Chapter 1

Introduction
E-banking:Internet banking (or E-banking) means any user
with a personal computer and a browser can get connected to his
bank -s website to perform any of the virtual banking functions. In
internet banking system the bank has a centralized database that
is web-enabled. All the services that the bank has permitted on
the internet are displayed in menu. Any service can be selected
and further interaction is dictated by the nature of service. Once
the branch ofices of bank are interconnected through terrestrial
or satellite links, there would be no physical identity for any
branch. It would a borderless entity permitting anytime, anywhere
and

anyhow

banking.

The delivery channels include direct dialup connections,

private networks, public networks, etc. with the popularity of
computers, easy access to Internet and World Wide Web (WWW),
Internet is increasingly used by banks as a channel for receiving
instructions and delivering their products and services to their
customers. This form of banking is generally referred to as
Internet Banking, although the range of products and services
ofered by diferent banks vary widely both in their content and
sophistication.

17

Meaning of E-Banking
E-bank is the electronic bank that provides the financial service
for the individual client by means of Internet.

18

Chapter 2

Observation of study
DEFINITION OF E-BANKING

For this booklet, e-banking is defined as the automated delivery of

new and traditional banking products and services directly to
customers
through
electronic,
interactive communication
channels. E-banking includes the systems that enable financial
institution customers, individuals or businesses, to access
accounts, transact business, or obtain information on financial
products and services through a public or private network,
including the Internet. Customers access e-banking services using
an intelligent electronic device, such as a personal computer (PC),
personal digital assistant (PDA), automated teller machine (ATM),
kiosk, or Touch Tone telephone. While the risks and controls are
similar for the various e-banking access channels, this booklet
focuses specifically on Internet-based services due to the
Internets widely accessible public network. Accordingly, this
booklet begins with a discussion of the two primary types of
Internet websites: informational and transactional.

E-BANKING SUPPORT SERVICES

WEBLINKING
A large number of financial institutions maintains sites on the
World Wide Web. Some websites are strictly informational, while
others also ofer customers the ability to perform financial
transactions, such as paying bills or transferring funds between
accounts.
WIRELESS E-BANKING
Wireless banking is a delivery channel that can extend the reach
19

and enhance the convenience of Internet banking products and

services. Wireless banking occurs when customers access a
financial institution's network(s) using cellular phones, pagers,
and personal digital assistants (or similar devices) through
telecommunication companies wireless networks. Wireless
banking services in the United States typically supplement a
financial institution's e-banking products and services.
Person-to-Person Payments
Electronic person-to-person payments, also known as e-mail
money, permit consumers to send money to any person or
business with an e-mail address. Under this scenario, a consumer
electronically instructs the person-to-person payment service to
transfer funds to another individual. The payment service then
sends an e-mail notifying the individual that the funds are
available and informs him or her of the methods available to
access the funds including requesting a check, transferring the
funds to an account at an insured financial institution, or
retransmitting the funds to someone else. Person-to-person
payments are typically funded by credit card charges transfer
from the consumers account at a financial institution. Since
neither the payee nor the payer in the transaction has to have an
account with the payment service, such services may be ofered
by an insured financial institution, but are frequently ofered by
other businesses as well.
Banking Services through Internet:
1.

The Basic Level Service is the banks web sites which

disseminate information on diferent products and services
ofered to customers and members of public in general. It
may receive and reply to customers queries through e-mail;
2. In the next level are Simple Transactional Web sites which
allows customers to submit their instructions, applications for
20

diferent services, queries in their account balances, etc. but

do not permit any fund-based transactions on their accounts;

3. The third level of Internet banking service are ofered by

Fully Transactional Web sites which allow the customers to
operate on their accounts for transfer of funds, payment of
diferent bills, subscribing to other products of the bank and
to transact purchase and sale of securities, etc. The above
forms of Internet banking service the customer or by new
banks, who deliver banking service primarily through Internet
or other electronic delivery channels as the value added
services. Some of these banks are known as Virtual banks or
Internet only banks and may not have physical presence in a
country despite ofering diferent banking services.
The Indian Scenario: Internet banking, both as a medium of delivery of banking
services and as a strategic tool for business development.

At present, the total internet users in the country are

estimated at 9 lakh. However, this is expected to grow
exponentially to 90 lakh by 2003. Only about 1 percent of
Internet users did banking online in 1998. This is increased to
16.7 percent in March 2000.
- (India Research, May 29, 2000, Kotak Securities)
Cost of banking service through the Internet from a fraction
of costs through conventional methods. Rough estimates
assume teller cost at Re.1 per transaction, ATM transaction
cost at 45 paise, phone banking at 35 paise, debit cards at 20
21

paise and Internet banking at 10 paise per transaction.

