My research proposal is written against the backdrop of e- banking in the banking industry. It focuses on the impact of e-banking on Bank customers. The proposed research would focus on HSBC customers as its case study. It is written against the backdrop of how innovation technology has affected the business environment in the banking industry. Electronic banking is one innovation of modern information and communication technology and it has contributed immensely to the growth of the banking sector globally. It has experienced explosive growth and has transformed traditional banking practices (Gonzalez et al., 2008).
E-Banking has been defined by various research writers in various contexts, this is because e- banking, involves a broad range of electronic banking services. (Daniel, 1999) defines E-banking to mean an electronic connection between the bank and its customers in order to prepare, control and manage financial transactions. According to the EBG of the Basel committee report on Banking supervision (1998, 3), It is "the provision of retail and small value banking products and services through electronic channels". Electronic banking in this proposal, E-banking will be given a narrow than generic definition, it is "the automated delivery of new and traditional banking products and services directly to customers through electronic, interactive communication channels" (FFIEC , 2003; the Symantec Global Internet Security report, 2009; K. Subrahmanyam, 2009) . The research proposal uses the HSBC customers as a case study on the divergent views towards e-banking.
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Electronic banking has come to stay and is no longer a tool for competitive advantage; it is now used world over to simplify banking procedures for both bank staffs and customers. Examples of electronic banking service include: Automated Teller Machine (ATM); cash withdrawal, Telephone Banking, Online Banking, Online Fund Transfer. HSBC offers to its customers, various internet banking services which include; Blackberry Business Banking, Offshore Internet Banking, Online Premier Banking, Overseas Transfer.
Electronic Banking has grown from decade to decade. E-banking which was once seen as ostentatious, is now a quintessential service? The history of electronic banking in the U.K dates back to 1983 when the Royal Bank of Scotland set up online Banking as it was known then, for Nottingham Building Society customers, Bank Transfers and Bill payment were part of the services it offered (Wikipedia, 2010). Since 1983 electronic banking grew rapidly and in the 1990s, it gained a lot of popularity. In 2010 January U.K electronic banking users are estimated at 53 % (Payment source, 2010).
Electronic banking has functioned in the following ways:
- Corporate customers of banks have used electronic banking as a fast means of running their companies' financial affairs.
- Individual customers on the other hand, have an alternative of cutting the supply chain of retail banking, by operating transactions through via internet rather than go through long queues, to perform their banking transactions.
- The banks have been able to reach a wide range of people, offering their services to people, world over.
The gradual changes and upcoming innovations in Electronic banking from 1995 till date has prompted mixed reaction at the different parts of the society. While writers are of the opinion that e-banking has cut off the private relationship customers have with their banks and view electronic banking has an imposition of complex services on them (Ibbotson et al, 2003). Invariably this research proposes to juxtapose the sect of the populace that hold the above view against the other consumers, who hold that electronic banking has aided efficiency in provision of financial services, through investigating current opinions of e-banking facilities, new recommendation and solutions could be identified to address the concerns of less ICT sawy customers .
This research proposal aims to analyze the merits and demerits of the information and communication technology; internet from the customers perspective, using HSBC as a case study.
HSBC holds electronic banking as a means of increasing its efficiency and providing quality service to its customers. It sees electronic banking as a tool of competitive advantage and medium for wider ways to reach customers and marketing their products worldwide.
Tansey said "HSBC has adopted a click and mortar strategy, this requires that customers' internet offerings must meet 3criterias: customers need and preference comes first, they must fit HSBC's existing distribution channels and they must be multinational in scope". (Tansey 2002)
3] ORGANISATIONAL BACKGROUND
Always on Time
Marked to Standard
HSBC Holdings PLC stands for Hong Kong and Shanghai Banking Corporation. It is a public limited liability company incorporated in England and Wales in 1990. It was named after its founding members Hong Kong and Shanghai banking corporation, which was established to aid business ties between China and Europe.
HSBC is a banking and financial service corporation with its head quarters in London. The groups' value includes outstanding customer service, prudent lending policy, strict expense discipline, strong capital and liquidity, effective and efficient operations (HSBC Website, 2010).
HSBC has 30,000 offices in 88 countries and territories in England, the Asia pacific region, the American, the Middle East and Africa. Its head quarter is situated at Canary Wharf, London and its regional headquarter in Hong Kong.
The services provided by HSBC Bank includes :
3.1 Personal Banking:
HSBC offers a wide range of financial services like personal loan, Insurance, pension panning and credit cards. The personal services could be divided into 2 categories:
Business and corporate Banking
HSBC provides financial services for small, medium and large business enterprises.
Global Banking and markets
it has a product called:
Organizations are offered online financial solution to manage their financial statement or finances generally.
The Bank HSBC offers financial management services to wealthy individuals
Financial, investment services and products are offered to the general public online (HSBC Website, 2010).
