the list is 26-35 and 36-45 as they carry the responsibility of the whole family. Hence they regularly visit the bank for the various other services SBI provides such as loans, bill payment etc.

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4. Reasons to visit the bank branch. Age 18- 25 26-35 36-45 46-60 61-+ Deposit Advice 10 9 7 3 2 Balance 6 4 4 4 1 5 3 4 3 2 Withdrawal 3 15 7 2 1 Others 2 1

Comparison of Age and Reason to visit the Bank

16 14 12 10 10 8 6 6 4 2 0 18- 25 26-35 36-45 Age 46-60 61-+ 5 4 3 2 1 3 4 4 3 4 3 2 2 1 2 1 9 7 7 Deposit Advice Balance Withdrawal Others 15

From the evidence it can be seen that the reason for visiting the bank branch maximum number of times by the age group 36-45 is 15.

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5. Comparison of Age and Usage of services offered by the bank. Age 18- 25 26-35 36-45 46-60 61-+ ATM 23 17 13 4 2 Online Banking 23 13 3 1 Telephone Banking 21 11 12 1 3 Mobile Banking 29 14 SMS Banking 12 9

Comparison of Age and Usage of Services offered by the Bank

35 30 25 20 17 15 12 10 5 0 18- 25 26-35 36-45 Age 46-60 61-+ 14 13 11 9 4 1 1 2 13 12 29

2323 21 ATM Online Banking Telephone Banking Mobile Banking SMS Banking

From the above interpretation we can say that all the above age groups use mostly all the service delivery facilities provided by the bank. But the use of Internet banking is more in the age group of 18-25, while it is almost negligible in the age group of 46-61+.

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6. Comparison of Age and the usage of Internet banking services provided by SBI.
Age Product Information 21 13 12 3 Credit Cards Loan Payment Loan Application Personal Bank Activity 12 15 4 1 Checking Online Banking 23 17 10 4 1

18- 25 26-35 36-45 46-60 61-+ Age

20 13 10 3

12 11 7 2

18- 25 26-35 36-45 46-60 61-+

InterOnline Bill Others account Payments Transfers 20 9 10 5 12 4 15 4 9 11 12 4 2 4 1

Comparison of Age and the Usage of Internet Banking Services

25 23 21 20 20 17 15 15 13 13 12 12 11 10 10 9 12 12 12 11 10 10 9 7 5 5 4 4 4 33 2 0 18- 25 26-35 36-45 Age 46-60 61-+ 2 11 1 44 4 15 Product Information Loan Payment Loan Application Personal Bank Activity Checking Online Banking Credit Cards Inter-account Transfers Online Bill Payments Others 20

From the above interpreatation we can that the customer uses internet bank offers basically for seeking product and rate information and secondly for checking balance and then they use
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for to download loan information. The highest usage rate would be in checking online balances and seeking information. 7. Reasons to choose SBI as their Internet Banking
Age Account with the Bank 5 8 7 4 3 Excellent Brand Name Services 17 6 6 7 3 1 1 Others

18- 25 26-35 36-45 46-60 61-+

Comparison of Age and Choice of SBI as their Bank

18 16 14 12 10 8 8 6 4 2 0 18- 25 26-35 36-45 Age 46-60 61-+ 5 4 3 2 1 1 3 7 6 7 6 Account with the Bank Excellent Services Brand Name Others 17

According to the table banks excellent service is the main reason, why customers choose this bank.

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8. What are the factors that motivated you to start internet banking?
Age

CostConvenient effective accessibility

20 14 23 16 9 4 1

Provide accurate information

12 13 4

Provide efficient services

19 6 1

Provide security
20 3

Timesaving
25 13 12 3 1

18- 25 26-35 36-45 46-60 61-+

11
3

Motivational Factors
30 25 20 15 10 5 0 18- 25 26-35 36-45 Age 46-60 61-+ Cost-effective Convenient accessibility Provide accurate information Provide efficient services Provide security Time-saving

From the above answer it is evident that the customers whose use internet banking feel that time saving is most important factor for starting Internet Banking. Cost effectiveness followed the lead as most consumer felt it is easier to manage your money home rather than beating the traffic and reaching the bank.

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9. Apprehension and Nervousness over the use of Internet ?

Age 18- 25 26-35 36-45 46-60 61-+ Yes 6 5 8 3 3 Maybe 3 2 4 2 No 20 12 2

Discomfort Levels
25 20 20 15 10 6 5 0 18- 25 26-35 36-45 Age 46-60 61-+ 3 5 2 12 8 4 2 3 2 3

Yes Maybe No

According to the above diagram, it can be seen that the older people are more prone to discomfort in using the Internet. They are apprehensive because of the uncertainty of outcomes of executing a particular function.

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5. Analysis and Discussion 5.1.Discussion Providing Banking services to the masses in the country as diverse like India is a very challenging work. The service provided should be improved on a regular basis to suit different needs and wants, but at the same time they should be cost effective. In recent times internet as emerged as a perfect medium for solving the problem. The Internet provides the bank with a distribution channel, which if used efficiently promises to increase the scope of services as well as add new customers. From the information attained by the bank managers and IT personal it is seen that there are number of issues pertaining to the existence to Internet Banking. Some important ones pointed out by the bank managers are services to the customers, survival, accessibility, security, acceptance, infrastructure, perception etc. Above all Trust has a significant impact on the acceptance of Internet Banking (Suh and Han, 2002). We will focus on various factors that have a placed themselves in the strategic importance position both for the bank as well as the customers especially in the context of Indian Market. 1. Services This is one of the primary benefits that the customers looks for while adopting a new channel. In any given case the customer is bound to consider the benefits and costs, wherein they weigh the benefits against the cost associated. The benefits here offered by the Internet in terms of Internet Banking are convenience, faster transaction, anytime anywhere banking, updated information etc.

