Research Journal of Management Sciences _____________________________________________ISSN 2319–1171 Vol. 4(5), 6-14, May (2015) Res. J. Management Sci. International Science Congress Association 6 Internet Banking Adoption: An Observation on public sector bank customers of urban area of Udupi district, Karnataka, India Pandey Priyanka, Mayya Sureshramana and Joshi H.G.Department of Commerce, Manipal University, Manipal -576104, Karnataka, INDIA Department of Commerce, M.G.M. College, Udupi-576102, Karnataka, INDIAAvailable online at: www.isca.in, www.isca.me Received 30th March 2015, revised 16th April 2015, accepted 4th May 2015 Abstract Now-a-days banks are adopting new technology and acknowledged as innovative banking. Internet banking is one of among several innovative banking and significantly influence banking and financial undertakings. Banking become easier after arrival of various electronic gadgets and internet facilities. There are many benefits, products and services of internet banking. It is surprising that number of bank customers like to do banking through traditional way. Banks are experimenting various ways to acquire probable number of customer. Still it not works as per expectation and they are not able to retain customers. Adoption of any technology is very much influenced by the perception about that technology among its users and has vital role in the success of that. To find bank customers perception and criteria to discriminate difference between both traditional and internet banking is important. This paper explore perception of customers about adoption of internet banking in urban area of Udupi district. Data collection was done through questionnaire. Content of the survey was associated to demographic query of participants and questions related to perception of internet banking. Observation of this study reflects that maximum number of the respondents were worried about security and feel that it is not reliable. Though they perceive that internet banking is suitable, less time consuming, easy and useful. The learning from study is worthwhile to explore perceived facts related to adoption of internet banking. It might support banks in the direction of develop effective and informative internet baking strategies to gain faith of customers and to create interest among customers for adoption of internet banking. Keywords: Adoption, perception, technology, internet banking, customers. Introduction Information technology and globalization influence banking sector tremendously. Banking activities become more easy and convenient. Information technology marks a transformation in banking operations and services. Recent arrival and one of good example is internet banking services. Move from traditional to electronic banking services like internet banking indicate vital revolution in banking field. Outlook of customers to adopt such innovative technological services is significant driver for success. Various factors are responsible for making customer’s mind ready to accept internet banking. Customers have their own mind set and facts perceived by them about services of internet banking acceptance. Demographic profile, awareness and knowledge, accessibility of adequate resources, user friendliness, willingness, convenience, priority of privacy and security etc. are few factors that influence customers. Through internet banking banks are providing various services e.g. history of account, account statement, online shopping, payment of bill, tax and last not the least different types of bookings etc. Paperless banking is possible just because of technological service like internet banking with the ease and convenience. It is also available round to clock and across the world. Move from branches to online banking is not getting expected number of customers. It is revealed by some studies that users of internet are increasing day by day still users of internet banking are not increasing. People prefer to visit banks to do their banking activities simultaneously to some extent they or their younger generation use few service of internet banking. The fact comes in scenario that people like to use mixed delivery channel and don’t want to dependent upon any specific delivery channel. Researchers pointed out that internet banking adoption percentage are varying country wise. Banks are dealing with many challenges still they offer various internet banking services and upgrading the services and products as per need and global competition. Gaining customers and to retain customers for internet banking are important problem that banks face. Privacy and security are another vital challenge for banks to gain faith of customers as mentioned in some studies. Few researchers said that phishing attacks progressing 50%, with about 5% users become victimized. Customers mind always having suspicion, fear and threat for phishing attack and frauds. They don’t want to compromise. Assurance of internet banking