Brm Report2

ABSTRACT Internet banking has become the latest delivery channel for banking services due to the backlash from globalization and liberalization of financial services. This study revealed that the banks have achieved considerable success as far as awareness is concerned as a vast majority of the respondents reported that they were aware of Internet banking. Although awareness is moderate, unavailability is high, this has not translated into actual use as only 24.4% have had some Internet banking experience. Using the discriminates analysis it was found that Internet banking users had more prior Internet experience, had positive views on ease of use, were more aware of the Internet banking services and benefits and also had less security concerns as compared to the non-users of Internet banking.

INTRODUCTION History of Computer: A computer is a machine that manipulates data according to a list of instructions. The first devices that resemble modern computers date to the mid-20th century (around 1940 - 1945), although the computer concept and various machines similar to computers existed earlier. Early electronic computers were the size of a large room, consuming as much power as several hundred modern personal computers. Modern computers are based on tiny integrated circuits and are millions to billions of times more capable while occupying a fraction of the space. Today, simple computers may be made small enough to fit into a wristwatch and be powered from a watch battery. Personal computers in various forms are icons of the Information Age and are what most people think of as "a computer"; however, the most common form of computer in use today is the embedded computer. Embedded computers are small, simple devices that are used to control other devices — for example; they may be found in machines ranging from fighter aircraft to industrial robots, digital cameras, and children's toys.

Introduction to Internet: The Internet is a worldwide, publicly accessible series of interconnected computer networks that transmit data by packet switching using the standard Internet Protocol (IP). It is a "network of networks" that consists of millions of smaller domestic, academic, business, and government networks, which together carry various information and services, such as electronic mail, online chat, file transfer, and the interlinked web pages and other resources of the World Wide Web (WWW).

Internet access: Common methods of home access include dial-up, landline broadband (over coaxial cable, fiber optic or copper wires), and satellite and 3G technology cell phones.

Public places to use the Internet include libraries and Internet cafes, where computers with Internet connections are available. There are also Internet access points in many public places such as airport halls and coffee shops, in some cases just for brief use while standing. Various terms are used, such as "public Internet kiosk", "public access terminal", and "Web payphone". Many hotels now also have public terminals, though these are usually fee-based. These terminals are widely accessed for various usages like ticket booking, bank deposit, online payment etc. Wi-Fi provides wireless access to computer networks, and therefore can do so to the Internet itself. Hotspots providing such access include Wi-Fi cafes, where would-be users need to bring their own wirelessenabled devices such as a laptop or PDA. These services may be free to all, free to customers only, or fee-based. A hotspot need not be limited to a confined location. A whole campus or park, or even an entire city can be enabled. Grassroots efforts have led to wireless community networks. High-end mobile phones such as smart phones generally come with Internet access through the phone network. Web browsers such as Opera are available on these advanced handsets, which can also run a wide variety of other Internet software. More mobile phones have Internet access than PCs, though this is not as widely used. An Internet access provider and protocol matrix differentiates the methods used to get online.

Internet Service Providers (ISP): Here is list of some Internet service providers: • • • • • • • • • • • • •

Ak Net http://www.ak.net.pk Apollo Online http://www.apollo.net.pk

Asia Online http://www.aol.net.pk

Aster Net http://www.aster.com.pk Best Net http://www.best.net.pk

Brain Net http://www.brain.net.pk Breeze Net

• • • • • • • • • • • • • • • • • • • • • • • • • • • • • • •

http://www.breeze.net.pk CompuNet Online

• • • • • • • • • • • • • •

Net 21

http://www.compol.com

COMSATS http://www.comsats.net.pk

CubeXS http://www.cubexs.net.pk

CyberAccess http://www.cyberaccess.com.pk

CyberNet http://www.cyber.net.pk

Digicom http://www.digicom.net.pk

Fascom http://www.fascom.com

Gerry's Net http://www.gerrys.net GlobalNet http://www.global.net.pk

IBM http://www.ibm.net

ICNS http://www.icns.com.pk

Info Net http://www.inet.com.pk

Infolink http://www.infolink.net.pk

MegaNet http://www.mega.net.pk

MS Net http://www.ms.net.pk

http://www.net21pk.com

NetAccess http://www.netxs.com.pk

NetAsia http://www.netasia.com.pk

Nexlinx http://www.nexlinx.net.pk Nigsun Online http://www.compcare.com.pk

Pak Net http://www.paknet.ptc.pk Pakistan Online http://www.pol.com.pk

• • • • • • • • • • • • • • • • • • • • • • • • • •

Pienet Global http://www.pienet.net

RoboNet Int'L http://www.robonets.com

SAT COM http://www.sat.com.pk SHOA http://www.shoa.net

Sky Net http://www.netcard.net.pk

Space Net http://www.space.net.pk

SPARCOM http://www.sparcom.net.pk Super Net http://www.super.net.pk

The Flash Net http://www.theflash.net

Top Net http://www.top.net.pk World Online http://www.wol.net.pk

WorldTel Internet http://www.wtmeca.net

Zoooom Net http://www.zoooom.net

ISP in Multan: In Multan •

Super Net

•

Cyber Net

•

Pak Net

•

Wol Net

•

Dancom

•

Comsats

are available.