2. Optimism Most consumers also consider themselves to be very active users of banking services, implying that, by becoming an internet banking user, there would be few, if any, benefits for them. Optimism towards other technologies like the TV, radio, transportation systems, and telephone do not reflect itself in the case of banking as here the consumer initiates the process and mostly it is the case of self-service. The interaction is one way and hence the level of optimism is very low.

3. Security Issues.

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With the growth of Internet Technology also comes in the growth in the number of population who take advantage of the loopholes in the system. Thus security issues are important because fraudsters can make life unsafe and miserable. Any Internet Banking user could be a victim of a cyber crime in several ways. From stealing passwords and user ID by an intelligent guess or by trying their luck over several attempts. Others could send cleverly conceived e-mails to deceive into disclosing the credit card number, bank account details, password and other sensitive details. More sophisticated attacks involve installing spyware and Trojans (software that spy on what is going on in the PC), through web links and e-mail attachments to collect information from the PC. A hacker could also get to the user ID and password through unauthorized access. To prevent such frauds, most banks that offer online banking facility have adopted 128-bit Secure Socket Layer (SSL ) encryption technology. This ensures that the information exchanged between the computer and the banks website is completely protected. SSL is the universally accepted standard for authenticated and encrypted communication between customers computers and servers. They also have a firewalla virtual electronic wall to prevent unauthorized access to the banks serversto prevent hackers from hijacking information (Sriram, 2005).

4. Accessibility Durkin (2004) noted the role of workplace access in internet banking adoption but did not associate it with perceived convenience or the male gender. There is an immediate need for SBI to address this issue. SBI can investigate the potential for promoting the goodwill of the business by allowing employed to do their banking online at work. In India, internet is still at a growing stage, thus not everyone possess a desktop at home or an internet connection. Accessibility is a major issue, as the bank wants to target a major chunk of population from the middle-class.

5. Habits This factor was raised by the bank managers in the focus group discussion. One of the managers commented that banking consumers who habitually use particular banking methods find their own form of banking convenient. While in one recent study, habit was found to play a key role in Internet Banking use (Wan et al.,

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2005), habit has not previously been linked to consumer perceptions of Internet Banking convenience. In Chung and Paynters (2002) internet banking adoption study, it was found that non-users of Internet banking did not need high level of convenience. However, quite possibly their studys participants found their own methods convenient enough, due to habit. Our finding suggests that methods that address the changing of habit are needed in order to persuade consumers to move to internet delivery.

6. Lack of Awareness There is lack of awareness of Internet Banking and its benefits. Many consumers are unaware of the facility provided by the Bank. This is largely because of the ignorance towards the banking technology. The unawareness level is high in the consumers in the age group of 35-60. Many users believed that their banking needs are already being met and thus they didnt feel the need to learn about internet banking. Also, the various consumer groups do not perceive the public sector banks as banks that may be offering online services. However, the officials of these banks feel that their perception in the market is likely to change soon once they put on advertising efforts in that direction. The banks, which that are proposing the Initial Public Offer (IPOs) of securities in near future, can think of simultaneously positioning themselves as the new generation banks. Interestingly, the awareness of online offering is polarised towards their (Consumers) own banks from which they are availing the banking services. The users usually visited the bank for depositing money, asking about loan etc. they were content with such kind of service and hence the ignorance towards Internet Banking. The Education rate in population is also not high. The bank should overcome such issues by attracting customer attention towards internet banking through better marketing techniques. They should regularly inform consumers about the features, advantages and benefits of Internet Banking.

7. Regulatory and Supervisory Concerns Internet banking requires the banks internal systems to be linked with the systems, the knowledge of which operates in public domain. Further, the concept of conventional audit trails is not logically applicable to Internet banking. Therefore,
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Internet Banking is susceptible to risks in the form of criminal activities, such as fraud, money laundering, tax evasion etc. Internet banking allows the banks as well as customers to operate with geographical; boundaries thus creating a problem of exchange controls. Banking in India is governed by various statues including Banking Regulations Act, 1949, the Reserve Bank of India Act, 1934, and the Foreign Exchange Management Act, 1999, Information Technology Act, 2000 and is also influenced by various laws governing trade and commerce viz. Indian Contract Act, 1872, the Negotiable Instruments Act, 1881, Indian Evidence Act, 1872, etc. The provisions contained in these acts are equally applicable to Internet banking. It can be seen that still the laws need to be amended and made clear in relation to the Internet banking transactions. A study conducted by Gupta (2006) also raised concerns over data protection provisions. The impact of Internet banking on monetary and credit policies of Reserve Bank of India is a critical area of concern. In developed countries a broad regulatory framework for Internet banking exits which is still pending in India

8. Security, Privacy and Trust concerns Some consumers associate risks, especially security risks, with using the internet. Privacy and the concern that internet-delivered instructions might not yield a similar reaction from the bank when compared to that of the reaction evicted by the human interaction makes them stay away. Such resistance could be avoided if the risk associated with the Internet Banking services could be reduced cost should be made visibly lower and use different strategies for the middle age consumers to switch. Also there is a need to explain to each of these consumers that using Internet banking would not only save time and cost but also make them more efficient and capable.

