Importance of Internet Technology in Banking Services: Evidence from Focus Group Study

Ephrem Habtemichael Redda

Abstract

Global business environment forces such as globalization, technological advancements, financial innovation, regulation, and deregulation have driven banks to utilize alternative channels such as electronic banking (e-banking), mobile banking and automated teller machines (ATMs). This study aims to determine and highlight the importance of technology-enabled banking services using a focus group study method in an emerging market, South Africa. The study used a descriptive research design and a qualitative research method. The findings of the focus group study revealed that customers opt to use e-banking because it provides them with several benefits and identify crucial e-banking dimensions such as privacy and security, ease of use, availability, convenience, efficiency, reliability, responsiveness and contact and aesthetics. The results of the study suggest that the e-banking service indeed creates value for customers, enhances their banking experience that ultimately creates satisfaction, and builds a long-term bank-customer relationship, which translates into customer loyalty. The insight provided in this study is expected to assist marketing scholars and professionals engaged in the banking sector. By determining and highlighting the importance of technology-enabled banking services using a focus group, this study provides original insight into consumer behavior in technology-enabled products in an emerging market, South Africa.

 

Keywords: technology, e-banking, focus group, value, satisfaction, loyalty.


Full Text:

PDF


References


AGYEI, J., SUN, S., PENNEY, E.K., ABROKWAH, E., BOADI, E.K., & FIIFI, D.D. (2022). Internet Banking Services User Adoption in Ghana: An Empirical Study. Journal of African Business, 23(3), 599-616. https://doi.org/10.1080/15228916.2021.1904756

ALHASSANY, H., & FAISAL, F. (2018). Factors influencing the internet banking adoption decision in North Cyprus: an evidence from the partial least square approach of the structural equation modeling. Financial Innovation, 4(1), 29. https://doi.org/10.1186/s40854-018-0111-3

ALHAWAMDEH, L.N., ALSMADI, A.A., HASAN, E., RIFAI, F., & AL-GASAWNEH, J.A. (2022). The Determinants of Internet Banking Services Adoption in the Emerging Islamic Banking System. Journal of Southwest Jiaotong University, 57(1), 696-705. https://doi.org/10.35741/issn.0258-2724.57.1.62

ARBORE, A., & BUSACCA, B. (2009). Customer satisfaction and dissatisfaction in retail banking: exploring the asymmetric impact of attribute performances. Journal of Retailing and Consumer Services, 16, 271-280. https://doi.org/10.1016/j.jretconser.2009.02.002

AREFJEVS, I., SPILBERGS, A., NATRINS, A., VERDENHOFS, A., MAVLUTOVA, I., & VOLKOVA, T. (2020). Financial sector evolution and competencies development in the context of information and communication technologies. Research for Rural Development, 35, 260-267. https://doi.org/10.22616/rrd.26.2020.038

ARIFF, M.S.M., YUN, L.O., ZAKUAN, N., & JUSOH, A. (2012). Examining dimensions of electronic service quality for internet banking services. Procedia - Social and Behavioral Sciences, 65, 854-859. https://doi.org/10.1016/j.sbspro.2012.11.210

BABBIE, E. (2013). The practice of social research. 13th ed. London: Wadsworth Cengage Learning.

BARNES, S.J., & VIDGEN, R. (2003). Measuring website quality improvements: a case study of the forum of strategic improvement. Industrial Management and Data Systems, 103(5), 297-309. https://doi.org/10.1108/02635570310477352

BAUER, H.H., FALK, T., & HAMMERSCHMIDT, M. (2006). ETransQual: a transaction process-based approach for capturing service quality in online shopping. Journal of Business Research, 59, 866-875. https://doi.org/10.1016/j.jbusres.2006.01.021

BAUER, H.H., HAMMERSCHMIDT, M., & FALK, T. (2004). Measuring the quality of e-banking portals. International Journal of Bank Marketing, 23(2), 153-175. https://doi.org/10.1108/02652320510584395

