AN EMPIRICAL STUDY ON ADOPTION OF THE MOBILE BANKING SERVICES IN AHMEDABAD CITY

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1 AN EMPIRICAL STUDY ON ADOPTION OF THE MOBILE BANKING SERVICES IN AHMEDABAD CITY MR. MIHIR B. CHAVDA Research Scholar, School of Management, R K University, Rajkot DR. ASHVIN SOLANKI Assistant Professor, Department of Business Management, Saurashtra University, Rajkot ABSTRACT Mobile banking has observed a tremendous growth in last few years. This paper primarily covers the adoption of mobile banking services by the customer resides in Ahmedabad city. Nowadays, numbers of mobile banking users are growing tremendously; reason remains smart phones, as market has been captured by smart phones because of the affordable cost and multiple functions. People use smart phone functions to different services, ranging from connecting social media to check useful work . Smart phones available in the market operate on different platforms like androids OS, blackberry OS, ios and windows OS. We analyzed that does different platforms make any impact on adaptability of mobile banking services, and found that most users prefers Android platforms and satisfaction depends on the operating system used by the customer. Finding also showed that most of the people who are using mobile banking service are very satisfied with the services and security features. Research also showed that people who are highly educated and falling under the high income group but it has no impact on the mobile banking services. Main reason behind adoption of mobile banking services being the customer competency with the mobile phones. KEYWORDS : Mobile banking, Innovative Banking, Internet banking. INTRODUCTION Information technology has been growing very rapidly in the last few decades. There is no area which has been left untouched by the information and communication technology. Nowadays banking industry faces one of the important challenges for mobile banking service offering, the major reason is that number of mobile users in India has surpassed computers and laptops mainly for the youngsters, there were 364 million rural mobile phone users in India as of Jan. 31. Indian companies spent 3 billion rupees ($49.9 million) on mobile ads last year, and the market is projected to expand 43 percent this year, according to the Mobile Marketing Association. Not only private banks adopted the mobile banking service but even government banks have also adopted the mobile banking channel to provide services to their customer and to reduce transaction cost. Major issue arising from the increasing number of mobile users is that which kind of features and facilities should be provided to customers so that they motivate to use mobile banking services. Another challenge is the security and privacy issues consumers face in mobile banking devices. The reason which motivates banks to offer mobile banking service to customer is efficiency of banking operation and competitive advantage over other banks. The major factor for adoption of mobile banking services such as perceived risks and worth of using it. However, customer tends to evaluate the difficulty of operating and features provided by the banks. LITERATURE REVIEW There are so many studies have been taken place on the mobile banking services in last few years. Mobile banking being the very important channel for online banking transactions, we have to look the study from the different perspectives. The focus of literature has been divided into the different categories. Behavioral intentions towards mobile banking, retail versus corporate mobile banking users, security threats in mobile banking, benefits of using mobile banking and barriers to adoption of mobile banking Behavioral intentions towards mobile banking While behavioral intention drives the mobile banking usage. Siddhartha (2011) has done some useful research on the perception of Indian customers towards mobile banking services. Perceived image towards usage of mobile banking showed the most significant impact on behavioral intentions towards mobile banking. Interesting finding by the author is that perceived risk did not have a significant impact on behavioral intentions towards mobile banking. Perceived usefulness and perceived ease of use are the important factors for behavioral intentions of using mobile banking. They have also studied that banks should design their mobile banking after learning psyche of the customers. Nov-Dec vol. 1 issue 1

