University of bahrain
department of english
english academic writing final project
Customers Perception of Security and Effectiveness Online Banking services
Submitted to DR. Yasser
This study aims to examine the e-banking security in the perception of the users in issues like security and effectiveness. The study uses secondary data through the collection of past studies about the same topic, as well as primary data through a designed survey. The survey was developed and disseminated online on a random sample. The sample size of the study is 80 responses, all of them were accepted. The findings of the study revealed that people in Bahrain feel secure about using the online services of banks such as paying their bills and transferring money from one account to another. Moreover, the study showed that customers perceived some disadvantages when it comes to online banking such as lack of information. The study finally suggests way for banks to improve their e-banking services to meet the demand of their customers.
The sensational development of ebanking has changed the manner by which banks and customer interact. The larger part of customers’ connects with their specialist organizations happen online by means of the favored program in which progressively going to versatile stages. Client confirmation remains an establishment for PC security and passwords, in mix with different measures, stays basic to distinguish and validate ebanking customers (Conklin et al., 2004).
As the client of ebanking creates security matters identifying with secrecy, respectability, and protection have turned into a dynamically more prominent worry to customers and banks. Banks perceive the advantage, as expanded effectiveness and client comfort to use this service wherever he is. In spite of this developing pervasiveness of ebanking management, the safety of using this service is still a matter and a concern to few people at the moment.
As exchanges of informations in banks shifted from traditional banks locations and branches to the online world, therefore, hacker and criminals also did so (Rice, 2012).
In the same manner, this exponential development in ebanking has been with a similarly quick and inside and out all the more aggravating ascent in area misrepresentation. As cash money is the issue at the moment, hackers have developed their capabilities and power to penetrate any system and protection to conduct fraud.
An example of how banks are making their e-banking service secure; Umpqua Bank in the United States, the bank is using different security processes in which customers have to go throw to conduct their online banking services. the aim is to decrease and eliminate fraud from the system. The following steps are the ones used by the bank to ensure safe online banking services for their customers (Umpqua Bank Website, 2018);
Advanced Login Authentication is a requirement today in almost every online banking service in which it will require to enter an ID ; password, and it utilizes complex devices recognizable proof procedures at each login. In the event that the devices can’t be distinguished, at that point the person signing in is required to enter another security code.
However after that the user is required to enter a security code that could be characterized in a message or call, in order to proceed and log in. This service or authentication called the out of band. Finally, after the completion of these steps, the user will have the ability to log in to the account.
Transaction Monitoring – Banks, almost using this method to identify and establish typical transaction for the consumers of the bank. This monitoring services shows up each outgoing wire transaction that fits within acceptable parameters of typical usage. Notice that unusual transactions that might be not in condition way, case the system to seek additional approval behind the scenes from the bank before releasing the transaction.
Out-of-Band Transaction Approval is adding more steps in verifications especially when endorsing active financial exchange. The mean in which these verification step is done is either by text message or a voice call and it is required before conducting the monetary transaction online. The transaction will not successfully complete unless the verification code is correct.
This research at hand shades the light on how people in Bahrain are using the online banking services and whether they feel safe about it. As the banks have moved their services to the online world; consumers also enjoys the privileges of conducting online transaction at their comfort. The study will provide insight information to banks on how consumers of online banking services feel towards security matters
1.2 Research Question
The research questions are as follow;
Does people in Bahrain are familiar and using in the E-banking?
What are the transactions people in Bahrain conduct using E-banking?
Do people in Bahrain feel secure while conducting E-banking transaction?
1.3 Research Purpose
The research aims to achieve the following
Explore the security issues of E-banking
Provide the banks in Bahrain with insight information about how their customers are using the online banking services of theirs.
Recommend ways for banks in Bahrain to offer more services that their customers could use.
1.4 Research Methodology
As to support the aims of this research; the study gathered primary data through a design questionnaire that asked customers of banks about how they use the online features of banks and whether they feel safe to do so. The study gathered 73 responses in which all of them were accepted. The questionnaires collected were analyzed logically and presented in graph and findings were analyzed and discussed to accomplish the objectives of the study.
Security is an essential in the banking industry and progressively vital in it present (Kanniainen, 2010). In the course of the most recent couple of years, the quantity of fake exchanges submitted by outsiders increased colossally. Subsequently, extortion counteractive action has turned into a focal worry to banks and clients (Sullivan, 2010). As banks fraud may at last influence client relationship quality and client dedication, misrepresentation counteractive action and its compelling correspondence is a critical point for researchers nowadays.