9. Discomfort Lack of control over technology could be indentified with the consumers interviewed during the process. They generally feel overwhelmed with the technology. The main reason for such behaviour is the lack of communication. According to the IT professional who handles customers IT queries over phone states

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that the customers are apprehensive about what happens after a command is executed or a request is placed online. 10. Consumer Expectations The expected level of performance and the actual performance of the conventional banking system shows a huge gap. However, trust is interestingly found to be a major area of concern. The conclusion is therefore be derived as follows: Consumers feel that Internet banking is easier compared to conventional banking; Conventional banking lacks speed especially in case of public sector banks; Ratings on various parameters were found comparatively higher in case of frequent users and high-income groups.

11. Use of Interactive channels There is a high need for extensive and deep levels of consumer support from the Bank, especially in terms of immediate availability of support-oriented knowledge. While recent studies have noted a need for information provision on banking web sites (Waite and Harris, 2004), this is the first study to observe the need for immediate, interactive, knowledgeable consumer support for internet banking, from the beginning of the set up procedure onwards. Such support should be available from all banking personnel encountered, including branch personnel. It is simply not acceptable nowadays for a bank employee who is asked for assistance at a branch or in a contact centre to know little or nothing about internet banking.

General Discussion The overall research carried out confirms that Internet Banking has proved to be the dark horse for SBI. Since its inception it has been able to provide valuable services to the customers as well as the Managers. The greatest benefit of Internet Banking is that it is cheap or even free for customers. It is not tied down to a particular hence time and place, thus providing anytime anywhere banking solution. The range of services offered is fairly broad. The customers can do everything from checking their bank account balance to transferring money and paying taxes. The range of advantages offered by the Internet Banking propels a positive impact on

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customer satisfaction. To summarize Internet Banking in particular provides many benefits to both service providers i.e., SBI and the customers. From the above discussions with Bank Managers, IT personal and customers the researcher was able to device an SWOT analysis of the Internet Banking of State Bank of India. Strengths:

Greater reach to customers Quicker time to market Ability to introduce new products and services quickly and successfully Ability to understand its customers needs Customers are given access to information easily across any location Greater customer loyalty Easy online application for all accounts, including personal loans and mortgage 24 hours account access Quality customer service with personal attention

Weaknesses:

Lack of awareness among the existing customers regarding internet banking Obsolesce of technology take place very soon specially in terms of security on internet.

Procedure for applying for id and password for using services related to internet banking takes time.

Lack of knowledge is found regarding internet banking in employees of SBI Implementation of newer technology is little bit complicated Employees needs training to obtain knowledge regarding I-banking

Opportunities:

Approximately 60% of customers are not using internet banking. Core competency can be achieved in terms of banking if focus is made on awareness of internet banking

Can become 1st virtual bank of India. Concentration of various services should be made using internet banking

Challenges:61 2009 LJMU

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Maintaining Business Edge over competitors in the context of sameness in IT infrastructure

Multiple vendor support is necessary for working of highly complex technology Maintaining secured IT infrastructure for business operations

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6. Recommendations Thus there is a lot to learn and develop in terms of internet banking as there weakness the bank needs to work on. From the survey it can be seen that main problem faced is with the importance of internet. It can be seen that though internet Banking is available the customers often visit the bank for their work. Going through the survey the main problem lies that still customer have a fear of hacking of accounts and thus do not go on for internet banking. Providing the best security option is the need of the hour. It has been derived from the survey that the maximum numbers of Internet Bank Account holders are the Youth and business man. But the customer base of bank is largely made up by the middle-class population of Borivali. Thus the Internet Banking base only covers the niche market of SBI. If proper training should be given to customer by the bank employs to open an account will be beneficial secondly the website should be made friendlier from where the first time customers can directly make and access their accounts. We can see the time is changing and we the passage of time people are accepting technology there is still a lot of perceptual blocking which hampers the growth its the normal tendency of a human not to have changes work on the old track, thats also one of the reason for the slow acceptance of internet banking accounts.

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Training and awareness among employees:It has been recommended by the managers that there is a need for providing training programmes for the employees. Such a training programme will make the employees aware of the various terms of internet banking. After such programmes they can create awareness amongst the consumers. It is believed by many managers that the employees should work towards enhancing the internet banking services of State Bank of India.

Increase Human Interaction The lack of human interaction when sourcing financial services over the internet should be removed and more interactivity should be brought into the service. The customer shouldnt feel the difference between a regular branch banking interaction and the Internet banking interaction. In fact the second one should be made more accurate, efficient and pleasant for the consumer to latch on to it. The consumer should be made to realize how the new technology would be enabling him to be more clear and convenient than the branch banking approach. This having been done, there is a lot of scope for the consumer to accept the new technology - either Internet banking or something else.

