E Banking Influences the Customer Satisfaction


Customer satisfaction proves to be significant for the never-ending survival of the organization in the globe. Technology has been proven to play a major role in the present times. Internet has revolutionized the overall banking industry. Changing from manual ledger-based ledger system to systemized methods along with approach to the internet-based facility has offered a new aspect to the banking sector of the globe. There has been rise in the level of competition in the banking sectors and thus in order to retain competitive it has been noticed that banks are making use of new tool and techniques so that they can easily retain the customers and satisfy them. E-banking can be considered as one of the most significant tools. Electronic banking can be considered as the mechanized offering of the new or old banking products that is provided directly to the customers by means of interactive communication channels. E-banking proves to be of great importance in meeting the anticipation of the user (Agarwal, Krishna& Chekitan 2003). It is by means of customer satisfaction; the banking sectors can attain high quality services. It can be revealed that there are basically four types of e-commerce activities that are performed by internet user which demands banking relationships are classified as banking, investing, shopping and online electronic payment for the internet services. The rise in the internet activities is altering the ways in which business houses tends to interact with consumers because most of the business in the present times tends to be performed through internet services. Internet banking can be considered as the electronic payment system thereby permitting the customers of the financial institutions to perform different financial transactions over the website that is operated by institution such as credit union, virtual bank and retail bank and so on. Such a new channel has led to new dimensions towards the concept linked with customer satisfaction and the way it tends to impact in a positive manner. It can be revealed that there are different factors that tend to possess an impact over the customer satisfaction where one of them has been linked with the service quality.


The chief objective of this report has been to demonstrate the role played by e-banking to attain customer satisfaction. It also tries to assess the need to enhance the service delivery method basically for the e-banking clients. The study in short tries to ascertain the e-banking trends, understanding of the level of customer satisfaction in distinct geographical locations. The research question that this study intends to answer has been detailed below:

How does e-banking influence the customer satisfaction?

Considering this question, several other questions have also been framed such as what the level of customer satisfaction in distinct geographical locations is.

Is there any connection between service outages and customer patronages of e-banking services?

It can be revealed that the chiefpurpose of conducting this study has been linked with adding the prevailing knowledge into the electronic banking field of the study. The study intends to contribute towards assisting the banks and policy makers towards proper understanding of the internet banking dimensions and their contribution towards customer satisfaction.

As per Abukhzam & Lee (2010) huge progress has been made in the field of information technology and it has minimized the world to global village and led to huge changes in the banking industry. It is because of the development in the technology of telecommunication along with electronic data processing that has led to such changes. Those businesses that cope with such matters shall survive. Competition demands effective and less costly products and services. Most of the customers demand quick services. In the past, large queues were observed for payment of the utility bills or for the purpose of cash withdrawal/ deposits in banks. The banks have been capable of succeeding in minimizing the queue by making use of the latest technology. However, the common people are demanding more of less time-consuming methods for the purpose of banking transactions (Kampakaki & Papathanasiou, 2016). Under such circumstances, it is to be noted that the banks need to make use of the internet facility for consumer’s transaction. This process shall minimize the overall paperwork and shall offer the customers with quick response when they are at their office or home. It can be identified that financial service industry was the first one to determine the capabilities of the Internet to interact with the customers. Nonetheless, the present data that has been compiled by the Web marketing Association tends to demonstrate the fact that banks are found to fall behind other industries in relation to innovation of the internet channels. One of the significant roles played by E-banking has been that it is available all day long and 7 weeks in a day. It is mainly the customer perception and the lifestyle that has a major role to play for the development of the internet banking systems. It has been noted that the banking sector has been undergoing tremendous changes in the form of innovative utilization of the information technology along with the creation in electronic commerce. Such a development has led to huge threats to the traditional branch operations, even though there is growth in the ecommerce continuously (Rangsanand Titida, 2013). The significance of the electronic payment system in the country might not be over emphasized because of the alterations in the technological advancements that the global financial institutions tend to face regularly. It can be argued that such new technological developments would lead to digital money reinstatingfiduciary currency in certain developed countries.