Electronic Banking:

Pros and cons of e-banking: The biggest plus to banking online is the price. Because Internet-only banks don't have the expense of maintaining hundreds of local branches, their overall cost of doing business is lower than it is for their traditional counterparts. They pass the savings on to consumers in two main ways: higher interest and lower fees. Another big advantage is that you'll have 24-hour access to your account, for free Deposits: Although you may regularly visit your bank branch to make deposits, that's not an option with Internet-only banks. If your employer doesn't offer direct deposit -electronically wiring your paycheck to your bank -- you'll have to use snail mail (the regular old U.S. Postal Service) to get money into your account. If you live paycheck to paycheck, this might be tough for you. You'll have to wait about five business days for your check to get to your account and then another few days for the check to clear. So if you don't have extra money in your account as a cushion, you'll have to factor in the extra time it will take before new deposits are available. And if your check ever gets lost in the mail, you could be out of luck. ATM availability: Check the ATM availability offered by the Internet-only bank you're considering. As you've probably experienced, many banks charge fees to no customers who use their ATMs. Because Internet-only banks don't have their own ATM network, you'll be charged no customer fees by the banks who’s ATMs you use. Internet-only banks are trying to offset this negative by reimbursing account holders for up to four ATM no customer fees per month. That means that even though you'll be charged the no customer fee, the Internet-only bank will give you your money back. Internet-only banks understand these problems, and many are taking steps to overcome them. For example, they're negotiating with large ATM networks to let Internet-only customers make deposits at local ATMs and have those deposits treated just as if they

were made at a local bank. Ask the Internet-only bank you're interested in what they're doing to fix the issues you're most concerned about. You may find you like the answers you're given. To research which Internet bank best suits your banking style, visit Bankrate.com. Don't let your bank get the best of you and your wallet. Instead, flip on your computer and treat yourself to a little more cash The SMS Banking channel also acts as the bank’s means of alerting its customers, especially in an emergency situation; e.g. when there is an ATM fraud happening in the region, the bank can push a mass alert (although not subscribed by all customers) or automatically alert on an individual basis when a predefined ‘abnormal’ transaction happens on a customer’s account using the ATM or credit card. This capability mitigates the risk of fraud going unnoticed for a long time and increases customer confidence in the bank’s information systems. The benefits of electronic transacting have an increasingly important role to play in assisting the small to medium businesses (SMB) sector to run its operations more effectively as well as at a lower cost than traditional financial management mechanisms many of which still revolve around the company chequebook. Addressing this requirement, most banks have introduced systems that are specifically tailored to the needs of the SMB. Perhaps oddly, electronic banking systems have enjoyed particularly good acceptance at what can be considered to be opposite ends of the market - large corporations and private individuals. Large corporations are familiar with the use of electronic payment systems such as magtape and electronic data interchange (EDI), while most individuals are familiar with the Internet and satisfied that the security protecting online banking systems is sufficient to protect their funds. But the SMB environment tends to lag somewhat in the adoption of Internet banking solutions. Most large corporations have invested in software applications such as Enterprise Resource Planning systems, Supply Chain Management systems, Customer Relationship Management systems and more to achieve the benefits associated with process automation. They are also familiar with the benefits of vendor collaboration to

identify solutions that help contain costs, enhance process efficiencies and improve productivity. This was done by granting mutual access to business systems, through interfacing with supplier - such as the ERP system 'talking to' the bank's electronic banking system - to automation aspects of cash management and treasury. However, many SMBs are under the impression that such software applications are too complex and costly for their business requirements, or are not sufficiently confident in the security of online systems. The history of electronic banking systems provided by banks saw these traditionally focused at the money management needs of large corporate. As such, many SMB owners perceive that Internet banking facilities are directed predominantly at larger companies. However, most banking institutions have introduced systems that are specifically directed at the requirements of the SMB, both in terms of functionality and pricing. SMBs that are used to performing simple banking activities, for example viewing account balances and transferring funds between accounts via ATM or phone-banking, can use a multi-user Internet banking platform to perform these banking activities and more via the Internet. At the click of a mouse, SMBs can have easy access to their most updated and detailed financial information anywhere in the world, at anytime. Using such systems also allows the SMB to improve the costs of managing finances - having immediate realtime access to exact available cash positions in their bank accounts supports planning and decision-making, thus resulting in better control over their cash flow. Additionally, human resources is another significant cost centre for most SMBs. With the use of Internet banking, SMBs can cut down on manual processes and deploy staff to do more value-added work. Internet banking allows the SMB to make local or overseas payments to third parties, apply for letters of credit, contract foreign exchange rates and more, improving productivity and saving time by obviating the need to make a trip to the bank branch, stand in a queue and wait for transactions to be processed. It also introduces automation to the payment process - once a beneficiary is created on the system, it is a matter of 'point and click' to effect payment. Contrast these benefits to a cheque-based system, which requires writing the cheque, then delivery or deposit by a driver, or collection by the supplier - an expensive, cumbersome, time- consuming process.

The benefits of using Internet banking systems become even more apparent when it comes to processing urgent and time critical transactions - employees no longer need to rush documents to the bank only to find out that they have missed the cut-off time. The evolution of the services offered by most banks means SMBs should see the bank as far more than just a provider of finance and money handling services. Most leading banks have become a centre from which businesses can source a variety of service offerings and options that can help improve business management. And banks are usually forerunners in technology adoption, such as the implementation of e-business strategies and solutions that help customers improve their financial position. They are also keen to assist their customers to move into Internet-based financial activities. SMBs should therefore make their bankers their financial and business partners in accessing appropriate online banking solutions that can provide better financial management while also offering a lower cost of banking.