Plastic Cards as Media for Payment: -

There are four types of plastic cards being used as media

for making payments. These are:
1.
2.
3.
4.

Credit Card
Debit Card
Smart Card
ATM Card

1. Credit Cards: The credit card enables the cardholders to: Purchase any item
like clothes, jewellery, railway/air tickets, etc.
Pay bills for dining in a restaurant or boarding and lodging in
hotel
Avail of any service like car rental, etc.
2. Debit Cards: A debit card is issued on payment of a specified amount by the
issuing company like a telephone company to a customer on cash
payment or on debiting his account by a bank.
Thus it is like an electronic purse, which can be read and debited
by the required amount.
It may be noted that while through a credit card, the customer
first makes a purchase or avails service and pays later on, but for
22

getting the debit card, a customer has to first pay the due amount
and then make a purchase or avail the service. For this reason,
debit card are not as popular as credit cards.

3. Smart Cards: Smart Cards have a built-in microcomputer chip, which can be
used for storing and processing information. For example, a
person can have a smart card from a bank with the specified
amount stored electronically on it. As he goes on making
transactions with the help of the card, the balance keeps on
reducing electronically. When the specified amount is utilized by
the customer, he can approach the bank to get his card validated
for a further specified amount. Such cards are used for paying
small amounts like telephone calls, petrol bills, etc.

4. ATM Cards: The card contains a PIN (Personal Identification Number) which is
selected by the customer or conveyed to the customer and
enables him to withdraw cash up to the transaction limit for the
day. He can also deposit cash or cheque.

23

Chapter 3

Literature Review
A new review by Tower group of 10 top US e- banking web sites
evaluated several aspects of core online banking components.
Group found that there is diference in terms of actual
functionality and usability. Among diferent banks and their
services.
The UK's first home online banking services were set up by the
Nottingham Building Society (NBS) in 1983 ("History of the
Nottingham". Retrieved on 2007-12-14.). The system used was
based on the UK's Prestel system and used a computer, such as
the BBC Micro, or keyboard (Tan data Td1400) connected to the
telephone system and television set. The system (known as
'Home link') allowed on-line viewing of statements, bank transfers
and bill payments. In order to make bank transfers and bill
payments, a written instruction giving details of the intended
recipient had to be sent to the NBS who set the details up on the
Home link system.
An American study conducted last year by Booz-Allen projects
that by the year 2000, 16 million US households will be using
Internet banking. While these numbers do not appear to be
significant as compared to the total population, each Internet user
is projected to be 50-250% more profitable than the average
banking customer. It is expected that these Internet customers
24

will be some of the banking system's most profitable customers

representing close to 30% of all retail banking profits. The study
projects that by 1999, 1,500 banks will have Internet Web sites
and at least 500 of these banks will be ofering full-fledged
Internet banking services.
In 2001 Micro banker send detailed questionnaire to the leading
vendors of internet banking software27 companies responded
with information on thirty programs the aggregate outcome of the
outcome was that almost all the companies have developed
functions for internet banking and have inbuilt feature to aid with
one to one marketing on the web.

ICICI Bank
ICICI Bank Online Banking Services provide the largest private
bank in India right here at your desktops. Banking becomes a
pleasure as the transactions and services become instant with
ICICI Bank online Internet banking. The services provided are
totally secure and unique. These cover online account
transactions and operations, credit card and account
applications and payments, share trading and investments
through mutual funds, bill payments, statement generation and
a virtual demo of each service. See in brief in final report.

Role of customer when using e-banking

You can access ICICIBank.com only by using your User ID
and Password. During the first login attempt, it is mandatory
to change both passwords - login and transaction which
would have been mailed to you by the bank.
25

If you forget your password, you will have written to us using

the "Email Us" option. The Bank will then issue a new
password and send it to your mailing address as per our
records. Kindly check with your branch that this address is
updated...
Make sure no one can see the account login name or
password you are entering when you log on to
ICICIBank.com.
Logout of ICICIBank.com before moving on to other
Websites.
Before leaving the PC please "close" the browser.
Do not write your ICICIBank.com login name or password
anywhere.
Do not leave your login name and password such that
someone sitting at your computer could see them.
Never reveal your ICICIBank.com login name and password
to anyone (no representative of ICICI Bank will ever ask you
for your ICICIBank.com password).
Notify ICICI Bank immediately if you notice any unusual
account activity.
Keep all documents that include your account information in
a secure location.
When you login you can view the date and time of your last
log in.