service quality, security and privacy occupy as a question mark in the mind of customers. Researchers from various countries argued that there are some similar and some dissimilar factors that influence customers perception positively or negatively to use and not to use internet banking.Literature review: Internet banking is a vital discovery for banking sector and their operational channel from recent past. It is Research Journal of Management Sciences _______________________ Vol. 4(5), 6-14, May (2015) International Science Congress Association an empowerment of any individual to do financial and banking activities efficiently as per their convenience dev elopment of series of new technology and safe operational application, increasing number of banks across the world are mounting competencies of their services and products. Banks proposing automated, self- serviced, time saving, cost saving, convenient info rmational and operational channels in the form of internet banking to the customers. Finding out various factors involved in adoption of internet banking attracts researchers to study. A number of studies indicates that behavioral character and attitude in fluences customer’s decision to choose or not to choose internet banking2,3. Few studies discussed that to adopt internet banking demographics of customer also influence significantly Some studies mentioned that different variables influence customers distinctly to adopt internet banking internet banking adoption on older people. Computer knowledge and complicated process is one of vital factor for old people and hinders to adopt internet banking. In spite of many studies on internet ba nking there is no sufficient information that convince particular factors are responsible behinds adoption or rejection of internet banking whereas few common variables are discussed by many researchers that influence customers’ tendency to adopt or not. Read et. al. cited in his work that customers’ emotional connection with paper and faith on that is one of the restrictive factor to adopt new innovative medium of banking individuals on internet banking technology and related advantages and dis advantages of facilitated services and products works as catalyst to accept internet banking. Disadvantage and advantage in the mind of customers may be effected and related by benefit, comfort, social status, economic condition, safety, privacy, cost and time saving concerns, efficacy with computer and technology, need to adopt and many more internet banking is complex procedure. Joined observation of customers’ personal, social, psychological, behavioral and many more features are importa nt. Introducing new technology and its effective execution is determined by recognition of individual customers’ perception and social economic background. To be Internet banking (users _______________________ __________ ________________________ Association to do financial and banking activities efficiently as per their convenience . By the elopment of series of new technology and safe operational application, increasing number of banks across the world are mounting competencies of their services and products. Banks serviced, time saving, cost saving, rmational and operational channels in the form of Finding out various factors involved in adoption of internet banking attracts researchers to study. A number of studies indicates that behavioral character and fluences customer’s decision to choose or not to choose Few studies discussed that to adopt internet banking demographics of customer also influence significantly 3-5. Some studies mentioned that different variables influence distinctly to adopt internet banking , which inspects Computer knowledge and complicated process is one of vital factor for old people and In spite of many studies on nking there is no sufficient information that convince particular factors are responsible behinds adoption or rejection of internet banking whereas few common variables are discussed by many researchers that influence customers’ tendency to adopt or Read et. al. cited in his work that customers’ emotional connection with paper and faith on that is one of the restrictive factor to adopt new innovative medium of banking . Faith of individuals on internet banking technology and related advantages advantages of facilitated services and products works as catalyst to accept internet banking. Disadvantage and advantage in the mind of customers may be effected and related by benefit, comfort, social status, economic condition, safety, privacy, cost time saving concerns, efficacy with computer and technology, need to adopt and many more 9-11. Adoption of internet banking is complex procedure. Joined observation of customers’ personal, social, psychological, behavioral and many nt. Introducing new technology and its effective execution is determined by recognition of individual customers’ perception and social economic background. To be successfully accepted