It can be revealed by Ahire, Golhar & Waller (1996) that there are six dimensions of e-banking service quality: feedback, complaint management, queue management, efficiency, accessibility, and customization. It can be revealed that internet banking can be considered as the innovative distribution channel thereby offering less waiting time along with huge spatial convenience in comparison to conventional branch banking with lower cost structure in comparison to traditional delivery channels. One main advantages of the internet banking have been related with the fact that it minimizes the marginal operational costs to the bank. It also leads to huge degree of the customer satisfaction as well as retention. Internet banking proves to be quite attractive for the banks as well as consumers who tend to possess huge acceptance to new technology. It can be revealed that the internet banking permits the banks to provide low cost along with high value-added financial services. According to US web corporation it can be argued that the banks understand the fact that an adequate online banking strategy is required for success in competitive financial service market. Alteration in the technology, competition along with lifestyles has completely altered the face of banking (Kampakaki& Papathanasiou, 2016). Banks in the present environment tends to look for different methods to offer differentiated services.

As opined by Allen & Meyer (1990) there are different academic studies that tend to be helpful in considering the problems of the provision of electronic transactional services by the banks. It is due to the impact of the major trends such as technology as well as deregulation that has forced the banking sectors to pay attention towards distribution channel strategies. It has been estimated that the total number of people visiting the branch for the purpose of transaction would fall while on the other hand, there would be rise in the total number of alternative delivery channels. Such channels would possess different advantages such as convenience, sales, lower cost, and orientations. E-banking has led to virtualization which implies the removal of the constraints of time, form and time that is possible by the convergence of the telecommunication, visual media (Fakhraddin, 2013).

There are basically three types of direct delivery means such as telephone, PC and WWW. It has been identified by Anderson & Weitz (1992) that all these needs to be implemented in a complementary as well as integrated manner with the prevailing distribution channels in case the providers of the financial services would prevail in the coming decade. It can be revealed by Bagozzi & Edwards (1998) that enhanced customer access, providing of services, increased customer loyalty, luring of new customers can be the main drivers of internet banking. It is to be noted that mobile banking would be more popular in the coming years in comparison to visiting high street bank branch thereby demonstrating the way the technology would alter the ways in which British would bank. The most turning points would arrive in the year 2021 when the overall customers regularly making use of the branches shall be overtaken through those apps. Both mobile as well as internet banking has been well spread in UK. Most of the adults in UK are making use of the online banking services and near about 48% of the people made use of the mobile banking services in the year 2018 as stated by UK finance. It can further be estimated that near about seventy one percent of the customers are expected to make use of the mobile apps for the purpose of banking by the end of the year 2024. However, in the same period, it is expected that the total number of customers banking in braches would decline by 55%. In the recent times, some of the startup banks that are not operating through branches such as Revolut, Monzo, Starling and N26 have been found to attain license for the purpose of offering different types of banking services (Fakhraddin, 2013). Owing to the increasing number of users it has been identified that the traditional banks have been forced to spend huge money in technology. With the decline in the branch banking, several analysts have raised concerns regarding the fact that some customers basically the older ones might easily lose out. It can however be argued that though digital banking is on the rise, there is huge appetite for dedicated bank branches offering complete range of the financial services to the customers along with access to cash. In the year 2017, it has been found that debit cards overtook cash as being one of the best payment methods in the context of UK. Nonetheless, the point worth stating here is that near about 1.3 m adults and over 85s do not possess a bank account or any types of e-money initiatives. The rapid changes in the technology would continue in the coming times because people would make use of different types of payment methods and thus manage their accounts according to their needs and lifestyles.

According to Sharma (2011) there are two types of business models to offer the online banking facilities to the customers. One of them has been linked with incumbent bank which is also determined as the bricks and clicks model that tends to apply online banking as its improvement to the traditional banking sector and thus integration of the branches, call centers and online service into the entire system and thus making use of the e-banking as one of the method for delivering services. The other business model is identified as direct bank or the virtual banks that does not possess any types of branch offices but tends to make use of the internet, telecommunication network and wireless networking to offer banking services.


According to Ganesan & Vivekanandan (2009) internet is a competitive and technologically developed market leading to huge challenges for the banks to maintain relationship with the clients. Trust as well as security has attained huge attention in marketing literatures because of the major influence that it possesses on attaining long lasting as well as profitable association. It issignificant aspect while providing the electronic services in e-commerce environment basically at times that involves user’s activities such as e-banks. Trust can be considered as one of the major challenges for the internet banking along with other electronic commerce that tends to comprise of sensible information. It can be revealed that there are different factors that shall possess an impact on customer trust in the context of online banking services. The different components of trust basically in the online banking are trusting beliefs, institutional based trust, perceived site quality and familiarity.