Both banks and their clients are affected by the fraud. Banks bring about significant working expenses by discounting clients’ financial misfortunes (Gates and Jacob, 2009). On the other hand bank clients encounter impressive time and enthusiastic misfortunes. it usually goes through a process that starts with figuring out the fraudulent transactions and then send the information to the bank, after that the bank will have to do certain transaction of opening and closing card balanced to repay the account holder the losses incurred (Douglass, 2009). Being a victim of fraud crime will likewise affect clients’ view of feeling secure and ensured. In like manner, misrepresentation may harm the Relationship between banks and clients in view of the failure to protect their belongings (Krummeck, 2000), and additionally expanded disappointment as a result of an apparent failure of bank management (Varela-Neira et al., 2010). This, thusly, may contrarily influence client dedication and animate exchanging conduct (Gruber, 2011), along these lines harming the banks’ notoriety and blocking the fascinations of acquiring more clients.
E-banking forces most money establishments to re-examine their systems and practices and to appear for new ways in which to deliver their services over the online. to try to that effectively they get to boost work flow, cut back paper work, offer on-line document imaging for users and make trade wide standards so as to boost value efficiencies and profitableness. This results in several technical, social control and strategic problems.
2.1 Consumers perception of E-banking and Past Studies
This section of the research discusses studies that are similar to our topic of research in which it was conducted by different authors around the world to explore the security of e-banking from customers’ perspective.
In a study that was conducted by Sanches and Jean-Baptiste (2010), they have explored the elements in which it increased the customers adopting the online services more often. The study of theirs conducted in France and aimed to discuss the difference and compare it with banks in Mexico. The sample size of their study was 398 users of French Banks. They havel concluded that there are at least five factors that were significant too customers in their adoption to ebanking, groups influence, third party concerns, trust, compatibility and difficulty.
Different studies have been conducted to know the reason behind adopting the ebanking, and in a study conducted by Wu et al. (2010) they have studied the customers perception of online banking and why they are adopting it, their sample size was 196 customers using ebanking and concluded that the reason behind using the ebanking is that it provides them with benefits that exceeds it concerns. In contrast other studies found that the reason behind not using the online banking is that it lacks information and guidance toward conducting the service that customers want (Dospinescu & Popescul, 2005).
This study aims to explore the security of e-banking as perceived by consumers and user of online banking services in Bahrain. As for that, the study collected primary data through a designed questionnaire. The questionnaire used different approaches and questions such as close ended and likert-scale question of 5 levels. The questionnaire was designed through Google Survey online and disseminated by using social media applications as to foster the collection and cover a wider population of respondents.
The survey was disseminated randomly and collected 80 responses in which they were all complete and accepted to form the sample for this research. The survey collected 50 responses from females and 30 from males. And the majority responses were coming from those between the ages 18 to 24 years old with 42 responses.
Few questions from the survey are listed below;
Is it easy to use electronic banking?
Do you feel secure when transfer the money from account to other?
What is the online service that you do?
What are for you the two main disadvantages of online banking?
See appendix for full questionnaire
This section of the research discusses the results collected from the survey which are listed in graphs (see Appendix A).
The results of this study are based on sample size of 80 responses that were collectd randomly from people living in Bahrain. The results shows that the majority of the respondents were female with 62.5 percent while male represented by 37.5 percent. The higher responses came from respondents aged between 18 to 24 years old with 52.5 percent; followed by respondents between 25 to 30 years old. While the least responses came from those whom are above 55 years old 4 percent.
When it comes to the educational level of respondents, majority of them were graduated with 51.2 percent. The results showed that respondents of this study were mostly single and married with 56.3 and 30 percent respectively. Only 7.5 percent were divorced.
The respondents were mostly employees and students with 40 percent each. Then responses from retired people; followed by Homemakers with 6.3 percent. Least responses came from interns with only 1.2 percent. The higher portion of the respondents indicated that they own an electronic banking account with 81.3 percent of the total responses and 76 percent of them total responses showed that electronic banking indicated that it is easy to use the electronic banking services.