and used service banks should communicate clear and proper information a products, services and benefits. As for example its compatibility with life style of customer, convenience, cost and time effectiveness, different related perceived problems and their easy solutions etc. The idea of outlook and motiva technology adoption is useful to gain customers benefits are observed as vital factor but is not sufficient condition in the way to cognize adoption behavior of customers banking adoption process is based on ident exploring, examining and judging various positive and negative aspects, profits, usefulness, threats, opportunities etc. and plays major role in adoption. Objective: To study internet banking adoption awareness among public sector ban k customers of urban area of Udupi district, Karnataka.Methodology This study is cross sectional investigation of public sector bank customers of urban area of Udupi district, Karnataka. Sampling method was convenience. Sample size English was used as a tool for investigation. A five point Likert scale was used to mea sure their perceptions such as disagree, 2= disagree, 3= neither agree nor disagree, strongly agree. Demographic prof perception of internet banking was included in questionnaire. Statistical analysis was done through SPSS 16.0 package. Results and Discussion For survey 300 respondents were approached among them 265 useful returned questionn aire were used for study. 265 returned questionnaire reflects 52.45% customers do not use internet banking whereas 47.55% were using ( Figure-1 Internet banking (users and non-users) ________________________ ISSN 2319–1171 Res. J. Management Sci. 7 successfully accepted and used service banks should communicate clear and proper information a bout internet banking products, services and benefits. As for example its compatibility with life style of customer, convenience, cost and time effectiveness, different related perceived problems and their easy The idea of outlook and motiva tion related to technology adoption is useful to gain customers 12,13. Moreover benefits are observed as vital factor but is not sufficient condition in the way to cognize adoption behavior of customers 14. Internet banking adoption process is based on ident ification, learning, exploring, examining and judging various positive and negative aspects, profits, usefulness, threats, opportunities etc. and plays To study internet banking adoption awareness among k customers of urban area of Udupi district, This study is cross sectional investigation of public sector bank customers of urban area of Udupi district, Karnataka. Sampling Sample size was 265. Questionnaire in English was used as a tool for investigation. A five point Likert sure their perceptions such as 1= strongly disagree, 2= disagree, 3= neither agree nor disagree, 4= agree, 5= strongly agree. Demographic prof ile and questions related to perception of internet banking was included in questionnaire. Statistical analysis was done through SPSS 16.0 package. For survey 300 respondents were approached among them 265 aire were used for study. 265 returned questionnaire reflects 52.45% customers do not use internet banking whereas 47.55% were using ( figure-1). Research Journal of Management Sciences _______________________ Vol. 4(5), 6-14, May (2015) International Science Congress Association Profile of respondents (Demographic): Figure-2 Gender Figure-4 Marital status _______________________ __________ ________________________ Association Figure-3 Age Figure-5 Educational qualification ________________________ ISSN 2319–1171 Res. J. Management Sci. 8 Educational qualification Research Journal of Management Sciences _______________________ Vol. 4(5), 6-14, May (2015) International Science Congress Association Figure-6 Profession Figure-8 It is easy to learn and use IB  _______________________ __________ ________________________ Association Figure-7 Monthly income Figure-9 easy to learn and use IB Facilities provided through IB are familiar ________________________ ISSN 2319–1171 Res. J. Management Sci. 9 Monthly income Facilities provided through IB are familiar Research Journal of Management Sciences _______________________ Vol. 4(5), 6-14, May (2015) International Science Congress Association Figure-10 IB is compatible with my banking need Figure-12 IB navigation is simple  \n  \r\r  \n \r\r _______________________ __________ ________________________ Association Figure-11 IB is compatible with my banking need IB site is safe and trustworthy Figure-13 IB keeps its promises and commitments     ________________________ ISSN 2319–1171 Res. J. Management Sci. 10 IB site is safe and trustworthy IB keeps its promises and commitments Research Journal of Management Sciences _______________________ Vol. 4(5), 6-14, May (2015) International Science Congress Association Figure-14 IB creates sense of individualization Figure-16 IB leaves impression of proficient   \r\r _______________________ __________ ________________________ Association Figure-15 IB creates sense of individualization Using IB eased my tranactions Figure-17 IB leaves impression of proficient Product and services offere d by IB are satisfactory   ________________________ ISSN 2319–1171 Res. J. Management Sci. 11 Using IB eased my tranactions d by IB are satisfactory Research Journal of Management Sciences _______________________ Vol. 4(5), 6-14, May (2015) International Science Congress Association Figure-18 I feel to carry on IB services Figure- 1 shows that 52.45% respondents are not using internet banking whereas 47.55% are using. Figure- 2 displays out of 265 participants from survey 35.10% were female and 64.90 % were male. Figure- 3 represents age group from which respondents belong. Most of the respondents were from age 20 and rest were from 32- 40 (19.3%), �50 (18.7%), and 20 (11.3%). Figure- 4 shows that most of the respondents were married (59.7%). Figure- 5 represents educational qualification of respondents that reflects that graduated respondents were in majority (40.3%) and another category who have po st graduate educational qualification were 36.3%, others type of qualified were (6%) and 5.7% were high school passed. Figure- 6 focuses on profession of respondents that depicts 32% belongs from in government job, private job holder were 26%, 21.7% were fr om students category, 5% were doing other kind of job whereas 3.7% were self-employed. Figure- 7 shows monthly income of respondents. Monthly income of most of respondents come from �50, 000 (25.3%) and others from 40,001- 50,000 (17.3%), 30,001 20,001-30,000 (8.3%), 10,000- 20,000 (6.0%), 10,000 (6.0%) and (15.7%) were come from no income group. Twelve statements were asked by respondent through questionnaire associated to internet banking perception. Answer of users are as follows: To lear n and use internet banking is easy, 51.6% user respondents were agree with the statement and others were responded as 38.1% strongly agree, 4.8% disagree, 4.8% neither agree nor disagree and .8% strongly disagree ( answer express that most of the users of internet banking  \n  \r \r  _______________________ __________ ________________________ Association Figure-19 I feel to carry on IB services My friends and family members are using IB 1 shows that 52.45% respondents are not using internet 2 displays out of 265 participants from survey 35.10% were female and 64.90 % were 3 represents age group from which respondents belong. Most of the respondents were from age 20 -30 (23.7%) 40 (19.3%), �50 (18.7%), 41-50 (15.3%) 4 shows that most of the respondents 5 represents educational qualification of respondents that reflects that graduated respondents were in majority (40.3%) and another category who st graduate educational qualification were 36.3%, others type of qualified were (6%) and 5.7% were high school passed. 6 focuses on profession of respondents that depicts 32% belongs from in government job, private job holder were 26%, om students category, 5% were doing other kind 7 shows monthly income of respondents. Monthly income of most of respondents come from �50, 000 (25.3%) 50,000 (17.3%), 30,001 -40,000 (9.7%), 20,000 (6.0%), 10,000 (6.0%) and (15.7%) were come from no income group. Twelve statements were asked by respondent through questionnaire associated to internet banking perception. Answer n and use internet banking is easy, 51.6% user respondents were agree with the statement and others were responded as 38.1% strongly agree, 4.8% disagree, 4.8% neither agree nor disagree and .8% strongly disagree ( figure-8). The the users of internet banking perceive that there is an easy process to learn and use internet banking. Venkatesh, Alsajjan and Dennis recommends that there is straight and significant consequence of perceived ease of use on intention of customers to adop stage of learning15, 16. Provided facilities of internet banking are familiar, 60.3% user respondents agree whereas others responded as 22.2% strongly agree, 13.5% neither agree nor disagree. Response for strongly agree was nil (figure- 9). Familiarity and experience has a constructive effect on adoption of internet banking and one’s own belief on ability to use 17, 18. Most of the respondents (67.5%) were agree about compatibility of banks regarding their banking needs. Rest res strongly agree, 9.5% neither agree nor disagree, .8% disagree, no one respond for strongly disagree ( Safety and trustworthy were two important concerns of most of the user respondents. 42.9% disagree that it is safe and trustwor thy. Others respond as neither agree nor disagree 32.0%, agree 13.5%, strongly disagree 12.7 % and no one respond for strongly agree (figure- 11). that bank should clearly provide internet banking security information on banks websites19, 20 . Reis argued how to improve an education system for practicing secure internet banking Increasing number of incidence related to online frauds and identity mugging become more sophisticated e.g. sniffing, phishing, trojans, spyware, malware, etc. and big challenge for banks22.   ________________________ ISSN 2319–1171 Res. J. Management Sci. 12 My friends and family members are using IB perceive that there is an easy process to learn and use internet banking. Venkatesh, Alsajjan and Dennis recommends that there is straight and significant consequence of perceived ease of use on intention of customers to adop t technology in the early Provided facilities of internet banking are familiar, 60.3% user respondents agree whereas others responded as 22.2% strongly agree, 13.5% neither agree nor disagree. Response for strongly 9). Familiarity and experience has a constructive effect on adoption of internet banking and one’s Most of the respondents (67.5%) were agree about compatibility of banks regarding their banking needs. Rest res pond as 22.2 % strongly agree, 9.5% neither agree nor disagree, .8% disagree, no one respond for strongly disagree ( figure-10). Safety and trustworthy were two important concerns of most of the user respondents. 42.9% disagree that it is safe and thy. Others respond as neither agree nor disagree 32.0%, agree 13.5%, strongly disagree 12.7 % and no one 11). Subsorn, Lee et al. stated that bank should clearly provide internet banking security . Reis argued how to improve an education system for practicing secure internet banking 21. Increasing number of incidence related to online frauds and identity mugging become more sophisticated e.g. password spyware, malware, etc. and big Research Journal of Management Sciences _________________________________________________________ISSN 2319–1171Vol. 4(5), 6-14, May (2015) Res. J. Management Sci.International Science Congress Association 13 57.9% respondents were agree that internet banking navigation is simple followed by 19.0% strongly agree, 13.5% neither agree nor disagree, 7.9% disagree and 1.6%strongly disagree (figure-12). A user-friendly banks website with the feature of adequate required information, easy access, simple navigation, quick response is needed to acquire more adoption of internet banking23, 24 and 25. Internet banking hold on its commitments and promises, 46.0% users agree and rest were answered as 31.0% neither agree nor disagree, 17.5% strongly agree, 5.6% disagree (figure-13). Use of internet banking generate feeling of individualization, 53.2% users agree and rest react as 23% neither agree nor disagree, 18.3% strongly agree, 4.0% disagree and 1.6% strongly disagree (figure-14). Transactional activities become easy because of use of internet banking, 71.4% users were agree with the statement and rest were as follows 19.0% strongly agree, 7.9% neither agree nor disagree, .8% disagree and .8% strongly disagree (figure-15). Convenience, speed and 24x7 possibilities of access eased the banking transactions 26, 27. User felt proficient by use of internet banking, 57.1% users agree and rest respond as 28.6% neither agree nor disagree, 8.7% strongly agree, 5.6% disagree (figure-16). Internet banking offered product and services are satisfactory, 69.8% users agree with that whereas others were as 17.7% neither agree nor disagree, 8.7% strongly agree, 4.8% disagree (figure-17). Customers were happy by using internet banking products and services28.User wish to continue with present bank as they were satisfied, 66.7% user agree with that whereas rest answered as 25.4% strongly agree, 6.3 neither agree nor disagree, 1.6 disagree and no one respond for strongly disagree (figure-18). Customers’ satisfaction is one of factor that influence decision to continue with present bank28. Family members and friends are using internet banking, 63.5% users agree with the statement others respond as 20.6% neither agree nor disagree, 10.3% strongly agree, 5.6 disagree (Figure-19). Social and personal surroundings and characteristics influence individuals to accept internet banking29. ConclusionThe result of the study disclose that non-users of internet banking are in majority. Finding indicates that user perceived that in spite of many benefits of internet banking there is threat of compromising privacy and safety and it’s not as much trustworthy. Whereas some of them answered neither agree nor disagree that shows they must have suspicion and confusion regarding safety and privacy of internet banking use. Moreover they respond positively about convenience of using services of internet banking. Most of the users’ answer reflects that they were happy with banks facilities and they were familiarity with that. The study reflects that banks would give more attention towards safety and security concerns and its proper communication among customers to gain trust of customers. Banks should introduce website with transparent and clear information about security and privacy. Further studies are needed to investigate more issues observed in this study. 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