Types of e-banking: Following are the types of e-banking •

Internet banking

•

Mobile banking

•

ATM

•

Telephone banking

Internet Banking: Internet banking refers to the use of the Internet as a remote delivery channel for banking services. Such services include traditional ones, such as opening a deposit account or transferring funds, among different accounts, and new banking services, such as electronic bill payment, allowing customers to receive and pay bills via a bank’s website. Banks offer Internet banking in two main ways. An established bank with physical offices can establish a website and offer Internet banking to its customers in addition to its traditional delivery channels. A second alternative is to establish a “virtual,” “branchless,” or “Internet-only” bank. The computer server that lies at the

heart of a virtual bank may be located in an office that serves as the legal address of such a bank, or at some other location. Virtual banks may offer their customers the ability to make deposits and withdraw funds via ATMs or other remote delivery channels owned by other institutions.

Features: Internet banking has following features

Time and Space: By eliminating the limitations of time and distance, electronic financial transactions can make cross-border transactions easier and thus make it possible to provide services to customers on a global scale. In effect, online finance may eventually lead to complete globalization of financial services, making the national borders irrelevant.

Electronic financial transactions: Electronic financial transactions have helped create new services such as the “virtual financial site” that includes services crossing the traditional borders between financial services as well as “aggregation” that allows consumers to obtain consolidated information about their financial accounts in one place. o

Electronic bill presentment and payment - EBPP

o

Funds transfer between a customer's own checking and savings accounts, or to another customer's account

o

Investment purchase or sale

o

Loan applications and transactions, such as repayments

Security: Since electronic financial transactions, especially those in online retail banking, are being conducted on open networks centered on the Internet, many challenges arise in terms of transaction security, consumer protection and privacy. The existing systems of financial regulation and supervision are being amended to reflect the changes in technology.

Online banking user interfaces are secure sites and traffic of all information including the password - is encrypted, making it next to impossible for a third party to obtain or modify information after it is sent. However, encryption alone does not rule out the possibility of hackers gaining access to vulnerable home PCs and intercepting the password as it is typed in (keystroke logging). There is also the danger of password cracking and physical theft of passwords written down by careless users. Many online banking services therefore impose a second layer of security. Strategies vary, but a common method is the use of transaction numbers, or TANs, which are essentially single use passwords. Another strategy is the use of two passwords, only random parts of which are entered at the start of every online banking session. This is however slightly less secure than the TAN alternative and more inconvenient for the user. A third option is providing customers with security token devices capable of generating single use passwords unique to the customer's token (this is called two-factor authentication or 2FA). Another option is using digital certificates, which digitally sign or authenticate the transactions, by linking them to the physical device (e.g. computer, mobile phone, etc). Other banks have responded not with security tokens or digital certificates, but by setting up a combination of controls that recognize a customer's computer, ask additional challenge questions for risky behavior, and monitor for fraud ulent behavior

Electronic Fund Transfer: Electronic funds transfer or EFT refers to the computer-based systems used to perform financial transactions electronically. The term is used for a number of different concepts: •

cardholder-initiated transactions, where a cardholder makes use of a payment card

•

electronic payments by businesses, including salary payments

•

electronic check (or cheque) clearing

Card Based EFT: EFT may be initiated by a cardholder when a payment card such as a credit card or debit card is used. This may take place at an automated teller machine (ATM) or point of sale (EFTPOS), or when the card is not present, which covers cards used for mail order, telephone order and internet purchases.

Transaction types A number of transaction types may be performed, including the following: •

Sale: where the cardholder pays for goods or service.

•

Refund: where a merchant refunds an earlier payment made by a cardholder.

•

Withdrawal: the cardholder withdraws funds from their account, e.g. from an ATM. The term Cash Advance may also be used, typically when the funds are advanced by a merchant rather than at an ATM.

•

Deposit: where a cardholder deposits funds to their own account (typically at an ATM).

•

Cashback: where a cardholder withdraws funds from their own account at the same time as making a purchase.

•

Inter-account transfer: transferring funds between linked accounts belonging to the same cardholder

•

Payment: transferring funds to a third party account

•

Inquiry: a transaction without financial impact, for instance balance inquiry, available funds inquiry, linked accounts inquiry, or request for a statement of recent transactions on the account.

•

Administrative: this covers a variety of non-financial transactions including PIN change. The transaction types offered depend on the terminal. An ATM would offer different transactions from a POS terminal, for instance

Online banking puts the power of banking into the hands of the customer and allows the customers to self-service themselves with all their banking needs, just as customers have become used to getting money from an ATM instead of going to the cash desk in the bank. With this online service, customers can view their account details, review their account history, transfer funds, order checks, pay bills, re-order checks and get in touch with the customer care department of the bank. In most cases, there is no special software to install other than a web browser and many banks do not charge for this service

Mobile Banking: Mobile banking is a term used for performing balance checks, account transactions, payments etc. via a mobile device such as a mobile phone. Mobile banking today (2008) is most often performed via SMS or the Mobile Internet but can also use special programs downloaded to the mobile device. Mobile Banking can be said to consist of three inter-related concepts: •

Mobile Accounting

•

Mobile Brokerage

•

Mobile Financial Information Services

Most services in the categories designated Accounting and Brokerage are transactionbased. The non-transaction-based services of an informational nature are however essential for conducting transactions The accounting and brokerage services are therefore offered invariably in combination with information services. Information services, on the other hand, may be offered as an independent module.