BERGER, S.C., & GENSLER, S. (2007). Online Banking Customers: Insights from Germany. Journal of Internet Banking and Commerce, 12(1). Retrieved from https://www.icommercecentral.com/open-access/online-banking-customers-insights-from-germany.php?aid=38482

BLOEMER, J., & DE RUYTER, K. (1998). On the relationship between store image, store satisfaction, and store loyalty. European Journal of Marketing, 32(5/6), 499-513. https://doi.org/10.1108/03090569810216118

BOSHOFF, C., & DU PLESSIS, P.J. (2009). Services marketing: a contemporary approach. Cape Town: Juta.

BRESSOLLES, G., & DURRIEU, D. (2010). A typology of online buyers for French wine websites based on electronic service quality dimensions. International Journal of Wine, 22(4), 335-348. https://doi.org/10.1108/17511061011092393

CHAVAN, J. (2013). Internet banking - benefits and challenges in an emerging economy. International Journal of Research in Business Management, 1(1), 19-26.

DAGADA, R. (2013). Factors affecting mobile banking in South Africa. Retrieved from http://www.itweb.co.za/index.php?option=com_content&view=article&id=59154 Date of access: 1 June 2013.

DE VOS, A.S., STRYDOM, H., FOUCHE, C.B., & DELPORT, C.S.L. (2012). Research at grass roots for social sciences and human service professions. 4th ed. Pretoria: Van Schaik.

DING, D.X., HU, P.J., & SHENG, O.R.L. (2011). e-SELFQUAL: a scale for measuring online self-service quality. Journal of Business Research, 64, 508–515. https://doi.org/10.1016/j.jbusres.2010.04.007

DJAJANTO, L., AFIATIN, Y., & HARIS, Z.A. (2019). The impact of relationship marketing on customer value, satisfaction and loyalty: evidence from banking sector in Indonesia. International Journal of Economic Policy in Emerging Economies, 12(2), 207-214. https://doi.org/10.1504/IJEPEE.2019.099695

DONG, M.K. (2003). Inter-relationships among store image, store satisfaction, and store loyalty among Korea discount retail patrons. Asia Pacific Journal of Marketing and Logistics, 15(4), 42-71. https://doi.org/10.1108/13555850310765033

DU PLESSIS, F., & ROUSSEAU, G.G. (2007). Buyer behaviour: understanding consumer psychology and marketing. Cape Town: Oxford University Press Southern Africa.

FASSNACHT, M., & KOESE, I. (2006). Quality of electronic services: conceptualising and testing a hierarchical model. Journal of Service Research, 9(1), 19-37. https://doi.org/10.1177/1094670506289531

GRÖNROOS, C. (2007). Service management and marketing: customer management in service competition. London: John Wiley.

GUPTA, K.K., & BANSAL, I. (2012). Development of an Instrument to Measure Internet Banking Service Quality in India. Journal of Arts, Science & Commerce, 2(2), 11-25.

HAN, S., & BAEK, S. (2004). Antecedents and consequences of service quality in online banking: An application of the SERVQUAL instrument. Advances in Consumer Research, 31, 208-214.

HERINGTON, C., & WEAVEN, S. (2009). E-retailing by banks: E-service quality and its importance to customer satisfaction. European Journal of Marketing, 43(9/10), 1220-1231. https://doi.org/10.1108/03090560910976456

HO, C.T., & LIN, W. (2010). Measuring the service quality of internet banking: scale development and validation. European Business Review, 22(1), 5-24. https://doi.org/10.1108/09555341011008981

HOEHLE, H., SCORNAVACCA, E., & HUFF, S. (2012). Three decades of research on consumer adoption and utilization of electronic banking channels: a literature analysis. Decision Support Systems, 54, 122-132. https://doi.org/10.1016/j.dss.2012.04.010

HU, Y., & LIAO, P. (2011). Finding critical criteria of evaluating electronic service quality of Internet banking using fuzzy multiple-criteria decision making. Applied Soft Computing, 11, 3764-3770. https://doi.org/10.1016/j.asoc.2011.02.008

IACOBUCCI, D. (2013). Marketing Management, Vol. 4. Mason, Ohio: Cengage Learning.