Exchange of information on threats and vulnerabilities at appropriate forums:The managers have decided that there is a need for an open end discussion. Such a discussion will provide valid information on the threats and vulnerabilities faced by the employees. Suggestions received from various branches would provide help to the employees and the IT people to consider.

Build

an

optimal

operating

model:-

It is suggested that to have a clear sight of operations and for the purpose of ease of employees, some operations should be outsourced to other companies. Outsourcing operations like cyber security department, IT structure etc. Bank should Create and sustain customer, investor and regulator confidence by adopting international accounting standards :Many customers feel that SBI should adopt international accounting standards

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in order to be more efficient in its operations. Adopting international standards adds more star to the glory of any company. SBI should impose such standards when it comes to internet banking or virtual banking. Such a step will enhance the goodwill of the Bank among its regulators, customers and investors.

Bank should anticipate and get prepared for regulatory changes: Various managers and the IT team expressed concerned about the changing cyber and information technology protection act. These laws are changed as per needs. Thus SBI should anticipate such changes and get geared up with various plans and actions.

Focus on identifying core competence:SBI possess unique characteristics or positive points to lead the market. Working more on this positive aspects will help them lead the market. Bank should identify such points and concentrate to flourish them more. This can be done with the help of internet banking, as internet banking of SBI is getting largely accepted by customers.

Increasing usage of mobile phones is going to revolutionize the banking culture in near future:Mobile banking is also getting popular in the segment of internet banking thus this can add some more steps to progress for SBI. Bank is into the mobile banking but it is providing limited features.

More stress should be given on security concern on internet:There are some people who are into unethical practices of hacking of accounts of customers. This is nothing but the breach in the security of the SBI on internet. There should be some measures in order to prevent such practices. IT structure should be unbreakable.

Pricing Concerns Pricing concerns like the cost of buying a PC, having an Internet connection should be minimized. One option is to use the Hole-in-the-wall concept where each of the
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ATMs will be modified to be used like computers. This would not only reduce the cost of installation to the consumer but also increase the chances of usage as the acceptability is now paired with the ATM technology which has already achieved the popularity and matured as a part of the banking system. Even in the case of consumers owning the technology and the facility, the need to realize the uses of the interaction is important. This may be accompanied with an incentive which might be a motivator for the usage of the technology. Resistance to Change The need to shift towards Internet banking is not felt among employees of the banks and hence there is no need to push the customers to use it. Most of the employees in the banks are themselves not aware as to what Internet banking is and how to use it. They dont realize the need to push the same to the customers. Hence there is a clear need for the banks to educate and enable the employees to use it. Only when the employees become technology users, it will be possible for them to be advocates of Internet banking. Increase in the customers role Increased consumer role in the service delivery is another solution as here the consumer initiates the interaction and a stick with it to get what he wants to do. The interaction is more meaningful and is centered around the consumer. Like the IVR penetration and acceptability, technology is accepted faster when the consumer gets to choose more and gets told less. The same applies to Internet banking, which provides more interactivity, involves the consumer in the designing process, asks for feedback, gets back with the revert, makes customized features, provides personalization and encourages customer participation in the process. The customer is more comfortable when he is involved in the process right from the inception phase of the technology. Banks need to realize this and encourage more participation by conducting camps to educate and take feedback in all cities and start Internet banking drives. This may be done at the bank branches when the customers interact face-to-face with their advisors, but it is also possible by Internet banking and at significantly lower costs. Only when the ownership is moved to the consumer, at least partly, will it be thrust upon them to move online.

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Wider Scope of E-Channels The banks should make the area of e-delivery channels wider by providing the facility of draft making, mega-size withdrawals and deposits and even provide loans to the customers. This will further strengthen the popularity of these channels and help to earn more income by way of more charges on mega-size deposits and withdrawals.

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7. Conclusion Studying the project we came to know that Internet banking is clearly the way forward for the State Bank of India. It provides comfort to customers at the same time it provides cost cutting to SBI by eliminating physical documentation. Internet banking saves time of bank as well as those of customers. Study states that internet banking provides greater reach to customers. Feedback can be obtained easily as internet is virtual in nature. Customer loyalty can be gain. Personal attention can be given by bank to customer also quality service can be served. Bank should know that No system is perfect, however a system of such a type will need to be very secure. This is a system which holds account details and customers wealth. If such a system was not trusted and not reliable, then SBI would face serious laws and would lose business. The study has been an eye-opener, as it discussed and brought to light various issues of internet banking in State Bank of India and India as a whole. Though Internet in India is still at a primitive stage and mostly dominated by multinational organization, SBI has been able to step forward and experiment with this new technology and achieve success. From the research trust and security emerged as the main issues in the minds of the consumers, thus the researcher provides a solution to the bank suggest building a strong system security not only attract customers but also develop their trust in the bank. From the survey it is evident that most internet banking customers choose to check their balance online, but fewer choose to transfer money through online services, they still feel safe personally going to the bank and handling cash. The level of worry is higher regarding trust; customers dont feel confident enough to carry out big financial decisions on the internet. Internet is a medium of delivering the services of the Bank. It should be treated as a part of overall customer service and distribution channel. The relationships developed on such a platform could provide an opportunity for the delivery of product information. These measures will in-turn increase the movement of customers over the internet. After studying the SWOT analysis, we came to know various strengths of SBI such as quality customer service, greater reach, customer loyalty, easy access to information, 24 hours access, easy online applications etc. SBI should put efforts to multiply the number of