26

Features ofered by ICICI bank for internet banking

Balance enquiry and statement
Transfer fund online
Card to card fund transfer
Use debit card online
Prepaid mobile recharge
Subscribe for mobile banking
Link bank account to ATM
Lock / activate debit cards /ATM
Request a cheque book
Stop payment

HDFC
Net Banking is HDFC Bank's Internet Banking service. Providing
up-to-the-second account information, Net Banking lets you
manage your account from the comfort of your mouse anytime, anywhere.
Features ofered by HDFC bank for internet banking
View account balances and statements
Transfer funds between accounts
Request stop payments
Pay bills
Create fixed deposit online
27

Order cheque books

USE OF E-BANKING IN INDIA FEOM LAST FEW YEARS

Year
Incr.
%

2002
9

2003
12

2004
15

2005
20

2006
25

2007
32

2008
40

2009
50

Finding
In 2002-2009 the user of the E-banking is increase in more in every
year.

Chapter 4

Objective of study
Find the customer satisfaction relating to E-banking service.
To study the awareness of internet banking among the
customers of ICICI and HDFC banks.

Chapter 4.1

Limitation of Study
Banks are not giving me all information about E-banking
services.
They do not permit to meet any of the employees in their
bank.

Chapter 5
30

Data collection
Primary Data:
In this research with a sample size of nearly 20 customers data
will be available in form of questionnaire collected in terms of
diferent questions influencing the use of internet banking.
Internet banking is considered as dependent on awareness
among customers which will be studied with help of diferent
independent variable. Only the customers of HDFC & ICICI bank
are taken as samples for study.
Secondary data:
Collection of information from diferent kind of books the data of
the company what they maintained.

Methodology
Once the findings are finalized by a research, suggestions should
be made for the betterment of enterprise.
The data collected from questionnaire will be tabulated and
analyzed so that
The result can be presented as simple as possible. There are a
number of ways like
o Pie-chart
o Graphs

Questionnaire:31

1. Name of the customer:-

2.

Do you like E-banking

a. Yes
b. No

3. Tick which bank you preferred

a. Icici
b. Sbi
c. Sbh
d. Axis
e. Union bank
f. Hdfc
g. UTI Bank Ltd
h. Bank of Punjab Ltd

4. Why this bank

a.

Service is good
32

b. They provide security

c.

5.

Cheaper service fees.

Which type of service mostly you use?

a.

Balance and transaction history search

b. Transfer fund online

c. Card to card fund transfer
d. Open FD
e. Lock / activate debit cards /ATM
f. Request a cheque book
g. Stop payment
h.

Railway pass / ticket

i. Shopping
j. Share payment
6. Services of the bank are.
a. poor
b. good
c. Very good

7.

Are you satisfied with the using of E-banking?

a. Yes
33

b. No

34

Final Report

35

Chapter 6

Data analysis
1) Users of E-banking

Yes

65%

No

35%

2) No. of user of the banks

Icici

20%

Sbi

30%

Sbh

20%
36

3)

Axis

10%

Union

8%

Hdfc

12%

PREFERENCE FOR ONLINE BILL PAYMENT SERVICES

Yes

60%

No

40%

37

4)

PREFERENCE FOR ONLINE SHOPPING

Yes

70%

No

30%

38

5)

PREFERENCE FOR ONLINE FUND TRANSFAR

Yes

35%

No

65%

39

6) SATISFIED CUSTOMERS

Yes

65%

No

35%

40

7) PERFERRED MODE OF PAYMENT (TO BANK)

CHEQUE

50

CASH

25

E-BANKING

25

8) SPEND PER BILL FOR ON LINE BILL PAYMENT

41

ABOVE Rs.10

21

BETWEEN RS.5-10

11

BELOW RS.5

32

NOTHING

36

42

Chapter 7

Findings
1. In the users ratio of internet banking 65% of customers are
using this service.
2. More banks are connecting to the any software co. to
running the E-banking service. In these services the Sbi
banks is top in service of E-banking.
3.

The services that are mostly used by maximum customers

are transactions, online trading, bill payment, shopping etc.

4. The mode of the cash deposit in bank is for use to online

truncation cash, cheque & e-banking.
5.

Diferent banks diferent charge for online service.

Suggestions
1.

To prevent online banking from remaining customers to

prompt this service through advertising co.

2. After repairing this basic deficiency, banks must ensure that

there services is competitive.
3.

Banks is not take more charge from there customers.

43

Chapter 8

Conclusion
The basic objective of my research was to analyze
the

awareness

among

customers

for

internet

banking in INDIA. It gives direction to research

tools, research types and techniques. Although the
findings

reveal

that

people

know

about

the

services but still many people are unaware and

many of them are non users so the bank should
by promotion try to retain the customers. Banks
should look forward to have some tie ups with
other financial institutions to increase the service
base.

44