IBRAHIM, E.E., JOSEPH, M., & IBEH, K.I.N. (2006). Customers’ perception of electronic service delivery in the UK retail banking sector. International Journal of Bank Marketing, 24(7), 475-93. https://doi.org/10.1108/02652320610712094

JAIN, R. (1997). Visual information management. Communications of the ACM, 40(12), 30-32. https://doi.org/10.1145/265563.265569

JOHNSON, M., GUSTAFSSON, A., ANDREASSEN, T., LERVIK, L., & CHA, J. (2001). The evolution and future of national customer satisfaction index models. Journal of Economic Psychology, 22(2), 217-245. https://doi.org/10.1016/S0167-4870(01)00030-7

KARATEPE, O.M., YAVAS, U., & BABAKUS, E. (2005). Measuring service quality of banks: scale development and validation. Journal of Retailing and Consumer Services, 12(5), 373–383. https://doi.org/10.1016/J.JRETCONSER.2005.01.001

KARSH, S.A., & ABUFARA, Y. (2020). The New Era of Financial Technology in Banking Industry. Journal of Southwest Jiaotong University, 55(4). https://doi.org/10.35741/issn.0258-2724.55.4.54

KENOVA, V., & JONASSON, P. (2006). Quality of online banking services. Thesis, Jönköping University.

KNOX, S.D., & DENISON, T.J. (2000). Store loyalty: its impact on retail revenue, an empirical study of purchasing behaviour in the UK. Journal of Retailing and Consumer Services, 7, 33-45. https://doi.org/10.1016/S0969-6989(98)00033-2

KUMBHAR, V.M. (2012). Reliability of “eBankQual” scale: retesting in internet banking service settings. Business Excellence and Management, 2(2), 13-24.

LADHARI, R. (2010). Developing e-service quality scales: a literature review. Journal of Retailing and Consumer Studies, 17, 464-477. https://doi.org/10.1016/j.jretconser.2010.06.003

LOONAM, M., & O’LOUGHLIN, D. (2008). Exploring e-service quality: a study of Irish online banking. Marketing Intelligence & Planning, 26(7), 759-780. https://doi.org/10.1108/02634500810916708

LOVELOCK, C., & WRIGHT, L. (1999). Principles of marketing and management. New York: Pearson Prentice-Hall.

MADU, C.N., & MADU, A.A. (2002). Dimensions of e-quality. International Journal of Quality & Reliability Management, 19(3), 246-258. https://doi.org/10.1108/02656710210415668

MALHOTRA, N.K. (2010). Marketing research: an applied orientation. 6th ed. Upper Saddle River, New Jersey: Pearson Education/Prentice Hall.

MCMILLAN, J.H., & SCHUMACHER, S. (2001). Research in education: a conceptual introduction. 5th ed. New York: Addison Wesley Longman.

NARTEH, B. (2013). Service quality in automated teller machines: an empirical investigation. Managing Service Quality, 23(1), 62-89. https://doi.org/10.1108/09604521311287669

NARTEH, B., & KUADA, J. (2014). Customer satisfaction with retail banking services in Ghana. Thunderbird International Business Review, 56(4), 353-371. https://doi.org/10.1002/tie.21626

OMBATI, T.O., MANGATU, P.O., NYAMWANGE, S.O., & NYAOA, R.B. (2010). Technology and service quality in the banking industry. African Journal of Business and Management, 1, 151-164.