When it comes to transferring money; respondents indicated that they feel secure transferring money from an account to another with 75 percent while the rest indicated that they do not feel safe transferring money from account to another with 25 percent. Respondents also demonstrated their feeling of security when it comes to entering their password to conduct online transactions with 66.3 percent.
The respondents were asked if they came across a time where their money was stolen when conducting an online transaction; 76.3 percent of them voted “no” that they have not experienced such an issue. While 23.8 percent indicated that they experienced money stolen when conducting a transaction online. Also the respondents responded that they are using the banking online services on a monthly basis with 45 percent. While 33.8 percent indicated that they use it weekly, and 13.8 percent indicated that they use the online services of banks only twice.
The responses indicated that the main two disadvantages are the lack of assistance and limited services while conducting online banking services both with 30 percent. However, 25 percent of the respondents indicated that there are no disadvantages of online service offer by the banks.
When it comes to why they use the online services of banks, most of the respondents indicated that they use it to pay their bills with 66.3 percent. Changing personnel information was voted to be the second reason of why they use the online services of banks with 27.5 percent. While transferring money was the third factor to why they use banking online services with 26.3 percent.
The last section of the results of this study where respondents were asked to evaluate the effectiveness of online banking services and whether they prefer it on tranditional branches visits; the respondents strongly agreed that electronic banking saves time and effort with 43.1 percent and 23.8 percent agreed on this statement. Only 7.5 percent strongly disagreed with the statement. On the other hand, the respondents strongly agreed with 32.5 percent that they prefer online banking, 22.5 percent of the total responses indicated that they are neutral. Least responses came from people who strongly disagreed with 4.5 percent.
This section of the report aims to discuss the important findings of the report.
The study revealed that people in Bahrain use the online banking now and has emerged to be significant in their life in terms of services to be conduct online rather than going to a branch. The emergence of online banking sector is highly important for everybody at the moment as the online banking services are fast and reliable; it allows individuals to access and conduct a lot of services without having to go to traditional bank branch.
The results of this study also found that customers in Bahrain are not afraid of using the e-banking services and not consider it risky. In contrast they are very confident using it and would feel secure to conduct any money transferring transactions. Also secure to put type their passwords in their browser and the banks’ website to access it features without having a thought of fraud. The development in banks authentication and security have made it easier for individuals to trust and rely on the e-banking service. Moreover, banks understand that one fraud at their system would results in a heavy loss on more than aspect; one is emotional aspect of the customer and second is the loss of any potential customers. Therefore, banks would always adopt the latest security schemes and services to install at their website to assure their customers reliable services.
The services that are conducted through the online banking systems are a lot at the moment. In this study respondents demonstrated that they mostly they pay their bills from the online banking services. As more and more relationships among B2B or banks with companies such as telecommunication companies in Bahrain, many banks allow their customers to pay their mobile bill through their online portals. For example, BBK allows their customers to pay their credit card bill, EWA bill, telecommunication company’s bills and other type of expenses that can be paid through BBK’s online banking services.
In addition, customers demonstrated few disadvantages that are along with the online banking services. One of the top voted disadvantages is the lack of assistance while using the online banking services. It is known that online banking services does not offer live support or live chat for the customers; in whom it results in a difficulty for the users to conduct the service they wish to accomplish online. Therefore, this might hinders customers to access the online banking services because of the lack of assistance. However, this is not an indicator of a bad service; also many responses came to indicate that there are no disadvantages along with the online services.
The study aims to find out how people perceive the online banking transaction and would they feel safe about it or not. The study designed a questionnaire in which it was shared and disseminated on random people all over Bahrain by using social media platforms. The study gathered a reasonable amount of responses and analyzed the findings based on them.
The results showed that majority of banking accounts holders are using the online features of their bank and that online banking transactions are well known among the Bahrainis. The study revealed that people nowadays trust the e-banking transaction and would therefore depend on it for their fast and easy to use. Also security is an issue, but from the results it was found that people already conducting it and feeling safe with using online platforms of banks to transfer their money.
The online transactions have never been easier at this current technological revolution. The customers will always choose the bank that has online services in which they can rely on. However the study revealed that one of the disadvantages of ebanking is that it lacks assistance to which customers are not sure how to conduct the service they would love to do. But, it is still in a debate as customers would have different needs that might not always be attainable, feasible, or realistic in nature of the online services offered by the banks.
Respondents revealed that they have never come across any theft that happened to them when conducting online transactions which shows the feasibility and effectiveness of using such transaction nowadays.
