The objective of this study is to measure the e-service quality of internet banking and the relationship with customer satisfaction in India. This study aims to explore the critical factors of e-service quality of internet banking in India and to measure the customers’ satisfaction of internet banking on the identified e-service quality dimensions. A survey method was carried out to acquire data from 650 respondents from India. Exploratory and confirmatory factor analysis was used to identify the dimensions of internet banking. Multiple Regression Analysis was used to test the relationship with e-service quality dimensions and customer satisfaction of internet banking. The study uncovered three factors of e-service quality, namely, “Responsiveness,” “Efficiency,” and “Perceived Credibility”. “Responsiveness” found to be the most significant predictor of the e-service quality of internet banking. The study also found that there is a positive relationship exists between e-service quality dimensions and customer satisfaction of internet banking. These findings can be used by banks to improve the service quality of their internet banking service and thereby to satisfy their customers. The findings open up many business opportunities to India as well as other Asian countries. The digital payments industry can concentrate on improving the security of the payment systems, gateways, and payment networks. Advanced technologies can be developed to improve the digital payment systems which offer many business opportunities for creating computers, smartphones, and innovation in internet and security software. The study findings can be used by banks to improve the service quality of internet banking and attract more customers towards using this service. The improvement in service quality comprising of responsiveness, efficiency, and perceived credibility automatically leads to the customer satisfaction of internet banking services, which gives competitive advantages to the banks. This study is an attempt to cover both urban and rural population of India to understand the digital mindset by studying the quality perception of internet banking channel.
Internetworldstats.com (2017) World Internet Users Statistics and 2017 World Population Stats. http://www.internetworldstats.com/stats.htm
Khan, M., Mahapatra, S. and Sreekumar, N. (2009) Service Quality Evaluation in Internet Banking: An Empirical Study in India. International Journal of Indian Culture and Business Management, 2, 30. https://doi.org/10.1504/IJICBM.2009.021596
Daniel, E. (1999) Provision of Electronic Banking in the UK and the Republic of Ireland. International Journal of Bank Marketing, 17, 72-83. https://doi.org/10.1108/02652329910258934
Jayawardhena, C. and Foley, P. (2000) Changes in the Banking Sector—The Case of Internet Banking in the UK. Internet Research, 10, 19-31. https://doi.org/10.1108/10662240010312048
Pikkarainen, K., Pikkarainen, T., Karjaluoto, H. and Pahnila, S. (2006) The Measurement of End-User Computing Satisfaction of Online Banking Services: Empirical Evidence from Finland. International Journal of Bank Marketing, 24, 158-172. https://doi.org/10.1108/02652320610659012
Aladwani, A. (2001) Online Banking: A Field Study of Drivers, Development Challenges, and Expectations. International Journal of Information Management, 21, 213-225. https://doi.org/10.1016/S0268-4012(01)00011-1
Enders, A. and Jelassi, T. (2000) The Converging Business Models of Internet and Bricks-and-Mortar Retailers. European Management Journal, 18, 542-550. https://doi.org/10.1016/S0263-2373(00)00043-8
Chau, P. and Lai, V. (2003) An Empirical Investigation of the Determinants of User Acceptance of Internet Banking. Journal of Organizational Computing and Electronic Commerce, 13, 123-145. https://doi.org/10.1207/S15327744JOCE1302_3
Malhotra, P. and Singh, B. (2007) Determinants of Internet Banking Adoption by Banks in India. Internet Research, 17, 323-339. https://doi.org/10.1108/10662240710758957
Boston Consulting Group and Google India (2016) Digital Payments 2020. Boston Consulting Group and Google India, Mumbai, 1-56.
Zeithaml, V. (2002) Service Excellence in Electronic Channels. Managing Service Quality: An International Journal, 12, 135-139. https://doi.org/10.1108/09604520210429187
Fassnacht, M. and Koese, I. (2006) Quality of Electronic Services. Journal of Service Research, 9, 19-37. https://doi.org/10.1177/1094670506289531
Gummerus, J., Liljander, V., Pura, M. and van Riel, A. (2004) Customer Loyalty to Content-Based Web Sites: The Case of an Online Health-Care Service. Journal of Services Marketing, 18, 175-186. https://doi.org/10.1108/08876040410536486
Van Riel, A., Liljander, V. and Jurriens, P. (2001) Exploring Consumer Evaluations of e-Services: A Portal Site. International Journal of Service Industry Management, 12, 359-377. https://doi.org/10.1108/09564230110405280
Barrutia, J. and Gilsanz, A. (2009) e-Service Quality: Overview and Research Agenda. International Journal of Quality and Service Sciences, 1, 29-50. https://doi.org/10.1108/17566690910945859
Yoo, B. and Donthu, N. (2001) Developing a Scale to Measure the Perceived Quality of an Internet Shopping Site (Sitequal). Quarterly Journal of Electronic Commerce, 31-46.
Barnes, S. and Vidgen, R. (2002) An Integrative Approach to the Assessment of E-Commerce Quality. Journal of Electronic Commerce Research, 3, 114-127.