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strengths. In terms of weakness I come to know some of the major weaknesses they are lack of awareness of internet banking among the customers, obsolesce of technology related to security, complicated procedures of availing internet banking facilities, lack of knowledge among the employees of SBI. SBI should concentrate on the weaknesses and reduce them to zero. In the third segment of SWOT analysis of internet banking we dealt with opportunities like 95 % market of internet market is untapped, SBIs path to become first virtual bank. By encashing such opportunities bank can become the leader in banking sector of India. In the last segment I come to know about various challenges which are in front of SBI, like sameness in IT infrastructure within various banks, need of various vendor supports for complex technology, maintaining secured IT infrastructure, alternative mechanism in case of failure of present security system. The company can take the advantage of the reputation it has created in the market for itself and become more competitive The recommendations and suggestions given, if adopted will improve the position of the company substantially and optimal profitability coupled with better service and satisfactions for investors may be achieved.

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8. Reflection In this chapter, researcher has presented the various skills and competences which she has developed during her whole MBA programme at Liverpool Business School. The researcher has also summarized her dissertation which is the most precious work of her life. Writing the last word of the dissertation gave a real relieve to the researcher; she knows how much hard work she had put in her work. Studying at Liverpool Business School was such a wonderful experience of researchers life which she can never forget. Briefly, it lays importance on the skills acquired, challenges faced and benefits gained by her, with a sole aim to attaining a responsible professional position. 8.1. THE MBA DECISION The researchers prior work experience of nine months consisted of working as a Team Member in an IT Recruitment Agency. Having dealt with the Team Leaders and Managers in the firm the author realized the importance of a Masters Degree to a Bachelors one. A Masters Degree from a well-renowned university will open the gate for more opportunities in growing internally as well as increase the authors value in the Job Market in the world. The main reason for doing a Masters Degree abroad was to garner international exposure and gain entry into developed markets. Such a compelling degree will help in improve the skills of the author in obtaining intrinsic and explicit knowledge. The very fact of choosing a university abroad is to experience different individuals coming from various backgrounds and hence learning from their experiences. Opting for a part-time job, will not only help the author in solving the financial issues, gather valuable international experience in working with different cultures and diversity of people, thus enhancing her people skills and civic skills. Studying abroad inculcates time management and independent living qualities of the researcher. Taking into consideration the above factors and the urge to achieve profound business knowledge drove the author to opt for an MBA (International) Programme. Various courses were available in different countries, but the main reason for selecting England, was its associations with the successful businesses in the world, its steady economical growth and its glorious academic past. It has been a favourite study destination for all scholars around the world. The country aids the students in their educational endeavour by providing the
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providing provisions for part time work, thus enabling to manage their routine expenses. The Post-Graduate Scheme allows a student to explore a market in the country and establish a firm ground for one-self after successful completion of course. Deciding upon a university was a very tedious process, as there were number of universities to choose from. The author consulted various education counsellors and students, resulting which she selected the Liverpool Business School (LJMU). It was selected because of its reputation, the modules and subjects offered and comparatively low fees compared to other universities. The researcher started her MBA in January 2008 . The author got really inspired by the personality, the teaching style and deep knowledge of all the tutors during his course. She started to show keen interest in all the modules. The various management techniques that author has learned from International Management has been adopted in her research. Working in Groups The author believes that in every field a person has to work in groups of different culture, age and work experiences to achieve a common goal. One of the major skills the author has learnt is how to form and work in groups. In International Management module, during the initial stage of the group formation, the author form a group of five members but soon one of the members left the course and this reduced the numerical strength of the group, which was the indication of weaker performance as compared to other groups. Yetton and Bottger (1983) say that the performance of a group depends upon the ability of its best two members and it doesnt change significantly with the addition or deletion of other members. This was the challenge for the authors small group to increase the individual effort and this was evident during the group work experience. According to Amason and Sapienza (1997) and Wiersema and Bantel (1992), group diversity is beneficial as it promotes cognitive diversity, creativity and wide range of problem solving. However, Watson and Kumar (1992) claimed that ethically and racially diverse groups experience conflicts within the group and lack in communication and cohesiveness. The authors group experienced a limited diversity as all the group members were of more or less same age, but the cultural background and work experiences diversity helped the group to bring together different solutions to a similar task and helped to choose the best solution.

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Motivation and leadership The author has learned how motivation among the group members helps in achieving the common goal. According to Jacques (1991), fluid leadership within a group helps in motivating the group members and makes the group more productive with time and learning. Moxon (1993) considered the discussion loop to ensure productive discussions which make it easy to share the ideas and feelings with a view to gain some form of consensus agreement. The discussion loop helped the group in knowledge and leadership sharing and a methodical way of performing our task. It also facilitated feedback from the group to the individual members on their various topics which is necessary for the learning purpose. This model helped us gain a deeper understanding of the entire task at hand which was proved during the question and answer session that followed the presentation, where each and every member took an active part. Communication The researcher was struggling with the communication skills during her work tenure in the company which was the biggest drawbacks in the growth and development of the individual. The continuous interaction with the group members in the tutorials and meetings helped the author in developing her communication skills. She learnt how to express views and discuss them with the group members. This helped the author in taking the interviews and communicating well with the interviewees to do the proper analysis of her findings for her research 8.2 Dissertation: A real time project Starting with dissertation was not easy for the author; she had to work on the real time problem of an organisation, unlike the case studies provided during the course. The other main problem was the Bank, researcher choose was in India and thus electronic communication was of major importance. The authors work background with the Bank in past motivated her to do the research on State Bank Of Indias Internet Banking system. The real encouragement from my former Bank Manager who is currently retired he supported the researcher a lot through the whole project. The researcher had never undertaken a real time project and applied the various theoretical models in real management practices. Dissertation gave her this platform and