Trends in mobile banking: The advent of the Internet has revolutionized the way the financial services industry conducts business, empowering organizations with new business models and new ways to offer 24x7 accessibility to their customers. The ability to offer financial

transactions online has also created new players in the financial services industry, such as online banks, online brokers and wealth managers who offer personalized services, although such players still account for a tiny percentage of the industry. Over the last few years, the mobile and wireless market has been one of the fastest growing markets in the world and it is still growing at a rapid pace. According to the GSM Association and Ovum, the number of mobile subscribers exceeded 2 billion in September 2005, and now exceeds 2.5 billion (of which more than 2 billion are GSM).According to a study by financial consultancy Celent, 35% of online banking households will be using mobile banking by 2010, up from less than 1% today. Upwards of 70% of bank center call volume is projected to come from mobile phones. Mobile banking will eventually allow users to make payments at the physical point of sale. "Mobile contact less payments” will make up 10% of the contact less market by 2010.Many believe that mobile users have just started to fully utilize the data capabilities in their mobile phones. In Asian countries like India, China, Indonesia and Philippines, where mobile infrastructure is comparatively better than the fixed-line infrastructure, and in European countries, where mobile phone penetration is very high (at least 80% of consumers use a mobile phone), mobile banking is likely to appeal even more. This opens up huge markets for financial institutions interested in offering value added services. .Mobile devices, especially smart phones, are the most promising way to reach the masses and to create “stickiness” among current customers, due to their ability to provide services anytime, anywhere, high rate of penetration and potential to grow.

Features: Mobile banking can offer services such as the following:

• Account Information Alerts on account activity or passing of set thresholds 1. Monitoring of term deposits 2. Access to loan statements 3. Access to card statements

4. Mutual funds / equity statements 5. Insurance policy management 6. Pension plan management 7. Status on cheque, stop payment on cheque

Payments & Transfers 1. Domestic and international fund transfers 2. Micro-payment handling 3. Mobile recharging 4. Commercial payment processing 5. Bill payment processing 6. Peer to Peer payments

Investments 1. Portfolio management services 2. Real-time stock quotes 3. Personalized alerts and notifications on security prices

Support 1. Status of requests for credit, including mortgage approval, and insurance coverage 2. Check (cheque) book and card requests 3. Exchange of data messages and email, including complaint submission and tracking 4. ] ATM Location

Content Services 1. General information such as weather updates, news 2. Loyalty-related offers 3. Location-based services

Based on a survey conducted by Forrester, mobile banking will be attractive mainly to the younger, more "tech-savvy" customer segment. A third of mobile phone users say that they may consider performing some kind of financial transaction through their mobile phone. But most of the users are interested in performing basic transactions such as querying for account balance and making bill payment.

ATM: An automated teller machine (ATM) is a computerized telecommunications device that provides the customers of a financial institution with access to financial transactions in a public space without the need for a human clerk or bank teller. On most modern ATMs, the customer is identified by inserting a plastic ATM card with a magnetic stripe or a plastic smartcard with a chip, that contains a unique card number and some security information. Security is provided by the customer entering a personal identification number (PIN). Mechanical cash dispenser was developed and built by Luther George Simian and installed in 1939 in New York City by the City Bank of New York, but removed after 6 months due to the lack of customer acceptance. The ATM got smaller, faster and easier over the years. Thereafter, the history of ATMs paused for over 25 years, until De La Rue developed the first electronic ATM, which was installed first in Enfield Town in North London on 27 June 1967 by Barclays Bank.. This instance of the invention is credited to John Shepherd-Barron, although various other engineers were awarded patents for related technologies at the time. Shepherd-Barron was awarded an OBE in the 2005 New Year's Honors List. The first person to use the machine was Reg Varney of "On the Buses" fame, a British Television programme from the 1960s. The first ATMs accepted only a single-use token or voucher, which was retained by the machine. These worked on various principles including radiation and low-coercively magnetism that was wiped by the card reader to make fraud more difficult. The idea of a PIN stored on the card was developed by the British engineer John Rose in 1965.

ATMs first came into wide UK use in 1973; the IBM 2984 was designed at the request of Lloyds Bank. The 2984 CIT (Cash Issuing Terminal) was the first true Cash point, similar in function to today's machines; Cash point is still a registered trademark of Lloyds TSB in the U.K. All were online and issued a variable amount which was immediately deducted from the account. A small number of 2984s were supplied to a USA bank.

Using an ATM, customers can access their bank accounts in order to make cash withdrawals (or credit card cash advances) and check their account balances. ATMs are known by various casual terms including automated banking machine, money machine, cash machine, hole-in-the-wall.