Loiacono, E., Watson, R. and Goodhue, D. (2002) WebQual: A Measure of Website Quality. Marketing Theory and Applications, 13, 432-438.
Palmer, J. (2002) Web Site Usability, Design, and Performance Metrics. Information Systems Research, 13, 151-167. https://doi.org/10.1287/isre.13.2.151.88
Webb, H. and Webb, L. (2004) SiteQual: An Integrated Measure of Web Site Quality. Journal of Enterprise Information Management, 17, 430-440. https://doi.org/10.1108/17410390410566724
Kim, M., Kim, J. and Lennon, S. (2006) Online Service Attributes Available on Apparel Retail Web Sites: An E-S-QUAL Approach. Managing Service Quality: An International Journal, 16, 51-77. https://doi.org/10.1108/09604520610639964
Lin, H. (2007) The Impact of Website Quality Dimensions on Customer Satisfaction in the B2C E-Commerce Context. Total Quality Management & Business Excellence, 18, 363-378. https://doi.org/10.1080/14783360701231302
Parasuraman, A., Zeithaml, V. and Malhotra, A. (2005) E-S-QUAL. Journal of Service Research, 7, 213-233. https://doi.org/10.1177/1094670504271156
Jayawardhena, C. (2004) Measurement of Service Quality in Internet Banking: The Development of an Instrument. Journal of Marketing Management, 20, 185-207. https://doi.org/10.1362/026725704773041177
Han, S. and Baek, S. (2004) Antecedents and Consequences of Service Quality in Online Banking: An Application of the SERVQUAL Instrument. Advances in Consumer Research, 31, 208-214.
Punyani, G., Dash, G. and Sharma, S. (2015) An Assessment of Customers’ Service Quality Perception through Webqual Scale: A Study on Online Banking Services. Researchers World, 6, 106.
Siu, N. and Mou, J. (2005) Measuring Service Quality in Internet Banking. Journal of International Consumer Marketing, 17, 99-116. https://doi.org/10.1300/J046v17n04_06
Zavareh, F., Ariff, M., Jusoh, A., Zakuan, N., Bahari, A. and Ashourian, M. (2012) E-Service Quality Dimensions and Their Effects on e-Customer Satisfaction in Internet Banking Services. Procedia—Social and Behavioral Sciences, 40, 441-445. https://doi.org/10.1016/j.sbspro.2012.03.213
Jun, M. and Cai, S. (2001) The Key Determinants of Internet Banking Service Quality: A Content Analysis. International Journal of Bank Marketing, 19, 276-291. https://doi.org/10.1108/02652320110409825
Rod, M., Ashill, N., Shao, J. and Carruthers, J. (2009) An Examination of the Relationship between Service Quality Dimensions, Overall Internet Banking Service Quality and Customer Satisfaction. Marketing Intelligence & Planning, 27, 103-126. https://doi.org/10.1108/02634500910928344
Yang, Z. and Jun, M. (2002) Consumer Perception of E-Service Quality: From Internet Purchaser and Non-Purchaser Perspectives. Journal of Business Strategies, 25, 60-84.
Ibrahim, E., Joseph, M. and Ibeh, K. (2006) Customers’ Perception of Electronic Service Delivery in the UK Retail Banking Sector. International Journal of Bank Marketing, 24, 475-493. https://doi.org/10.1108/02652320610712094
Santouridis, I., Trivellas, P. and Reklitis, P. (2009) Internet Service Quality and Customer Satisfaction: Examining Internet Banking in Greece. Total Quality Management & Business Excellence, 20, 223-239. https://doi.org/10.1080/14783360802623084
White, H. and Nteli, F. (2004) Internet Banking in the UK: Why Are There Not More Customers? Journal of Financial Services Marketing, 9, 49-56. https://doi.org/10.1057/palgrave.fsm.4770140
Sohail, S. and Shaikh, N. (2008) Internet Banking and Quality of Service. Online Information Review, 32, 58-72. https://doi.org/10.1108/14684520810865985
Bauer, H., Hammerschmidt, M. and Falk, T. (2005) Measuring the Quality of E-Banking Portals. International Journal of Bank Marketing, 23, 153-175. https://doi.org/10.1108/02652320510584395
Sohn, C. and Tadisina, S. (2008) Development of E-Service Quality Measure for Internet-Based Financial Institutions. Total Quality Management & Business Excellence, 19, 903-918. https://doi.org/10.1080/14783360802224412
Al-Hawari, M., Hartley, N. and Ward, T. (2005) Measuring Banks’ Automated Service Quality: A Confirmatory Factor Analysis Approach. Marketing Bulletin, 16, 1-19.
Ho, C. and Lin, W. (2010) Measuring the Service Quality of Internet Banking: Scale Development and Validation. European Business Review, 22, 5-24. https://doi.org/10.1108/09555341011008981
Al-Tarawneh, K. (2012) Measuring E-Service Quality from the Customers’ Perspective: An Empirical Study on Banking Services. International Research Journal of Finance and Economics, 91, 123-137.