In overall, the research concluded that the banking is widely adopted by the majority of the bank accounts holders and using the e-banking is quite appealing for them. Online banking is also safe as majority of the respondents indicated.
The study recommends the following;
Banks shall impose more assistance in their online banking website in order for the customer to utilize the best out of their services.
It is recommended for the banks to create a blog or a section in their website where they post videos about how to use their online banking feature and how it would benefit their customers.
It is also recommended for banks to conduct seminars and visit universities to showcase their online services and assure their customers and potential customers that security is their most important feature of e-banking.
The study was limited by time frame that limited the number of the sample size acquired through the questionnaire. Another limitation was that the study only conducted and takes into consideration the consumers point of view. Therefore it is recommended for future studies to conduct an interview with few banks representatives to discuss their services and security matters.
Conklin, A., Dietrich, G., ; Walz, D. (2004, January). Password-based authentication: a system perspective. In System Sciences, 2004. Proceedings of the 37th Annual Hawaii International Conference on (pp. 10-pp). IEEE.Rice, P. (2011). Civil liability theories for insufficient security authentication in online banking. DePaul Bus. ; Comm. LJ, 10, 439.Security Procedures in Business Online Banking. (2018). Retrieved from https://www.umpquabank.com/globalassets/media/documents/umpqua_bank_business_online_banking_security_procedures.pdfKanniainen, L. (2010). Alternatives for banks to offer secure mobile payments. International Journal of Bank Marketing, 28(5), 433-444.
Hoffmann, A. O., ; Birnbrich, C. (2012). The impact of fraud prevention on bank-customer relationships: An empirical investigation in retail banking. International journal of bank marketing, 30(5), 390-407.
Sullivan, R. J. (2010). The changing nature of US card payment fraud: industry and public policy options. Economic Review-Federal Reserve Bank of Kansas City, 95(2), 101.Gates, T., ; Jacob, K. (2009). Payments Fraud: Perception Versus Reality—A conference summary. Economic Perspectives, 33(1), 7-15.
Douglass, D. B. (2009). An examination of the fraud liability shift in consumer card-based payment systems.Krummeck, S. (2000). The role of ethics in fraud prevention: a practitioner’s perspective. Business Ethics: A European Review, 9(4), 268-272.
Varela-Neira, C., Vázquez-Casielles, R., & Iglesias, V. (2010). Lack of preferential treatment: effects on dissatisfaction after a service failure. Journal of Service Management, 21(1), 45-68.
Gruber, T. (2011). I want to believe they really care: How complaining customers want to be treated by frontline employees. Journal of Service Management, 22(1), 85-110.
Sanchez Sanchez, C. R., & Jean-Baptiste, G. (2010). Adoption of Internet banking: evidence from France.
Wu, H. Y., Lin, C. C., Li, O., & Lin, H. H. (2010). A study of bank customers’ perceived usefulness of adopting online banking.
Dospinescu, O., ; Popescul, D. (2005). The Adoption of Electronic Banking Services in Developing Countries-The Romanian Case.
Figure 1 – Age and Gender of Respondents
Figure 2 Educational level and Marital Status of respondents
Figure 3 – Respondents status and If they have e-banking account
Figure 4 – Ease and Safety of using the banking online services
Figure 5 – Perception of respondents toward money stolen and security of e-banking
Figure 6 – How customers are using the e-banking services
Figure 7 – How beneficial the e-banking as perceived by respondents in terms of saving time and effort
Figure 8 – Respondents preference of using e-banking or visiting a branch
Figure 9 – Disadvantages of online banking services
What is your name? (Optional)
What is your gender
How old are you?
18 to 24 years
25 to 30 years
35 to 44 years
45 to 54 years
What is your educational level?
What is your material status?
Are you currently:
Did you open an electronic bank account recently?
How many time did you use your account?
Once a week
Twice a week
Is it easy to use electronic banking?
Do you feel secure when use electronic banking transactions?
Do you feel secure when you enter your password to do online transaction?
Do you deceived in transaction and your money stolen?
What is the online service that you do?
Change personal information
Transfer money from one account to another
What are for you the two main disadvantages of online banking?
Overall difficulty of using online banking system
Lack of assistance
Impersonality of the service
Electronic account save time and effort more than visit the branch to make the transaction:
Do you prefer to use account banking?