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helped in gaining the real skills and competences. During her dissertation, she found that SBI being a public sector bank is always been open to changes and strives hard to stay in the top despite its bureaucratic operations. The author has also shown the recommendations of the research to Bank Manager. The Manager felt very impressed with the findings and he assured that he will try to apply these recommendations. 8.3 Change and Improvement The journey of MBA was knowledgeable, entertaining and challenging too. The author has learnt how to manage the various tasks simultaneously with the job, studies and other day-to-day tasks. The author was the last minute person before undertaking MBA; she learnt how careful planning enables to complete the tasks on schedule time. The author believes that has noted many changes and improvements throughout her MBA program. - Applying Theories in practical management The theoretical concepts and models were far more different from the practical management for the author. MBA program taught how important the knowledge of theories is in practical management. Dissertation helped in analyzing the problem in the organisation and applying the theories in the practical situations. - Teaching and Learning Style The author appreciates the teaching and learning style of the MBA program which includes summarization of theories, group work, critical analysis, presentations and individual assignments. This approach has helped the author to gain highest marks in group reflective report in International Management, highest marks in presentation in Interpreting financial statements and highest marks in individual report in Project Management. 8.4 Future prospects This course has helped the author in developing both his interpersonal and conceptual skills which are required to get a good job in this highly competitive world. This course has also widened the scope for job opportunities all over the world rather than only to his country. The author is currently working in Lidl Foodstores, Edinburgh, United Kingdom as a part-time customer assistant. The researcher previously in India did work for State Bank of India, thus the dissertation was just an extension of the skills and competencies she learnt while working at the bank. This helped in applying the theoretical models, which she had
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learnt during the MBA course, in practical life. The author believes that if she applies the knowledge and the skills which she has learnt during his masters course, her future prospects are bright and can make dream into reality.

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31. Kamath K.V., Kohli S.S., Shenoy P.S., Kumar R., Nayak R.M and Kuppuswamy P.T., (2003), Indian Banking Sector Challenges and opportunities, Vikalapa, Vol 28, Issue 3, pp 83- 99. 32. Kannabiran, G and Narayan, P.C. (2005), Deploying Internet Banking and Ecommerce- case study of a private sector bank in India, Information Technology for Development, Wiley Periodicals, Vol. 11, No. 4, pp. 363-379. 33. Krippendroff, K (2004), Content Analysis: An Introduction to its Methodology, 2nd edition, Thousand Oaks, CA: Sage Publications 34. Kolb, D. A. (1984). Experiential learning: Experience as the source of learning and development. Englewood Cliffs, NJ: Prentice-Hall. 35. Kalakota, R., & Whinston, A.B. (1997). Electronic commerce: A managers guide. Reading, MA: Addison Wesley. 36. Kulkarni R V (2000), Changing Face of Banking from Brick and Mortar Banking to E-Banking, IBA Bulletin (January) 37. Lockett, A. and Littler, D. (1997), ``The adoption of direct banking services'', Journal of Marketing Management, Vol. 13, pp. 791-811. 38. Long M. & McMellon C. (2004), Exploring determinants of retail service quality on the internet, Journal of service marketing 16 (1), 78-90. 39. Messmer, E. (1999). E-commerce software catches Wells Fargos eye. Network World, 16(33), 42. 40. Metzer S R (2000), Strategic Planning for Future Bank Growth, The Bankers Magazine (July-August), pp. 57-65 41. Merton, R.C. (1992), Financial innovation and economic performance, Journal of Applied Corporate Finance, Vol. 4 No. 4, pp. 12-22 42. Meuter, M.L., Ostron, A.L., Roundtree, R.I., Bitner, M.J. (2000), "Self-service technologies: understanding customer satisfaction with technology-based service encounters", Journal of Marketing, Vol. 64 No.3, pp.50-64. 43. Miller, M.H. (1986), Financial innovation: the last twenty years and the next, Journal of Financial and Quantitative Analysis, Vol. 21 No. 4, pp. 459-71. 44. Miller, M.H. (1992), Financial innovation: achievements and prospects, Journal of Applied Corporate Finance, Vol. 4 No. 4, pp. 4-12. 45. Mittal S R A (2000), Payment Systems in HighTech. Banking, The Journal of The Indian Institute of Bankers, Vol. 71, No. 3 (July-August), pp. 8-19.