Service quality

As per the views of Barrett (2007) there are different types of competitive advantages that has been linked with the implementation of the technology in the service organization that shall comprise of improvement of the level of outputs, development of the entry barriers along with rise in the revenue creation from the new types of services that is being offered. With the development in information and communication technology, banks have attained a platform through which they can design, deliver services and develop products that can be perceived as superior by the customers while making use of the online channels for the purpose of banking transactions. It can be considered as one of the most significant aspects in the banking business (Fakhraddin, 2013). Customers tends to consider the quality of the services of online banking as per the performance of the online delivery systems and not on the methods through which the delivered services are created. It is significant for the business houses to determine the fact that web experience would present brand positioning to the online consumers and can be one of the significant components in the development of the trust as well as relationship with the customers. Online service quality can be considered as the function of six main elements such as ease of use, accuracy of the content, aesthetics and privacy, content, and timeliness of response. There are basically four dimensions such as website design, privacy, customer service and reliability to be the main predictors of customer satisfaction as well as commitment (Rangsanand Titida, 2013). Hence, constant development in the information technology has assisted the banks to offer services in a proper manner for adjusting their products with that of the needs and demands of the customers.

It can be revealed that first direct is one of the few worldwide in order to offer full range of banking products such as home loans, investments and insurance. At Finn bank, it is noted that the customers can make use of the phone in order to open an account, make deposits, track spending, issue checks and thus set savings plan. Users are also capable of rating the transactions, the notable features of digibank in UK has been that it has eWallet facilities, mobile investments, an AI-powered virtual assistant, digisavings and so on. Hellobank can be considered as one of the biggest and sophisticated digital banks in Europe that tends to offer current account, brokerage services and savings thereby catering to other needs of the individuals in digital arena. It can be revealed that at Bank of England, there is 24-hour banking facilities that can be availed through web browser. The activities are confidential and secured. The bank tends to offer different services to the customers such as managing their accounts and review their loans, view and print bank statements, check re-orders, calculators, fund transfers and loan payments. In order to satisfy the customer, Bank of England, also makes use of OneClick Bill Pay which is considered to be simple, fast and secure method for paying bills (Bank of England, 2020).

As revealed by Patil (2012) in the recent years, the development of e-channels has led to alterations in the rules and operation in banking industry. It has been identified that while the industry has tried to deploy and offer new banking services through e-channels for customers and in turn the e-banking services have boomed rapidly. In the present times different financial institutions are trying to place emphasis upon the customer-oriented services. Hence, it is because of such reasons, it becomes quite important for the companies to develop proper relationship with the customers. In studying the impact of customer satisfaction over customer’s behavioral responses, it has been found that when customer evaluated customer satisfaction is high, they would prefer to stay with the prevailing service provider or would control their negative behavioral intentions. Customer satisfaction tends to possess a strong positive relation with word-of-mouth communication. It is significant to develop different strategies for improving the behavioral responses to customer satisfaction (Tasmin, Alhajiand Josu, 2012). The strategies might comprise of preventing the service issues from taking place, meeting customers desired service levels and resolving issue effectively as they take place and dealing with the complaints in an effective manner.

According to Rahman (2004) perceived value, cost effectiveness, care with punctuation ease of utilization, problem handling, convenience, responsiveness, and brand perception can be considered as the most significant factors in the context of customer satisfaction in e-banking. It is well known fact that contact facilities, fulfillment, compensation, efficiency, and systems availability are less significant dimensions and they tend to explain 21.20% of the variance in customer satisfaction. The different predictors of the perceived value in e-banking are efficiency, responsiveness, cost effectiveness, problem handling, compensation, and security. Hence, it can be revealed that it is significant for the bankers along with e-banking service designers to contemplate regarding such dimensions and thus lead to possible alterations in the e-banking services thereby meeting the demands and expectations of the customers. This shall assist in improving the quality of service of e-banking and escalate the degree of customer satisfaction in e-banking. In the present times most of the banks are making use of the ICT to improve the service quality (Tasmin, Alhaji&Josu,2012).