ORUÇ, Ö.E., & TATAR, Ç. (2017). An investigation of factors that affect internet banking usage based on structural equation modeling. Computers in Human Behavior, 66, 232-235. https://doi.org/10.1016/j.chb.2016.09.059

PARASURAMAN, A., ZEITHAML, V., & MALHOTRA, A. (2005). E-S-QUAL: a multiple-item scale for assessing electronic service quality. Journal of Service Research, 7(3), 213-233. https://doi.org/10.1177/1094670504271156

PARASURAMAN, A., ZEITHAML, V.A., & BERRY, L.L. (1985). A conceptual model of service quality and its implications for future research. Journal of Marketing, 49, 41-50. https://doi.org/10.1177/002224298504900403

PARKER, C., & MATHEWS, B.P. (2001). Customer satisfaction: contrasting academic and consumers' interpretations. Marketing Intelligence and Planning, 19(1), 38-44. https://doi.org/10.1108/02634500110363790

PATEL, K.J., & PATEL, H.J. (2018). Adoption of internet banking services in Gujarat: An extension of TAM with perceived security and social influence. International Journal of Bank Marketing, 36(1), 47-169. https://doi.org/10.1108/IJBM-08-2016-0104

PIKKARAINEN, T., PIKKARAINEN, K., KARJALUOTO, H., & PAHNILA, S. (2004). Consumer acceptance of online banking: an extension of technology acceptance model. Internet Research, 14(3), 224-235. https://doi.org/10.1108/10662240410542652

PROMPATTANAPAKDEE, S. (2009). The adoption and use of personal internet banking services in Thailand. The Electronic Journal of Information Systems in Developing Countries, 37(1), 1-30. https://doi.org/10.1002/j.1681-4835.2009.tb00261.x

SANTOS, F. (2003). E-service quality: a model of virtual service quality dimensions. Managing Service Quality, 13(3), 233-246. https://doi.org/10.1108/09604520310476490

SAYAR, C., & WOLFE, S. (2007). Internet banking market performance: Turkey versus UK. International Journal of Bank Marketing, 25(3), 122-141. https://doi.org/10.1108/02652320710739841

SHAH, M., & CLARKE, S. (2009). E-Banking Management: Issues, Solutions, and Strategies. Hershey, Pennsylvania: IGI Global. https://doi.org/10.4018/978-1-60566-252-7

SOHN, C., & TADISINA, S.K. (2008). Development of e-service quality measure for Internet-based financial institutions. Total Quality Management and Business Excellence, 19(9), 903-918. https://doi.org/10.1080/14783360802224412

VAN RIEL, A., LILJANDER, V., & JURRIENS, P. (2001). Exploring consumer evaluations of e-services: a portal site. International Journal of Service Industry Management, 12(4), 359-377. https://doi.org/10.1108/09564230110405280

WELMAN, K.C., KRUGER, S.J., & MITCHELL, B. (2005). Research methodology. 3rd ed. Cape Town: Oxford University Press of South Africa.

WOLFINBARGER, M., & GILLY, M.C. (2003). eTailQ: dimensionalising, measuring, and predicting e-tail quality. Journal of Retailing, 79(3), 183-198. https://doi.org/10.1016/S0022-4359(03)00034-4

YOUNG, L. (2005). Marketing the professional services firm. New York: John Wiley.

ZAREI, S. (2010). Electronic service quality evaluation methods for online-banking system. International Journal of Computer Science and Technology, 1(2), 6-13. Retrieved from https://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.301.9785&rep=rep1&type=pdf

ZEITHAML, V.A., BITNER, M.J., & GREMLER, D.D. (2009). Service marketing: integrating customer focus across the firm. Boston, Massachusetts: McGraw-Hill/Irwin. https://doi.org/10.1002/9781444316568.wiem01055

ZHU, Y., & CHEN, H. (2012). Service fairness and customer satisfaction in internet banking: exploring the mediating effects of trust and customer value. Internet Research, 22(4), 482-498. https://doi.org/10.1108/10662241211251006


Refbacks

  • There are currently no refbacks.