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79. Scott William L. (1999), Markets and Institutions-A contemporary introduction to Financial Services, South-Western College Publishing, p.308. 80. Sullivan, R. and Wang, Z. (2005), Internet banking: an exploration in technology diffusion and impact, Working Paper 05-05, Payments System Research Department, Federal Reserve Bank of Kansas City, Kansas City, MO. 81. Strauss, A. and Corbin, J (1998), Basics of Qualitative Newbury Park, CA, Sage. 82. Sekaran, U. (2003), Research methods for business A skill building approach, 4th edition, New York, John Wiley & Sons. 83. Saunders, M, Lewis, P and Thornhill, A (2003), Research methods for business students, 3rd ed., Imprint Harlow: Financial Times Prentice Hall, 2003. 84. Saunders, M, Lewis, P and Thornhill, A (2006), Research methods for business students, Edition 4th ed. Imprint Harlow: Financial Times Prentice Hall, 2006. 85. Thompson, Arthur A., Jr., A. J. Strickland, and John E. Gamble. Crafting and Executing Strategy: The Quest for Competitive Advantage Concepts and Cases. Boston, et al.: McGraw-Hill Irwin, 2005. 86. Taylor, H., (2005), Congruence between risk management theory and practice in Hong Kong vendor-driven IT projects, International Journal of Project Management, Vol. 23, pp 437-444. 87. Uppal R K (2006), Indian Banking and Information Technology, New Century Publications, New Delhi. 88. Vijay K (2002), Job Satisfaction Among Bank Employees: Cadre Wise A Case Study, IBA Bulletin, Vol. XXIV, No. 2 (February), pp. 29-34. 89. Verghese M E and Ganesh C (2003), Customer Service in Banks: An Empirical Study, Vinimaya, Vol. XXXIV, No. 2 (July-September), pp. 15-26. 90. Van Horne, J.C. (1985), Of financial innovations and excesses, Journal of Finance, Vol. 40 No. 3, pp. 621-31, Papers and Proceedings of the 43rd Annual Meeting American Finance Association, Dallas, Texas, December 28-30, 1984. 91. Wylie, I. (1999), ``Online, but on the case?'', The Guardian, 23 January, p. 23. 92. Rakesh Mohan, "Valedictory address", The Bank Economist Conference, India, 2002. 93. Y.V Reddy, "Capital Inflows and Self Reliance Redefined", Twenty seveth Moraes Lecturer, July 17th 2000. Research, 2nd edition,

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94. Zeithml V. (2002), Service excellence in electronic channels, Managing Service Quality, Vol 12, Issue 3, pp. 135-138 95. Wolcott, h (1995), Making a study more ethnographic, in J. VAN MAANEN (ed.), Representation in Ethnography, Thousand Oaks, CA: Sage. 96. YIN (1994), Application of a Case Study Methodology by Winston Tellis, The Qualitative Report, Volume 3, Number 3, September, 1997 97. Zahra, S.A. (1999), The Changing Rules of Global Competitiveness in the 21st Century, The Academy of Management Executive, Vol. 13, Issue 1, pp 36-42. 98. State Bank of India (www.statebankofindia.com) 99. Well Fargo Bank (2000) http://www.wellsfargo.com. 100. The Economist (1999), ``Survey business and the Internet the Net

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http://www.iamai.in/.

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10. Appendixes 10.1. Appendix 1 Kolbs Learning cycle

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Appendix. II Information Sheet for Research Participants Internet Banking In India - The State Bank of India Case Study Thank you for showing your interest in this research. Please read the following information sheet carefully before deciding whether or not you wish to participate. Participation in this study is entirely up to you. Purpose I am conducting a survey as a partial fulfilment of the requirements for the degree of Masters in Business Administration from Liverpool John Moores University, Liverpool, Merseyside, United Kingdom. The university website is www.ljmu.ac.uk. My research concerns to explore the Internet Banking adoption in Indian Banking Sector, specifically taking into account The State Bank of India. This study will investigate the adoption and use of Internet Banking, indentify the problems that individuals and organizations in this case, The State Bank of India and its customers encounter while adopting or using Internet Banking and outline strategies, which propose opportunities for organizations and consumers to expose unseen problems. Description The purpose of this interview is to explore and identify the factors which influence the uses and adoption of the Internet Banking in India for example cultural issues, trust in bank, web services, and the technology used in bank service and the online system quality. In this interview I ask your opinion in the general discussion about Internet Banking issues and its adoption and uses. I may also ask some background information about the demographical data such as age, sex, education, experience and income. The interview will take maximum one hour. The interview will be videotaped or audio taped with your permission. The interview will be confidential. It may be necessary to ask you to participate in a further interview in order to clarify issues raised in the first interview. I will contact you if it is necessary and arrange a meeting time and place which is suitable. I will send back the transcribe of your interview to read it and if you disagree of any items you can erase it and by the end of the research you will receive a report summary of this study. Confidential Your responses will be treated in strict confidence by the researcher. Any result reported will be done in aggregate to protect your anonymity and will not show any participant or organization identity if requested by you. Your help and participation is highly respected and will assist me in completing my studies.

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Appendix III Questionnaire This survey is designed to understand Internet users perspectives on Internet banking, their experience with Internet banking, and their expectations on Internet banking services. Your participation in this survey is greatly appreciated.