Telephone banking: The Enhanced Telephone is a telephone developed by Citibank in the late 1980s for customers to do banking and other financial transactions from their home. The official launch date was February 26-27, 1990.The first version of the Enhanced Telephone, the 99A model, was beige and featured a monochrome CRT screen. Because of its chunky appearance, several developers dubbed it the "sawed-off ski boot. The physical hardware was manufactured by Transaction Technologies Incorporated (TTI).The second version of the Enhanced Telephone, the P100 model, was manufactured by Philips Electronics and featured an LCD screen and sleeker styling. The font was developed by Bit stream Inc. Software for the Enhanced Telephone was written in a proprietary language called HAL (Home Application Language).The Enhanced Telephone ultimately failed to become a viable product because by the time it was introduced, home banking via PCs was becoming more common. As the World Wide Web became popular in the early 1990s, the

Enhanced Telephone was rendered obsolete. The Philips P100 phone lived on and to this day variations of it are used for other applications Online lenders make loans to consumers via computer websites, online. Online lenders generally provide loan information, application forms, email or instant message assistance right on their website. The online applications are generally transmitted over an encrypted web page for security. Ideally an online lender will provide a telephone number prominently offering offline assistance to consumers also Telephone banking is a service provided by a financial institution which allows its customers to perform transactions over the telephone. Most telephone banking uses an automated phone answering system with phone keypad response or voice recognition capability. To guarantee security, the customer must first authenticate through a numeric or verbal password or through security questions asked by a live representative (see below). With the obvious exception of cash withdrawals and deposits, it offers virtually all the features of an automated teller machine: account balance information and list of latest transactions, electronic bill payments, funds transfers between a customer's accounts, etc. Usually, customers can also speak to a live representative located in a call centre or a branch, although this feature is not guaranteed to be offered 24/7. In addition to the self-service transactions listed earlier, telephone banking representatives are usually trained to do what was traditionally available only at the branch: loan applications, investment purchases and redemptions, chequebook orders, debit card replacements, change of address, etc. Banks which operate mostly or exclusively by telephone are known as phone bank.

Difference b/w traditional and e banking: Internet banking works much like traditional banking. The primary difference is you are accessing your account and information, making payments and reconciling statements using your computer rather than paper or the phone to complete transactions. Instead of going down to your local branch office when you bank online you can accomplish multiple tasks at once with the click of a button.

Online banking is rapidly becoming more and more popular as consumers recognize the advantages online banking has to offer. For one most banks charge fewer fees if you take advantage of their online banking services. You can also stop receiving paper statements if you like in many cases and conduct 95% of your business over the Web when you take advantage of Internet banking.

What Internet Banks Do? What to Internet Banks do? The same things traditional banks do. They hold onto our money and lend it out to others respectively. The manage loans and help us keep track of our finances. Chances are if you own a bank account at a traditional bank they offer some type of Internet banking or online services. The next time you stop into your branch office you should ask them about online banking. You may find once you start you have no desire to go back to traditional banking. For those that have a hard time keeping track of paper statements, Internet banking is a life saver. Internet banking is also advantageous for frequent travelers that need to keep a close eye on their finances from abroad.

Literature Review Case Study: Analyzing the Factors that Influence the Adoption of Internet Banking in Mauritius Kesseven Padachi, Sawkuk Rojid, and Boopen Seetanah School of Public Policy & Management, University of Technology, Mauritius, Pointes-Aux-Sables, Mauritius [email protected]; [email protected]; [email protected]

Conclusion: This study investigated the factors that influence the adoption of internet banking for the case of the emerging African economy of Mauritius. Mauritius provides a good case study as the country is actually one of the best performers of the continent and moreover has a relatively well developed financial system and communication technology as well. Specifically this work analyzed in the first instance the most widely use internet banking services and subsequently investigated the relative importance of elements such as accessibility and cost of computers and internet, customers reluctance, awareness of the service, security of internet banking transactions, convenience and ease of use influence the usage of Internet banking. Using survey analysis, results shows that the mostly used services are inter account transfer, payment to other personal account, transfer to credit card account, recharge mobile phones, standing order transactions, savings, current and fixed

deposit account application and debit/ credit card. The results are confirmed by the use of t-tests. Comparing demographic variables of the internet banking users to the non-internet banking users, the analysis shows that there is no significant difference between the two groups of users, for the variable age group and the education level of the respondents. This is however not the case for the mean monthly income. Using factor analysis to identify the factors affecting the adoption of internet banking in Mauritius we found that the most significant factor is ease of use and that other important elements are reluctance to change, trust and relationship in banker, cost of computers, Internet accessibility, convenience of use and security concerns. Further analysis using cross tabulations relating selected factors and usage of internet banking facilities detected the presence of important statistical relationship between awareness, access to Internet facility, length of banking relationship, people working in the Internet banking/finance sector, education level in the category ‘post graduate’ and also income group with the usage of internet banking. The results will have important implications and is believed to be very helpful for the Mauritian banking sector and also for the government since both will be aware of the relatively important elements that should be taken into account to formulate appropriate strategies, foster this service and thus reaping out its benefits. While this exploratory research has revealed some interesting results, one should be careful on some of its limitations related essentially to its sample size. Although we believe that this study is quite deep, we still believe that it can be further extended

to include more respondents from different sectors and age groups to make it more realistic and more reliable from the perspective of policy analysis. Moreover, analysis can be made for different age groups and possible people working in different sectors to capture the micro details of Internet banking. There exist in the literature similar works on different countries. Perhaps it might be interesting to survey these studies and make a comparison to see whether there exist major differences in different countries. Finally a regression analysis can be performed to find out the main determinants affecting Internet banking in Mauritius.