2 Mobile banking users: Retail versus corporate clients Extraordinary features, the ease and accessibility that make mobile banking so attractive to consumers are unnoticed by the corporate practitioners. Laura (2011) researched that companies seek to work smarter and more efficiently. For that purpose companies and businessman can use mobile banking for their business related transaction. Banks can save time of companies by providing most critical, timely information on the go. With a smartphone, tablet or other mobile device, users can communicate transaction decisions and authorizations anywhere. Author explores the growth in mobile and compares differences and similarities between consumer and corporate mobile banking, including small businesses. Security threats in mobile banking Smartphones are everywhere, and they are carrying vital corporate data, whether they are secured or not. Ericka (2010) found that with the exposure of ipad owners' personal data recently, along with new reports that highlight Android security problems, opportunities abound for channel partners that can create a mobile-security practice for business customers. With the number of mobile devices deployed shooting up, recent news about Android security vulnerabilities and the exposure of ipad users' personal data raising user awareness about mobile security, opportunities for channel partners to sell mobile protection into customer environments have certainly ripened. That's if these partners and their vendors can target the mobile risks that matter, security experts believe. The truth is that security vendors have long been proclaiming that mobile malware would soon overwhelm enterprises once mobile devices established critical mass. Benefits of using mobile banking The growth of mobile banking is extraordinary, especially when we compare it with the previous delivery channels. Lisa (2011) found that it took almost 20 years for ATM to penetrate into the market; online banking took a decade, while mobile banking penetrated in just 5 to 6 years. The majority of large banks in India already offer mobile services. Dag(2013) found that Mobile, new technology and Big Data are now changing the payments landscape. A silent revolution is under way, which will change retail banking as we know it. Mobile is now bringing together the digital and physical worlds, and radically changing consumer behaviour and expectations. The customers are in the driving seat, deciding what, where and when they want services to be available. For banks, this mobility revolution creates challenges, but also opportunities. New players such as Google, Apple, PayPal, mobile operators and technology companies have already entered the arena. Though the reasons for them to engage in the payments area are more than one, probably the most important factor is the increasing importance of Big Data and how service suppliers in this digital age can leverage information and create superior customer engagement. It is well known that payments are one of the most important and richest sources for such information. Barriers to adoption of mobile banking The wireless technology and the large penetration of mobile devices have created tremendous business opportunities via the wireless infrastructure. Sindhu (2010) found that these opportunities are in terms of communications, transactions, purchasing, trading etc. Mobile banking is a channel whereby the customer interacts with a bank via a mobile device, such as a mobile phone or personal digital assistant (PDA). There is vast market potential for mobile banking due to its always-on functionality and the option to virtually bank at anytime and anywhere. The market for mobile phones and handheld devices is exploding given the low costs, increasing computational power and ease of use. Even though technology and applications for these services are available, the usage international rates have been low. What factors drive customers to accept new payment solutions or inhibit them from doing so, or how should solution providers manage the penetration of their payment solutions among customers have received surprisingly little attention. The objective of this paper is to explore the major factors which influence the intention to use mobile banking OBJECTIVES OF THE STUDY The main objective behind writing research paper is to contribute something to the innovative products of the banking sector. Mobile is owned by most of the people while laptop or computer owners are very less. If we take mobile banking as the major access point for internet then it provides very good insight into the banking innovative products. Various objectives of the study are: 1. To check the customer satisfaction level of the mobile banking with different demographic variables. 2. To explore the major factors influencing the intention to use mobile banking services. 3. To check customer preferences for different banking services while they operate through mobiles. 4. To compare mobile banking services with the traditional banking services. 5. To access different types of transaction that can be taken place through mobile banking. RESEARCH METHODS To check the adoption level of the mobile banking, I have used the descriptive research and causal research to explain the data. I have collected primary data by using the questionnaire and for the secondary I have used different literatures. I have collected data Nov-Dec vol. 1 issue 1