1. Name___________________________________________________________________ 2. Age 18-25 26-35 36-45 46-60 60-+ 3. Gender Male Female

4. Occupation ________________________________________________________________

5. Do you own Internet? Yes No.

6. How long have you been using the Internet ? Less than 1 month 1 to 6 months 6 to 12 months More than 1 year
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7. How many hours per week do you use your computer for Banking use? Less than 1 1 to 5 hours 5 to 10 hours 10 to 20 hours over 20 hours

8. How frequently do you visit your bank branch per month? Less than 1 1 to 3 times 3 to 8 times 8 to 12 times over 12 times

9. How frequently do you use an Automated Teller Machine (ATM) per month? Less than 1 1 to 3 times 3 to 8 times 8 to 12 times over 12 times

10. What is the main reason that you typically visit your bank branch (please choose the single most important reason)? to make a deposit to get advice for investment options to inquire about a balance to withdraw cash other

11. Which SBI banking services do you currently use?

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ATM Online Banking Telephone Banking Mobile Banking

12. Which Internet Banking Services do you use? Product Information Loan Payment Inter-account transfers online Bill payments others 13. What was the single most important reason that you chose this particular bank as your Internet bank? (please choose one) I have a traditional bank account with the same bank The brand name of the bank The excellent service offered by this bank Others 14. What are the factors that motivated you to start internet banking? Cost Effective Convenient Accessibility Provides Accurate Information Provide efficient service Provides Security time saving

15. In addition to your Internet bank account, do you also do traditional banking?

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Yes No

16. Do you believe that Internet is the safest haven for transacting with cash? Yes No May be

These questions were asked if the respondent answered "No" to the above question.
17. What are the main reasons that you have not opened an Internet bank account yet? (check all that apply) Under age Never heard of Internet banking Concerned about security Haven't taken time to open an account Don't see any real value in having this type of account Too new. I would like to see how it works, then I may open an account Not available through my bank Others Not Applicable

18. How likely is it that you will open an Internet bank account within the next 12 months? Very Unlikely Somewhat Unlikely Neither Unlikely nor Likely Somewhat Likely

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Very Likely Not applicable

(Thank you very much)

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Preeti Pawar -357358 Appendix IV (http://www.internetworldstats.com/asia.htm)

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ASIA INTERNET USAGE AND POPULATION

ASIA Afganistan Armenia Azerbaijan Bangladesh Bhutan Brunei Darussalem Cambodia China * Georgia Hong Kong * India Indonesia Japan Kazakhstan Korea, North Korea, South Kyrgystan Laos Macao * Malaysia Maldives Mongolia Myanmar Nepal Pakistan Philippines Singapore Sri Lanka Taiwan Tajikistan Thailand Timor-Leste Turkmenistan Uzbekistan Vietnam TOTAL ASIA Population ( 2009 Est.) 28,395,716 2,967,004 8,238,672 156,050,883 691,141 388,190 14,494,293 1,338,612,968 4,615,807 7,055,071 1,156,897,766 240,271,522 127,078,679 15,399,437 22,665,345 48,508,972 5,431,747 6,834,345 559,846 25,715,819 396,334 3,041,142 48,137,741 28,563,377 174,578,558 97,976,603 4,657,542 21,324,791 22,974,347 7,349,145 65,998,436 1,131,612 4,884,887 27,606,007 88,576,758 3,808,070,503 Internet Users, Penetration User Growth Latest Data (% Population) ( 2000-2009 ) 500,000 191,000 1,485,100 556,000 40,000 217,000 74,000 360,000,000 1,024,000 4,878,713 81,000,000 30,000,000 95,979,000 2,300,000 -37,475,800 850,000 130,000 259,000 16,902,600 71,700 330,000 108,900 499,000 18,500,000 24,000,000 3,370,000 1,163,500 15,143,000 600,000 16,100,000 1,800 75,000 2,469,000 21,963,117 738,257,230 1.8 % 6.4 % 18.0 % 0.4 % 5.8 % 55.9 % 0.5 % 26.9 % 22.2 % 69.2 % 7.0 % 12.5 % 75.5 % 14.9 % -77.3 % 15.6 % 1.9 % 46.3 % 65.7 % 18.1 % 10.9 % 0.2 % 1.7 % 10.6 % 24.5 % 72.4 % 5.5 % 65.9 % 8.2 % 24.4 % 0.2 % 1.5 % 8.9 % 24.8 % 19.4 % 49,900.0 % 536.7 % 12,275.8 % 456.0 % 7,900.0 % 623.3 % 1,133.3 % 1,500.0 % 5,020.0 % 113.7 % 1,520.0 % 1,150.0 % 103.9 % 3,185.7 % -96.8 % 1,547.3 % 2,066.7 % 331.7 % 356.8 % 1,095.0 % 1,000.0 % 10,790.0 % 898.0 % 13,716.3 % 1,100.0 % 180.8 % 857.6 % 141.9 % 29,900.0 % 600.0 % 0.0 % 3,650.0 % 32,820.0 % 10,881.6 % 545.9 % Users (%) in Asia 0.1 % 0.0 % 0.2 % 0.1 % 0.0 % 0.0 % 0.0 % 48.8 % 0.1 % 0.7 % 11.0 % 4.1 % 13.0 % 0.3 % 0.0 % 5.3 % 0.1 % 0.0 % 0.0 % 2.3 % 0.0 % 0.0 % 0.0 % 0.1 % 2.5 % 3.3 % 0.5 % 0.2 % 2.1 % 0.1 % 2.2 % 0.0 % 0.0 % 0.3 % 3.0 % 100.0 %

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