Customer Perspectives on E-business Value


PROGRAMME Bachelor of Commerce in Entrepreneurship
MODULE Entrepreneurship 3A
YEAR Three (3)
INTAKE July 2020
DATE 02 December 2020

Read the case study below and answer ALL questions that follow [100 MARKS]
Customer Perspectives on E-business Value: Case Study on Internet Banking
Information technology is considered as the key driver for the changes taking place around the world. Internet banking
(IB) is the latest and most innovative service offered by the banks. The transformation from the traditional banking to ebanking has been a ‘leap’ change. The evolution of e-banking started from the use of Automatic Teller Machines (ATMs)
and telephone banking (tele-banking), direct bill payment, electronic fund transfer and the revolutionary online banking.
The proliferation of, and rapid advances in, technology-based systems, especially those related to the internet, are leading
to fundamental changes in how companies interact with customers (Ibrahim et al, 2006; Bauer et al., 2005; Parasuraman
and Zinkhan, 2002). Internet banking has become the self-service delivery channel that allows banks to provide
information and offer services to their customers with more convenience via the web services technology. The new world
of electronic banking is changing day by day. It is important to understand the customer’s perception on internet banking.
Today, many financial services organizations are rushing to become more customer focused. A key component of many
initiatives is the implementation of Customer Relationship Management (CRM) software (Peppard, 2000). Many
companies in the financial services sector have been quick to implement Internet capabilities, and electronic service is
becoming a viable option for interaction between financial service providers and their customers (Rotchanakitumnuai, S
and Speece, M 2004).
The challenging business process in the financial services pressurized banks to introduce alternate delivery channel to
attract customers and improve customers’ perception. Many banks have implemented Internet banking to offer their
customers a variety of online services with more convenience for accessing information and making transactions.
Customer satisfaction and customer retention are increasingly developing into key success factors in e-banking (Bauer et
al, 2005). Technology, in particular, has been increasingly employed in service organizations to enhance customer service
quality and delivery, reduce costs, and standardize core service offerings (Ibrahim et al, 2006; Kelley, 1989; Quinn, 1996;
Dannenberg and Kellner, 1998; Lee and Lin, 2005; Bauer et al, 2005; Gounaris et al, 2005). There will be huge acceptance
of online banking with the passage of time with growing awareness and education. A great many people are shifting to
online banking and are readily accepting the usefulness of this bounty. Online banking service allows customers to
manage their accounts from any place at any time for minimum cost; it gives abundant compensation to the client in terms
of price and ease.
Internet banking
Internet banking is the latest in the series of technological wonders of the recent past. ATMs, Tele-Banking, Internet
Banking, Credit Cards and Debit Cards have emerged as effective delivery channels for traditional banking products.
Internet or Electronic or online banking is the newest delivery channel to be offered by retail banks in many developed
countries, and there is a wide agreement that this channel will have a significant impact on the market. Banks know that
the Internet opens up new horizons for them and moves them from local to global frontiers (Mavri and Ioannou, 2006).
Internet banking refers to systems that enable bank customers to get access to their accounts and general information on
bank products and services through the use of bank’s website, without the intervention or inconvenience of sending letters,
faxes, original signatures and telephone confirmations (Thulani et al, 2009; Henry, 2000). In its simplest form, electronic
banking may mean the provision of information about the bank and its products via a page on the internet (Ibrahim et al,
Information technology developments in the banking sector have sped up communication and transactions for clients.
Online banking is also one of the technologies which are fastest growing banking practices nowadays. It is vital to extend
this new banking feature to clients for maximizing the advantages for both clients and service providers (Qureshi et al,
2008). The Internet has an ever-growing importance in the banking sector because of the advantages it brings to both the
entities and their customers.
Although information system (IS) expenditure is regarded costly and risky financial institutions are one of the largest
investors in IS (Mashhour and Zaatreh, 2008; Robson, 1997). Internet is the cheapest delivery channel for banking
products as it allows the entity to reduce their branch networks and downsize the number of service staff. The navigability
of the website is a very important part of Internet banking because it can become one of the biggest competitive
advantages of a financial entity (Ortega et al, 2007). Bankers consider ‘minimizes inconvenience’, ‘minimizes cost of
transactions’ and ‘time saving’ to be important benefits and ‘chances of government access’, ‘chances of fraud’ and ‘lack
of information security’ to be vital risks associated with electronic banking (Kaleem and Ahmad, 2008). Due to increase in
technology usage the banking sector’s performance increases day by day. Online banking is becoming the indispensable
part of modern day banking services. Banking industry is also one of the influenced industries adopting technologies which
are helpful in providing better services to customers. Quality of service is improved by using technological innovations.
Online banking is time saving (Qureshi et al, 2008).
QUESTION 1 (20 Marks)
In light of the case study, discuss with examples the advantages that E-Commerce brings to firms like commercial Banks.
QUESTION 2 (20 Marks)
The extract refers to risks associated with electronic banking. Describe with examples, the common risks in running an ecommerce business that commercial Banks may experience.
QUESTION 3 (20 Marks)
The use of Internet provides a very fast and cost effective means of communication and information sharing. Based on
the case study, discuss with examples, the value of internet connectivity to entrepreneurs.
QUESTION 4 (20 Marks)
Entrepreneurs that are involved in Pure or Partial e-commerce on their websites need to follow certain best practices for
their websites to be effective. With reference to the case study, describe the characteristics of the best e-commerce sites
that will ensure that businesses like commercial banks offer their customers the best solutions available.
QUESTION 5 (20 Marks)
Discuss some of the fundamental ethical issues in business that commercial banks and entrepreneurs at large must comply
with and put into action.

Posted in Uncategorized

Leave a Reply