Research Design

Steps involved in Research Process: 1) Defining the problem: E-banking ( Electronic Banking ) `is the most growing field of today. E-banking is well established and is being used heavily throughout the world. But in our city Multan it is not that much popular. People are sill unaware of the facilities provided by banks electronically or there may be some faults in the services provided by the banks or there could be some other reasons. The point of focus is that e-banking is not much popular in Multan. People are not enjoying the great facilities of ebanking. Majority of population Is using old, traditional way of banking. They feel it more convenient and reliable by going to banks themselves and made their payments or depositing cash or having some withdrawals etc. The question is where the problem exists, it can be •

Unawareness

•

Hesitation to new technology

•

Unavailability of resources

•

Difficulty in understanding the terminologies

•

Users expect more

etc.

Problem Statement:

“Reason behind less popularity of e-banking in Multan.” 2) Planning a Research Design: Research design is the master plan specifying the methods and procedures for collecting and analyzing the needed information. There are four types of research design, •

Survey ( Interview, Questionnaire)

•

Experiment (Laboratory, Field)

•

Secondary Data

•

Observation

We have chosen survey, survey is a research technique in which information is gathered from a sample of people using a questionnaire or by conducting interviews. We have surveyed different banks, users and nonusers of e-banking, to get information about the actual reason behind less popularity of e-banking in Multan. We have used questionnaire and also conducted interviews to fulfill our purpose. We use questionnaire for users and non users of e-banking and conducted interview of employees of banks. Reason: We have used questionnaire because

•

Questionnaires are preplanned (structured).

•

Provide accurate data.

•

Provide concise and appropriate information.

•

Good respondent cooperation.

•

Data analysis is easy.

•

Low item no response.

We have conducted interviews because

•

Interviews provide versatility of questioning.

•

Provide special features like visual material etc.

•

Degree of interviewer influence on answers is high.

•

Respondent cooperation is excellent.

•

Speed of data collection is good.

•

Item non response rate is low.

3) Planning a Sample: We have selected a sample size of 100, In which 20 are employees, 40 users and 40 non users. We have visited 10 banks in different areas of Multan.

4) Data Collection: The data we have collected has both qualitative and quantitative significance. Our questionnaire contained close ended questions mostly. We have visited each bank and conducted interviews to get appropriate information about the views and experiments of employees of banks about low popularity of e-banking. They provided us with trend toward e-banking in Multan. Questionnaires provided us very accurate and to the point views of users and non users toward e-banking.

5) Data analysis and conclusion: To analyze the data we have uses SPSS software, and have find the conclusions carefully from that information.

6) Report preparation: We have prepared report very carefully by using MS Word. We have written each and evey thing without any ambiguity. Every point is mirror clear.

Introduction of Banks Askari Bank Askari Bank Limited Type Private Founded October 09, 1991 Headquarters Rawalpindi, Pakistan Lt. Gen. Waseem Ahmed Ashraf, Chairman Key people & CEO Industry Products Revenue Net income Total assets Employees Website

M. R. Mehkari (Acting) Money Center Banks Banking ▲Rs 5.453 billion PKR (2005) ▲Rs 2.022 billion PKR (2005) Rs. 145.1 billion PKR (2005) 2,754 (2005) www.askaribank.com.pk

Askari Bank Ltd (formerly Askari Commercial Bank) was incorporated in Pakistan on October 9, 1991, as a Public Limited Company. It started its operations during April 1, 1992. The bank principally deals with mainly banking, as defined in the Banking Companies Ordinance, 1962. The Bank is listed on the Karachi, Lahore & Islamabad Stock Exchanges and its shares are currently the highest quoted from among the new private sector banks in Pakistan. Askari Bank has expanded into a nation wide presence of 136 branches, and an offshore banking Unit in Bahrain. A shared network of over 1,100 online ATMs covering all major cities in Pakistan supports the delivery channels for customer service. As on December 31, 2005, the bank had equity of PKR 8.6 billion and total assets of PKR 145.1 billion, with over 600,000 banking customers, serviced by our 2,754 employees.

Mission: To be the leading private sector bank in Pakistan with an international presence, delivering quality service through innovative technology and effective human resource management in a modern and progressive organizational culture of meritocracy, maintaining high ethical and professional standards, while providing enhanced value to all our stake-holders, and contributing to society.

Internet banking: Askari Bank has also introduced online banking. Customers are able to view their bank information and use their accounts for money transfer and use other features. •

Board of directors

Lt. Gen. Farooq Ahmed Khan Gurmani - Chairman •

Lt. Gen. Waseem Ahmed Ashraf - Chairman

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Lt. Gen. (R) Zarrar Azim - Chairman Executive Committee

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Mr. M.R Mehkari - Acting President & Chief Executive

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Brig (R) Muhammad Shiraz Baig - Director

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Brig (R) Asmat Ullah Khan Niazi - Director

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Brig (R) Muhammad Bashir Baz - Director

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Brig (R) Shaukat Mahmood Chaudhari - Director

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Mr. Zafar Alam Khan Sumbal - Director

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Mr. Kashif Mateen Ansari - Director

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Mr. Muhammad Najam Ali - Director

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Mr. Muhammad Afzal Munif - Director

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Mr. Tariq lqbal Khan - Director (NIT Nominee) .