3 from the 202 respondents of Ahmedabad city to establish the meaningful relationships between the different variables. My survey revolves around adoption of the mobile banking services. DATA ANALYSIS Data analysis for the adoption of mobile banking has been done by using the SPSS software. For the analysis Chi-Square test has been used. Sampling method is nonrandom convenience sampling. Operating System Operating System versus Operating System and H0: User s satisfaction for the mobile banking is independent of the operating system used by the customer. H1: User s satisfaction for the mobile banking is dependent of the operating system used by the customer. Apple ios Windows Android Other Pearson Chi-Square a derived p value is which is less than 0.05 so we not reject the null hypothesis and conclude that User s satisfaction for the mobile banking is dependent of the operating system used by the customer. Security satisfaction versus overall satisfaction Security features and mobile banking satisfaction H0: User s satisfaction for the mobile banking is independent of the security features provided by the bank. H1: User s satisfaction for the mobile banking is independent of the security features provided by the bank. Satisfied With Security Features Highly Satisfied Satisfied Neutral Pearson Chi-Square a derived p value is which is greater than 0.05 so User s satisfaction for the mobile banking is independent of the security features provided by the bank. Educational qualification and mobile banking services comfort for payments. Nov-Dec vol. 1 issue 1

4 H0: Ease of using mobile banking services and educational qualification are independent. Educational Qualification H1: Ease of using mobile banking services and educational qualification are dependent. Educational Qualification versus Comfort for Mobile Banking Comfort for Mobile Banking Very Comfortable Comfortable Neutral Total Undergraduate Graduate Post-Graduate Professional Degree Other Total Pearson Chi-Square a Type of account and mobile banking satisfaction derived p value is which is greater than 0.05 so H0: Mobile banking satisfaction does not depend on which type of account customer is operating. Ease of using mobile banking services and educational H1: Mobile banking satisfaction depends on the qualification are independent. customer s account type Type of Account versus overall satisfaction Type of Account Savings Account Current Account Pearson Chi-Square a derived p value is which is less than 0.05 so we do reject the null hypothesis and conclude that Mobile banking satisfaction depends on the customer s account type. Monthly Income Monthly Income versus Mobile Banking Preference Check A/C balance Income and mobile banking service preference H0: Mobile banking service preference is independent on the income level of the customer H1: Mobile banking service preference is dependent on the income level of the customer Transfer of Payments Most Preferred Service Online Products Information Utility Payments Online Shopping < More than Total Nov-Dec vol. 1 issue 1 Total

5 Pearson Chi-Square a derived p value is which is greater than 0.05 so Mobile banking service preference is independent on the income level of the customer. Smart phone users and mobile banking services comfort for payments H0: Comfort level for using mobile banking service is independent of the People who are using smartphones for the longer period H1: Comfort level for using mobile banking service is dependent of the People who are using smartphones for the longer period No of years for using smartphones and comfort for mobile banking Mobile banking comfort Very Comfortable Comfortable Neutral Total <1 Year to 2 years No of years for smartphone using 2 to 4 years More than 4 years Not using Total derived p value is which is greater than 0.05 so comfort level for using mobile banking service is independent of the People who are using smartphones for the longer period. Age Group Pearson Chi-Square a Age group and mobile banking satisfaction H0: Mobile banking satisfaction is independent of the customer s age group H1: Mobile banking satisfaction is dependent of the customer s age group Age Group and Overall Mobile Satisfaction Overall Mobile Satisfaction < Pearson Chi-Square a 6 0 derived p value is which is less than 0.05 so we do reject the null hypothesis and conclude that Mobile banking satisfaction is dependent of the customer s age group. Occupation and mobile banking satisfaction H0: Mobile banking satisfaction is independent of the user s occupation H1: Mobile banking satisfaction is dependent of the user s occupation Nov-Dec vol. 1 issue 1

6 Occupation Occupation versus overall satisfaction Student Housewife Salaried Businessman Professional Other Pearson Chi-Square a derived p value is which is less than 0.05 so we do reject the null hypothesis and conclude that Mobile banking satisfaction is dependent of the user s occupation. Age group and satisfaction with security features H0: Satisfaction with the security features is independent of the age group of the customer. H1: Satisfaction with the security features is dependent of the age group of the customer. Age Group Age Group versus security satisfaction Security Satisfaction < Total Pearson Chi-Square a derived p value is which is greater than 0.05 so Satisfaction with the security features is independent of the age group of the customer. Income group and satisfaction with security features H0: Satisfaction with the security features is independent of the income of the customer. H1: Satisfaction with the security features is dependent of the income of the customer. Monthly Income Monthly Income versus security satisfaction Satisfaction with Security Features < More than Total Nov-Dec vol. 1 issue 1