Herington, C. and Weaven, S. (2009) E-Retailing by Banks: E-Service Quality and Its Importance to Customer Satisfaction. European Journal of Marketing, 43, 1220-1231. https://doi.org/10.1108/03090560910976456
Oliver, R. (1996) Satisfaction: A Behavioral Perspective on the Consumer. McGraw-Hill Companies, New York.
Anderson, R. and Srinivasan, S. (2003) E-Satisfaction and E-Loyalty: A Contingency Framework. Psychology and Marketing, 20, 123-138. https://doi.org/10.1002/mar.10063
DeLone, W. and McLean, E. (2003) The DeLone and McLean Model of Information Systems Success: A Ten-Year Update. Journal of Management Information Systems, 19, 9-30. https://doi.org/10.1080/07421222.2003.11045748
Cronin, J. and Taylor, S. (1992) Measuring Service Quality: A Reexamination and Extension. Journal of Marketing, 56, 55. https://doi.org/10.1177/002224299205600304
Collier, J. and Bienstock, C. (2006) Measuring Service Quality in E-Retailing. Journal of Service Research, 8, 260-275. https://doi.org/10.1177/1094670505278867
Cristobal, E., Flavián, C. and Guinalíu, M. (2007) Perceived E-Service Quality (PeSQ). Managing Service Quality: An International Journal, 17, 317-340. https://doi.org/10.1108/09604520710744326
Carlson, J. and O’Cass, A. (2010) Exploring the Relationships between E-Service Quality, Satisfaction, Attitudes and Behaviours in Content-Driven E-Service Web Sites. Journal of Services Marketing, 24, 112-127. https://doi.org/10.1108/08876041011031091
Saunders, S. and Petzer, D. (2010) The Interrelationship between Service Quality, Satisfaction and Behavioural Intention by Customer Stage in the Service Delivery Process. Management Dynamics, 19, 25-34.
Parasuraman, A., Zeithaml, V. and Berry, L. (1988) SERVQUAL: A Multiple-Item Scale for Measuring Consumer Perceptions of Service Quality. Journal of Retailing, 12-40.
Yang, Z., Jun, M. and Peterson, R.T. (2004) Measuring Customer Perceived Online Service Quality: Scale Development and Managerial Implications. International Journal of Operations & Production Management, 24, 1149-1174. https://doi.org/10.1108/01443570410563278
Krosnick, J. and Presser, S. (2010) Question and Questionnaire Design. Handbook of Survey Research, 2, 263-314.
Hair, J., Black, W., Babin, B. and Anderson, R. (2006) Multivariate Data Analysis. 5th Edition, Pearson Education Limited, Harlow.
Nunnally, J. and Bernstein, I. (1978) Psychometric Theory. Tata McGraw-Hill Ed., New Delhi.
Hinkin, T. (1998) A Brief Tutorial on the Development of Measures for Use in Survey Questionnaires. Organizational Research Methods, 1, 104-121. https://doi.org/10.1177/109442819800100106
Podsakoff, P.M., MacKenzie, S.B., Lee, J.Y. and Podsakoff, N.P. (2003) Common Method Biases in Behavioral Research: A Critical Review of the Literature and Recommended Remedies. Journal of Applied Psychology, 88, 879. https://doi.org/10.1037/0021-9010.88.5.879
Laforet, S. and Li, X. (2005) Consumers’ Attitudes towards Online and Mobile Banking in China. International Journal of Bank Marketing, 23, 362-380. https://doi.org/10.1108/02652320510629250
Laukkanen, T. and Pasanen, M. (2008) Mobile Banking Innovators and Early Adopters: How They Differ from Other Online Users? Journal of Financial Services Marketing, 13, 86-94. https://doi.org/10.1057/palgrave.fsm.4760077
Ainin, S., NoorIsmawati, J. and Mohezar, S. (2007) An Overview of Mobile Banking Adoption among the Urban Community. International Journal of Mobile Communications, 5, 157-168. https://doi.org/10.1504/IJMC.2007.011814
Field, A. (2009) Discovering Statistics Using SPSS. 3rd Edition, Sage Publications, London.
Hu, L. and Bentler, P. (1999) Cutoff Criteria for Fit Indexes in Covariance Structure Analysis: Conventional Criteria versus New Alternatives. Structural Equation Modeling: A Multidisciplinary Journal, 6, 1-55. https://doi.org/10.1080/10705519909540118
Hooper, D., Coughlan, J. and Mullen, M. (2008) Structural Equation Modeling: Guidelines for Determining Model Fit. The Electronic Journal of Business Research Methods, 6, 53-60.
Byrne, B. (1998) Structural Equation Modeling with LISREL, PRELIS, and SIMPLIS: Basic Concepts, Applications, and Programming.
Fornell, C. and Larcker, D. (1981) Evaluating Structural Equation Models with Unobservable Variables and Measurement Error. Journal of Marketing Research, 18, 39. https://doi.org/10.1177/002224378101800313
Kaura, V., Durga Prasad, C.S. and Sharma, S. (2015) Service Quality, Service Convenience, Price and Fairness, Customer Loyalty, and the Mediating Role of Customer Satisfaction. International Journal of Bank Marketing, 33, 404-422. https://doi.org/10.1108/IJBM-04-2014-0048