Bank Alfalah Bank Alfalah Limited Type Private Founded Karachi Headquarters Principal Office, Karachi Pakistan H.E. Sheikh Hamdan Bin Mubarak Al Key people Nahayan (Chairman) Banking Industry Capital Markets Loans, Credit Cards, Savings, Consumer Products Banking etc. Revenue ▲PKR 25.783 Billion (2007) Net income ▲PKR 3.130 Billion (2007) Website www.bankalfalah.com

Bank Alfalah Limited is a private bank in Pakistan owned by the Abu Dhabi Group. Bank Alfalah was incorporated on June 21, 1997 as a public limited company under the Companies Ordinance 1984. Its banking operations commenced from November 1, 1997. The bank is engaged in commercial banking and related services as defined in the Banking companies ordinance, 1962.

History Bank Alfalah Limited was launched on June 21, 1997 as a public limited company under the Companies Ordinance 1984. The bank commenced its operations on November 1, 1997. The bank introduced commercial banking and related services as defined in the Banking companies ordinance, 1962. After a few years, the bank introduced its new identity of H.C.E.B after the privatization in 1997. The management of the bank had implemented strategies and policies so the bank would become a major player in the market. With a partnership with the Abu Dhabi Group the position of the bank became stronger which allowed the bank to invest more in revolutionary technology to increase its range of products and services.

Mission statement: To develop and deliver the most innovative products, manage customer experience, deliever quality service that contribute to brand strength, develop a competitive advantage and enhance profitabilty, thus providing value to the stakeholders of the bank.

Branches: The bank is currently operating through 195 branches in 74 cities, with the registered office at B.A.Building, I.I.Chundrigar, Karachi. Some of the main branches are located in all of the major cities including: Lahore, Kasur, Islamabad, Gawadar, Peshawar, Faisalabad, Quetta, D.I.Khan, Rawalpindi, Sargodha, Sukkur, Sialkot, Multan, Murree, Attock District, Gujranwala etc.

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Habib Bank Ltd. HBL

Habib Bank

Type Public Limited Company Founded Bombay (now Mumbai), in 1941. Headquarters Habib Bank Plaza, Karachi, Banking Industry Capital Markets Loans, Credit Cards, Savings, Consumer Products Banking etc. Revenue ▲PKR 50.481 bn (USD 814.2 mln) – 2007 Net income ▲PKR 10.084 bn (USD 162.6 mln) - 2007 Website www.habibbankltd.com

Limited (commonly referred to as "HBL") (Urdu: ‫)حَبيب بينك‬, headquartered in Habib Bank Plaza, Karachi, Sindh, is the largest bank in Pakistan. The bank has a network of 1425 branches in Pakistan and 55 branches worldwide. It has a domestic market share of over 40%. It continues to dominate the commercial banking sector with a major market share in inward foreign remittances (55%) and loans to small industries, traders and farmers. Overseas, it has operations in the following countries:

Mission To be recognized as the leading financial institution of Pakistan and a dynamic international bank in the emerging markets, providing our customers with a premium set of innovative products and services, and granting superior value to our stakeholders – shareholders, customers and employees.

History

The branches of Habib Bank in Pakistan •

1941 Mohammed Ali Jinnah, Pakistan's founding father, realized the importance of financial intermediation while he was campaigning for the creation of a separate homeland for the Muslims of India. He persuaded the Habib family to establish a commercial bank that could serve the Indian Muslim community. His initiative resulted in the creation of Habib Bank, with HO in Bombay and fixed capital of 25,000 rupees. The bank played an important role in mobilizing funds from the Muslim community to finance the All-India Muslim League's campaign

for the establishment of Pakistan. Habib Bank also played an important role in channeling relief funds to the people hurt in the communal riots and violence that preceded the departure of the British from India. Habib Bank Limited established itself in Bombay (now Mumbai) in 1941. After Pakistan was born in 1947, Habib Bank, at the urging of Governor-General Jinnah, moved its headquarters to Karachi, Pakistan's first capital. The Habib family owned and managed the bank until the Pakistan government nationalized it on 01 January 1974.

Muslim Commercial Bank

MCB Bank Limited (Formerly Muslim Commercial Bank) Type Private Founded Lahore Registered Office: Islamabad, Principal Headquarters Office: Lahore Pakistan Key people Mian Mohammad Mansha (Chairman) Banking Industry Capital Markets Loans, Credit Cards, Savings, Consumer Products Banking etc. Revenue ▲PKR 31.787 Billion (2007) Net income ▲PKR 15.266 Billion (2007) Website www.mcb.com.pk

Muslim Commercial Bank Limited was incorporated by the Adamjee Group on July 9, 1947 under the Indian Companies Act, VII of 1913 as a Limited Company. The bank was established with a view to provide banking facilities to the business community of the sub-continent. The bank was nationalized in 1974 during the government of Zulfiqar Ali Bhutto. This was the first bank to privatized in 1991 and the bank was purchased by a consortium of distinguished Pakistani corporate groups, led by Nishat

Group. Currently the Nishat Group owns a majority stake in the bank. The president of the bank is Mr. Atif Bajwa (previously with Citibank) and the Chairman is Mian Mohammad Mansha. .