7 Pearson Chi-Square a derived p value is which is greater than 0.05 so Satisfaction with the security features is independent of the income of the customer. CONCLUSION From the research it has been found that mobile banking satisfaction is dependent on the age group and occupation of the customer. For the study 66 percent males and 34 percent females have been analyzed. Maximum customers are using mobile banking falling into the age group of 18 to 40, and these customers are independent of the security features satisfaction. Mobile banking is mostly preferred by the Graduates but while we test it with hypothesis it has been observed that ease of using mobile banking service and educational qualifications are independent. Maximum customer using mobile banking falling into the income group of to and customers are independent of the security features provided by the bank. Customers who are having relationships with the bank for a longer period are more satisfied with the mobile banking. Maximum customers are using SBI as their primary bank. Age group and overall satisfaction of mobile banking are dependent so moving from one age group to another can having impact on the mobile banking service satisfaction level of the bank. Security features provided by the banks does not have any impact on the mobile banking satisfaction. Customers are using smart phone for a longer period and mobile banking preference does not have any impact on satisfaction. Nowadays, Smartphone become very popular so mobile banking is preferred by more customers. I advice various incentives to be provided to the mobile banking users for growth in the services otherwise there is a huge potential for the mobile banking market. There are so many types of transaction like utility payment, fund transfer, online shopping etc.has been taken place through mobile banking, but most of the customers are using mobile banking services for the balance check facility and other facilities offered by banks are not as much popular. Most of people selected mobile banking services as they get information in seconds and they found mobile banking as a convenient way of managing services. Customers are very much satisfied with the Mobile banking compared to traditional banking as they are very much satisfied with service offerings. BIBLIOGRAPHY 1. Dag-Inge Flatraaker. (2013). Mobile payments changing the landscape of retail banking: Hype or reality? Journal of Payments Strategy & Systems, 7(2). 2. Ericka Chickowski. (2010). Mobile Security: Four Key Opportunities for the Channel.Ziff Davis Enterprise Holdings Inc. 3. Huei Lee., Yu Zhang., & Kuo Lane Chen. (2013). An Investigation of Features and Security in Mobile Banking Strategy. Journal of International Technology and Information Management, 22(4). 4. Michelle Darsow., & Laura Listwan. (2012). Corporate practitioners moving to mobile banking: Key factors driving adoption. Journal of Payments Strategy & Systems,5(4). 5. Lisa Valentine. (2013). MOBILE BANKING: Seven keys for success. ABA BANKING JOURNAL. 6. Prof. Mallika Mathew., Dr. M. M. Sulphey., & Mr. Jithin Prabhakaran. (2014). Perceptions and Intentions of Customers towards Mobile Banking Adoption. The Journal Contemporary Management Research, 8(1), SIDDHARTHA Dasgupta., RIK Paul., & SANJAY Fuloria. (2011). Factors Affecting Behavioral Intentions towards Mobile Banking Usage: Empirical Evidence from India. Romanian Journal of Marketing, 6(1), Sindhu Singh., Vivek Srivastava., & R.K.Srivastava. (2010). Customer Acceptance of Mobile Banking: A Conceptual Framework. SIES Journal of Management, 7(1), Small feature, big WOW Mobile check capture could help banks usher in mobile 2.0. (2011). ABA BANKING JOURNAL. 10. Wisal tingari., & Abadir mohamed mahmoud. (2014). An empirical study evaluating the adoption of mobile banking in sudan. journal of internet banking and commerce, 19(2). Nov-Dec vol. 1 issue 1