It has been argued that most of the banks want to invest in ATMs for minimizing brand cost because customers prefer to make use of them rather than branch to transact the business.

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Research methodology

The choice of the most adequate set of research methodology can be considered as significant tasks of the researchers in conducting a research study. Failure to choose a proper research methodology would render the efforts of researchers in vain and would make the research fail to attain the objectives. Research philosophy is associated with source, development, and source of knowledge. One of the main objectives of the research study has been linked with the development of the knowledge and successful completion of the study demands researchers to determine the philosophical views as well as assumptions that has been based upon the facts how researchers tends to conceive the world. It can be revealed that component of research philosophy tends to be divided into three main paradigms such as positivism, pragmatism as well as interpretivism. This research study intends to make use of interpretivism research philosophy becausethe study is qualitative in nature.

Research approach

Till date there are basically two types of research approaches such as inductive research approach and deductive research approach. Inductive research approach comprises of collection of the data that is relevant to the study from distinct sources to create new theory. This method proves to be apt for the qualitative research. On the other hand, deductive research approach tends to be suitable for the purpose of quantitative research approach and is dependent on the survey method. This study is qualitative in nature and thus inductive research approach shall be followed. It shall explore different literatures and theories to attain the research objectives.

Research methods

Selection of the adequate research method can be considered as one of the most significant aspects that need to be considered while performing a research study. There are two types of research study such as quantitative research method and qualitative research method. Qualitative research methods tend to be apt for the researchers aiming to explore certain phenomenon. Quantitative research methods make use of the statistical tools and leads to numerical findings. This study intends to make use of the qualitative research methods because the study demands in depth analysis of the impact of e-banking over customer satisfaction.

Research design

It becomes quite significant for the researchers to ensure the fact that research undertaken leads to prevailing knowledge and the inferences that has been identified from the study is quite reliable. It becomes quite significant to choose the best research design. There are three types of research design such as exploratory, descriptive, and explanatory. A research study can be stated to be explanatory in nature as it comprises of relationship taking place between two or more than two variables in the study. On the other hand, research is exploratory research and is linked with discovering different theories that has not been identified in the literatures. Descriptive research tends to be dependent on offering detail understanding as well as knowledge in relation to the event. This study is largely descriptive in nature and it also comprises of investigation of impact of e-banking facilities over customer satisfaction.

Research strategy

Determination of the research strategy can be considered as the most significant to ensure the successful completion of the research and to ensure the credibility. The research strategy tends to offer idea regarding the ways in which researcher tries to address the research question. There are commonly applied research strategies such as experiment. Survey, archival research, action research, interview, focus group and case study, among others. Owing to the fact this study is qualitative in nature, it is best to make use of the interview method. Interview as qualitative research strategy has been chosen because it tends to lead to attainment of the data in the form of participants opinion and it also tends to improve the rate of responses. Semi structured interviewing techniques would be chosen to collect the qualitative data because this method assist in attaining information from persons that has been based upon their opinions over topics.

Data Sample and Sources

To collect the data, the researcher shall make use of both primary and secondary data collection methods. The primary data shall be collected by approaching managers of 5 different banks in UK in order to conduct face to face interview and understand the ways in which the e-banking tends to have an impact over the customer satisfaction level. Ten different questions would be asked to the managers of the banks for attaining the answer to the research objectives. Secondary data shall be collected by means of reviewing the literatures of different scholars who have researched on similar topics as that of this research paper. Different websites that shall be useful in the research are Bloomberg, bank scope and so on.

Conclusion and recommendations

Electronic delivery has been identified to become a major distribution channel for the retail banking in the coming years. It has been identified that most of the banks in UK are already providing online transactional services to consumers in their homes. It can be identified that the decision to implement the electronic banking tends to be led by corporate vision of future where the banking market tends to become quite competitive while the consumers wants functionality, services at lower price, greater accessibility. Different electronic channels such as PC and digital TV would become significant means to satisfy these competing challenges. In the near times, managers would face different challenges such as integration with the prevailing distribution channels, increased competition level because of new entrants, pricing of the electronic services. It has been identified that it is quite important to offer the customer with maximum choice as well as convenience. One main challenge for the managers and an area for further research would be to comprehend the service characteristics that shall hinder customer acceptance of such services.