HSBC uses electronic Banking as a tool to achieve competitive advantage, as a catalyst for service distribution to customers and strategy for managing its vast network. In 1983, HSBC U.K launched its First Direct; a 24 hour Telephone Banking service. In 1999, it launched U.K's first T.V Banking service and in 2000, internet Banking was available to all HSBC U.K customers. HSBC's Success can be said to be linked, to its provision of electronic banking services globally.
4] RATIONALE FOR CHOSEN TOPIC
The fundamental reason for research on the proposed topic is due to the reason that I have written essays on HSBC Group in the past and also against the backdrop of my position as an HSBC Electronic Banking Customer. In the course of writing essays on HSBC in the past, I realized that HSBC's Critical Success Factor was its ability to strive on Electronic Banking. Upon becoming a customer of HSBC in 2009, I had mixed views on Electronic Banking Services, I certainly was overwhelmed by the ease of convenience that came along with it but I had to ponder on the cons of e-banking when I became a victim of internet fraud.
A lot of researchers have focused mostly the positive impact of electronic banking (Dhekra Azouai, 2009; Mehrdad Alipour, 2010) but this topic focuses on the consumers' perspective. I chose this topic against the backdrop of the unending academic arguments on customers' acceptance of Electronic Banking. I choose to research this area as my topic, to critically analyze the effects of electronic banking on customers and to analyze e-banking gives customers' value for money spent to get service.
5] RESEARH QUESTIONS
The research proposal seeks to exam the following basic questions: How much impact has Electronic Banking made in the banking industry in terms of customer services? What is the consumers' attitude towards electronic baking? What are the factors alienating customers from using electronic Banking Services, What are the benefits of Electronic Banking from customers perspective? What are the challenges of Electronic banking?
6] RESEARCH OBJECTIVES
The research objectives are listed below:
1. I aim to assess the customers' public acceptance of the electronic banking.
2. I seek to analyze the advantages and disadvantages of electronic banking on the industry from consumers' perspective.
3. I seek to explore the customer's perception of E-banking.
4. To evaluate the impact of E-banking banking services distribution efficiency.
The main objective of this research is to critically analyze the effect of electronic banking on the banking industry from the consumer perspective. It seeks to quantify public reaction and attitude towards online banking.
7] LITERATURE REVIEW
The research of electronic banking in the banking industry has been conducted by numerous researchers (Elizabeth Daniels, 1999; Wong, 2009; Pavlou, 2000; Paul Hewer, 2002; Adel M .Aladani, 2001). Various authors have written extensively written on online banking in banking journals. (Sylvie Laforet, Xia Oyan Li, 2005; Mukherjee and Nath, 2003).Various researchers have studied customers' acceptance of electronic banking as a delivery channel by the banking industry(Gerrard et al, 2006; Herandez et al, 2007) while some authors have researched on electronic banking in terms of cost advantage to the Banks(Nicoleta, 20009) and from the consumer perspective , e-banking allows customers to perform a wide range of banking transactions electronically at flexible times (Wong, 2009).Banks have been able to use e-banking as a channel for the distribution of their products and services, and improving customer relationship (Nicoleta, 2009). Even HSBC sought electronic banking as competitive strategy over its competitors.
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Electronic banking has made major impact on the banking industry; it has been regarded as the cheapest mode of delivery for banking services (Robinson, 2000; Arglie, 2002). It is convenience, flexible and functional, both for the banks and its customers (Johnson et al, 1995). From the consumers perspective it has reduced the stress of going to the bank physically and waiting on the queue before being served (Black et al, 2002), however there are mixed towards electronic banking. There has been more focus on Electronic Banking from the Banks vantage point (Nicoleta, 2009) than from the Customers viewpoint (Gerrard et al, 2006). Alot of attention has also been given to its advantage to The consumers (Gabner Kraevwter et al, 2008) rather than the disadvantages viewed by consumers (Yoon, 2002).
The acceptance of electronic banking by customers is affected by numerous factors .Several theories on technology acceptance have emerged but TAM has received the most attention (Lai and li, 2004; Muniruddeen, 2007). Information Technology acceptance has been a subject of much research in the past two decades (Lai and li, 2004), TAM is an acronym for Technology acceptance model. It is a model that analyzes how people have come to accept and use particular technology; it uses two variables for its analysis; Perceived usefulness and Perceived ease of use. Perceived usefulness is defined as the extent to which a person believes a particular system will increase his work efficiency while Perceived ease-of-use is how much a person believes that use of a particular system will reduce the amount of effort needed to operate it (Davis, 1989).Customers acceptance of electronic Banking has been studied using the technological acceptance method (Lai and li, 20004; Pikkarainen et al, 2004; Muniruddeen, 2007). However there are shortcomings of the TAM Model, although it is reliable it narrow and therefore inadequate to analyze customers acceptance of Electronic Banking.