National Bank of Pakistan National Bank of Pakistan Private Type KSE: NBP LSE: Founded Karachi Headquarters Principal Office, Karachi Pakistan Key people S Ali Raza (Chairman) Banking Industry Capital Markets Loans, Credit Cards, Savings, Consumer Products Banking etc. Revenue ▲PKR 50.569 bn (USD 815.6 mln) – 2007 Net income ▲PKR 19.034 bn (USD 307 mln) - 2007 Website www.nbp.com.pk

The National Bank of Pakistan has its headquarters in Karachi, Pakistan. It has over 1,200 branches throughout Pakistan. The bank provides both commercial and public sector banking services. It has assets worth USD 12.293 billion in 2007. Its subsidiaries include NBP Capital, NBP Modaraba Management Company, NBP Exchange Company, Taurus Securities, NBP Almaty et al.

Vision To be recognised as a leader and a brand synonymous with trust, highest standards of service quality,international best practices and social responsibility.

Mission NBP will aspire to the values that make NBP truly the Nation's Bank by: • Institutionalising a merit and performance culture. • Creating a distinctive brand identity by providing the highest standards of services. • Adobting the best international nanagement practices. • Mazimizing stakeholder’s value. • Dischargeing our responsibility as a good corporate citizen of Pakistan and countries where we operate.

Board of Directors •

S Ali Raza - Chairman & President

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Mian Kausar Hameed - Director

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Mr. Ibrar A. Mumtaz - Director

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Mr. Tariq Kirmani - Director

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Sikandar Hayat Jamali - Director

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Azam Faruque - Director

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Ekhlaq Ahmed - Secretary Board of Directors

History •

1949 National Bank of Pakistan (NBP) was established under the National Bank of Pakistan Ordinance 1949 and was 100% govt.-owned. NBP acted as an agent of the Central Bank wherever the State Bank did not have its own Branch..

Standard Chartered Pakistan Type Private Founded 2006 Principal Office Headquarters Karachi Pakistan Key people Badar Qazmi CEO, SCBPL Banking Industry Global Markets Loans, Credit Cards, Savings, Consumer Products Banking etc. Revenue (PKR) Website www.standardchartered.com/pk/

Standard Chartered Bank (Pakistan) Limited is Pakistan's oldest and largest foreign bank with over 150 branches in the country. The history of Standard Chartered in Pakistan dates back to 1863, when the Chartered Bank of India, Australia and China first established its operations in Karachi. In 2006 Standard Chartered Bank acquired Pakistan's Union Bank. On 30 December 2006, Standard Chartered merged Union Bank with its own subsidiary, Standard Chartered Bank (Pakistan), to create Pakistan's sixth largest bank.

Type Public 1989 Founded Lahore, Pakistan Headquarters Lahore, Pakistan Shahzad Hassan Pervez, Chairman Key people Sajjad Hussain, President Industry Banking, Finance and Insurance Products Financial Services Website

Bank of Punjab The Bank of Punjab is a bank based in Lahore, Pakistan serving the entire country.

History: Established in 1989, in pursuance of The Bank of Punjab Act 1989 and was given the status of scheduled bank in 1994. It is not the same institution as the former Bank of Punjab Ltd. in India, which merged with Centurion Bank to become Centurion Bank of Punjab.

United Bank Ltd. Type Public Founded November 7, 1959 Headquarters Karachi, Pakistan His Highness Shaikh Nahayan Mabarak Al Nahayan, Chairman Key people Sir Mohammed Anwar Pervez OBE, Deputy Chairman Agha Hasan Abedi, Founder Industry Finance Commercial Banking, Private Banking, Products Asset Management Revenue ▲PKR 41.962 bn 2007 Net income ▲PKR 9.237 bn 2007 Website www.ubl.com.pk

United Bank Limited (UBL) is one of the largest commercial banks in Pakistan having more than 1,000 branches inside the country. Its 15 branches outside the country are in the United States of America, Qatar, UAE, Bahrain, and Republic of Yemen. It also has representative offices in Teheran, Iran, and Almaty, Khazakstan. Agha Hasan Abedi founded the bank in 1959. In 1971 the Government of Pakistan nationalized it. In 2002, the Government of Pakistan sold it in an open auction to a consortium of Abu Dhabi Group and Bestway Group. Since its privatization the bank has been successfully turned around and remains a robust and strong performer in all major segments of its operations.

Online banking: UBL’s state of the art online banking, customers were able to access their account from more than 350 branches located in 71 cities across Pakistan. Transactions such as Cash Deposit, Cheque Encashment, Stop Payment, Account Statement, Funds Transfer were done online without the need to travel to the local branch.

Board of Directors: •

His Highness Shaikh Nahayan Mabarak Al Nahaan - Chairman

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Sir Mohammed Anwar Pervez OBE - Deputy Chairman

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Mr. Atif R. Bokhari - President & CEO

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Mr. Omar Ziad Jaafar Al Askari - Director

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Mr. Zameer Mohammed Choudrey - Director

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Mr. Ahmad Waqar - Director

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Dr. Ashfaque Hasan Khan - Director

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Mr. Aqeel Ahmed Nasir - Company Secretary & Chief Legal

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Mr. Abdul Rauf Malik - Director

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Mr. Aameer Karachiwalla - SEVP/Group Chief Financial Officer

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Mr. Ejazuddin - Group Exective/Audit & Inspection Group

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Mr Salahudin Khan ( AVP )