Though this study tends to reveal different aspects of customer satisfaction and customer commitment in internet banking in UK, there is still room for future research to enrich the online banking services in UK. It can be recommended that rather than paying attention towards banking sector, the broader concepts of online services needs to be paid attention. Future research needs to consider comprehensive analysis of branch and online banking systems. Comparison between prevailing users and persons wanting to make use of the internet banking needs to be made in the future study.


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Agarwal, S., Krishna M. E. & Chekitan D. D., 2003. Market orientation and performance in service firms: Role of innovation. Journal of Service Marketing, Vol.17, No. 1, pp. 68-82.

Ahire, S., Golhar, D. & Waller, M., 1996. Development and validation of TQM implementation constructs. Decision Sciences, Vol.27, No. 1, pp. 23-56.

Allen, N.J. & Meyer, J.P., 1990. The measurement and antecedents of affective, continuance and normative commitment to the organization. Journal of Occupational Psychology, Vol. No. 63, No. 1,pp. 1-18.

Anderson, E & Weitz, B., 1992. The use of pledges to build and sustain commitment in distribution channels. Journal of Marketing Research, Vol. No. 29, No. 11,pp.18- 34.

Bagozzi, R.P. & Edwards, J.F., 1998. A General Approach to Construct Validation in Organizational Psychology: Application to the Measurement of Work Values. Organizational Research Methods, Vol. No. 1, No.2, pp. 45-87.

Barrett, P., 2007. Structural equation modeling: Adjudging model fit. Personality and Individual Differences, Vol. No. 42, No. 5, pp. 815-24.

Fakhraddin, M., 2013. Factors Affecting Customer Loyalty of Using Internet Banking in Iran. World Applied Sciences. Journal on internet banking, Vol. No. 28, No. 11, pp. 1685-1693,

Ganesan R. & Vivekanandan K., 2009. A secured hybrid architecture model for internet banking (e-banking). Journal of Internet Banking and Commerce, Vol.4, No. (1), pp. 1- 14.

Irny, S.I. and Rose, A.A. (2005) “Designing a Strategic Information Systems Planning

Methodology for Malaysian Institutes of Higher Learning. Issues in Information

System, Volume VI, No. 1.

Kampakaki, M. & Papathanasiou, S., 2016. Electronic – Banking and Customer Satisfaction in Greece. The Case of Piraeus Bank. Annals of Management Science, Vol. No. 5, No. 1, pp. 55-68.

Patil, N. U., 2012. Internet banking in India: Risk analysis and adoption in an emerging economy. Indian Streams research Journal, Vol.2, No.3, pp. 1-4.

Rahman, Z., 2004. Developing customer-oriented services: A case study. Managing Service Quality, Vol. No. 14, No.5, pp.426-435.

Rangsan, N. and Titida, N., 2013. The Impact of Internet Banking Service on Customer Satisfaction in Thailand: A Case Study in Bangkok. International Journal of Humanities and Management Sciences (IJHMS), Vol. No. 1, No. 1, pp. 22-34.

Sharma, H., 2011. Bankers perspective on e-banking. National Journal of Research in Management, Vol.1, No.1, pp. 71-85.

Tasmin, R, Alhaji, A. and Josu, T., 2012. A Review of the Influence of Electronic Banking Services on Customer Service Delivery: Successes and Challenges.Australian Journal of Basic and Applied Sciences, Vol. No. 6, No. 13, pp. 80-85.


When I was given this coursework assessment research report regarding the influence of e-banking influences upon the customer’s satisfaction than I was uncertain that if I will be able to meet the requirement of the assignment. However, I decided to regain my confidence and at the initial phase, I made the timetable chart and planned my whole work. I started my work as per the timetable and tried to complete it within stipulated timetable. I spend majority of my time upon Introduction and Research methodology chapter wherein it has analyzed methods and approaches used in this study. In the mid-while I even went through various journals and academic articles and papers to attain knowledge regarding the research topic. In this whole coursework, I got to analyze that I have time management skills wherein I completed my work a week prior to deadline which have helped me to review every minute details in-depth. Good communication skill has also helped me in completing this work effectively. However, this work has made me realize that I do not have good researching skills as I had faced lots of issues while researching the data for the coursework. Nevertheless, I will work over my weakness and will further enhance my strength to excel in future.

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