Some other variables have also been used to analysis customers' perceptions and adoption of electronic banking this includes perceived risk, it is defined as a person's view of the level of uncertainty an electronic system has to offer (Cumingham et al, 2005). To know how customers assess a product or service, perceived risk will be divided into sub-groups of financial, physical, social, private, time, and performance risks (Bellman et al, 1999). Customers also accept electronic banking based on the perceived benefits that come along with it, these benefits may include lower costs, high degree of convenience and availability (Lee, 2009). There are also issues of privacy (Karjalute et al, 2002), Consumers are afraid of the safety of their personal information away from hackers and fraudsters (Hoffman et al, 1999; Yoon, 2002) . Consumers also raise their fears about internet security, some consumers are of the opinion that it is a service available to persons with higher incomes and higher net worth, as â€¦â€¦â€¦. Or person's access of internet due to economic banking must fit into the consumer's behavioral pattern (Gatignon and Robertson, 1985).
The data collection for this study would employ exploratory qualities primary data collection by Quantitative qualitative approach to data collection. There are numerous studies research on the consumers' adoption of electronic banking (Divya Singal and V.Padhumabhan, 2008; Dhekrs Azoouzi, 2009; Wong et al, 2009), thus, my study seeks to get fresh insight on customers' perspective of electronic banking.
The research proposed the evaluation approach of organizing a focus group interview where more findings and reactions towards electronic banking will be revealed. The focus group would consist of a sample of people who would give differing views on the impact and acceptance of electronic banking.
The data collection method would be a combination of the qualitative approach of the use of focus group interview for studies and the quantitative approach of the use of survey. A random sampling internet survey will be conducted in partnership with HSBC Bank. Questionnaires will be mailed to 100 HSBC E-banking customers in the U.K. The reasons I have selected this data collection method is because it obtains reliable results (Balsey, 1970), another reason for the use of survey method in my research is because it reduces bias from the participants (Kealey and Protheroe, 1996)
A focus group interview is a research methodology and a qualitative data collection approach that brings a group of consumers together to give detailed information on a product. It is a designed to obtain perception in a defined area and permissive, non- threatening environment. It is used to obtain a general overview about the subject of interest; it is used in diagnosing the potential or problems associated with a new service and generating impression of objects of interest. The participants will be selected by convenience sapling and the focus group would consist of 10-12 persons (D.L Morgan, 1996). The group interview would be conducted by a member who would guide the group but also make the interviewees comfortable so as to obtain various free-flowing group discussions for various sects of respondent.
9] DATA COLLECTION METHOD
This study proposes facilitating a focus group interview, with a representative of HSBC bank, London to obtain in-depth information on their experience with online banking over the years they have introduced it to the bank. This is to obtain the banking industry in perception on the impact of electronic banking on the banking sector, from the customers' perspective. Other participants of the interview will be a synergy of various customers; individuals will be chosen from each age group of 18-26, 27-45, 46-60 years, low and high income earners and corporate customers. The interview will be conducted face to face interview where the moderator can sense participants' body language and create a comfortable atmosphere for the participants to give their perception freely.
The interview is estimated to last for 1 hour; questions to be prepared for the interview would be open-ended questions that would cover the subject matter of topic. The moderator would also contribute to the interview and will give his views freely as well.
An internet and mail survey by means of questionnaire would be conducted. Participants of the survey would be retailed banks representatives and consumers. The survey will be developed in light of the feedback from the focus group. Questionnaires would be sent via e-mail asking questions about electronic Banking and participants will be given options to answer from. The quantitative approach of data collection would give a broad perception of acceptance or rejection of electronic banking; it will also reduce the Bias, which might result from the focus group interview.
10] DATA ANALYSIS
This study will combined qualitative and quantitative data analysis approach. Data obtained from focus group interview will be analyzed by framework analysis of familiarization, identification of thematic framework including, charting, mapping and interpretation (Richie and Spencer, 1994). The advantage of the approach is that it provides a clear sense of steps which could help to manage the larger amount and complex nature of qualitative data much more easily (Krueger, 1994).The process of data analysis would involve facilitating the discussions and generating data from the interview over and over to get details, writing, memos and ideas arising from the discussion. The data would then be sited and re-arranged.
The data collected from the internet survey via questionnaires will be organized by Excel Spreadsheet; this will be used to code the Data. The responses will be tabularized by computer and the responses will be converted into percentage and it will be stored in electronic form. This approach to analyzing quantitative data is a faster means of ascertaining results.
11] RESOURCES REQUIREMENTS
The literature review will be sourced from the British library, HSBC archive and other general sources of obtaining public information. The research would be carried out by using information and communication technology tools. I will be using search engines like Google scholar, Google, Ask.com, Wikipedia and Emerald.
The facilitation of the field work will involve enormous use to internet facilities and visits to social groups, to gather opinions on the proposed topic. The focus group interview will also require a conducive environment for the face to face interaction.