Improving Service Quality in Tropical Bank Through Electronic Banking

IMPROVING SERVICE QUALITY IN TROPICAL BANK
THROUGH ELECTRONIC BANKING
JIBRIL ABDI MOHAMUD
2013/HD10/2892X
A RESEARCH REPORT SUBMITTED TO MAKERERE UNIVERSITY IN
PARTIAL FULFILLMENT OF THE REQUIREMENTS FOR THE
AWARD OF A MASTERS DEGREE OF BANKING AND
INVESTMENT OF MAKERERE UNIVERSITY
PLAN B
SEPTEMBER, 2015
1
Declaration
I, Jibril Abdi Mohamud declare that this research report is my own original work, and it
has never been presented to any University or Institution for the award of any academic
qualification.
SIGN: .
Jibril Abdi Mohamud
2013/HD10/2892X
i
Approval
This is to certify that this research report has been submitted in partial fulfillment of the
requirements for the award of Masters Degree in Banking and investment of Makerere
University with my approval as university supervisors.
Signature. Date .
Dr. Ngoma Muhammed
Signature. Date .
Dr. Vincent Bagire
ii
Dedication
This piece of work is dedicated to my beloved Mom Nura Jama and my Sister Maryam
Abdi for love, sacrifice, guidance patience and all the services that inspired my academic
endeavors
iii
Acknowledgment
The production of this work has been a result of many hands. In particular, I wish to
thank my supervisors Dr. Ngoma Muhammed and Dr. Vincent Bagire for their efforts he
put in, to ensure that this work is completed. They read and reviewed my work and ably
directed me with love and encouragement. I am indeed grateful to you.
I would like to deeply thank all my lecturers at Makerere University Business School.
These have adequately guided and equipped me with both theoretical and practical skills.
Thank you so much for your dedicated and inspiring work.
I would also like to acknowledge the contribution of the course participants, from whom I
enjoyed fruitful discussions on challenging topics.
Special thanks go to all respondents that I came into contact during this study. Your
generosity in accepting to participate in the study is acknowledged and highly
appreciated.
I extend my appreciation to all my family and friends for their constant encouragement
both moral and physical. Special thanks, to my sisters Laylo, Rukia, Shukri, Mustaf and
Kowther also special thanks to my Friend Shamsa. To my friends thank you for all the
information, comments and ideas.
Thank you all.
iv
Table of Contents
Declaration ........................................................................................................................... i
Approval ............................................................................................................................. ii
Dedication .......................................................................................................................... iii
Acknowledgment ............................................................................................................... iv
Table of contents ................................................................................................................. v
List of tables ..................................................................................................................... viii
List of figures ..................................................................................................................... ix
Abstract ............................................................................................................................... x
CHAPTER ONE ............................................................................................................... 1
1.1 Background to the study ............................................................................................... 1
1.2 Statement of the Problem .............................................................................................. 3
1.3 Purpose of the study ...................................................................................................... 3
1.4 Objectives of the study.................................................................................................. 3
1.5 Research Questions ....................................................................................................... 4
1.6 Scope of the Study ....................................................................................................... 4
1.6.1 Geographical Scope ................................................................................................... 4
1.6.2 Conceptual Scope....................................................................................................... 4
1.7 Significance of the study............................................................................................... 4
CHAPTER TWO .............................................................................................................. 6
LITERATURE REVIEW ................................................................................................ 6
2.1 Introduction ................................................................................................................... 6
2.2 The concept of service quality ...................................................................................... 6
2.3 Determinants of Service Quality................................................................................... 6
Customer perception of quality......................................................................................... 10
2.4 Utilization and maintenance of electronic banking .................................................... 10
2.5 Challenges of electronic banking adoption Practices in Organizations ...................... 11
2.6 Strategies to improve electronic banking adoption practices in Organizations .......... 14
CHAPTER THREE ........................................................................................................ 18
METHODOLOGY ......................................................................................................... 18
3.1 Introduction ................................................................................................................. 18
v
3.2 Research Design.......................................................................................................... 18
3.3 Target Population ........................................................................................................ 18
3.4 Sample Size and sampling procedure ......................................................................... 18
3.5 Sampling Methods ...................................................................................................... 19
3.6 Measurement of Variables .......................................................................................... 20
3.7 Sources of Data ........................................................................................................... 20
3.7.1 Primary data ............................................................................................................. 20
3.7.2 Data Collection Method ........................................................................................... 20
3.8 Data Collection Procedure .......................................................................................... 20
3.9 Validity and Reliability Tests ..................................................................................... 21
Table 2: Validity and Reliability results ........................................................................... 21
3.10 Data Analysis ............................................................................................................ 21
3.11 Ethical Consideration ................................................................................................ 22
3.12 Study Limitations ...................................................................................................... 44
CHAPTER FOUR ........................................................................................................... 23
PRESENTATION AND INTERPRETATION OF FINDINGS ................................. 23
4.1 Introduction ................................................................................................................. 23
4.2 Sample Characteristics ................................................................................................ 23
4.2.1 Respondent Category by Gender ............................................................................. 24
4.2.2 Respondent Category by age ................................................................................... 24
4.2.3 Respondent Category by Highest Level of Education ............................................ 25
4.2.4 Respondent Category by Tenure as Employee of the Bank ................................... 26
4.3 Objective One: Service quality gaps in Tropical Bank ............................................... 27
4.4 Objective Two: Challenges in utilization and maintenance of electronic banking .... 29
4.4.1 Whether business efficiency can be improved by electronic banking ..................... 30
4.4.2 Respondents views justifying the use of electronic banking ................................... 31
4.5 Objective Three: Institutional level strategies for utilization and maintenance of
electronic banking in Tropical Bank. ................................................................................ 32
4.7.1: Whether there mechanisms to prevent theft and fraud in the bank ........................ 35
4.7.2 Different mechanisms instituted by the bank to prevent theft and fraud. ................ 35
vi
CHAPTER FIVE ............................................................................................................ 37
DISCUSSION, CONCLUSION AND RECOMMENDATIONS ............................... 37
5.1 Introduction ................................................................................................................. 37
5.2 Discussion of the findings ........................................................................................... 37
5.2.1 Objective One: Service quality gaps in Tropical Bank ............................................ 37
5.2.2. Objective Two: Challenges in utilization and maintenance of electronic banking 40
5.2.3 Objective Three: Institutional level strategies to improve electronic banking
adoption practices in organizations ................................................................................... 41
5.3 Conclusion .................................................................................................................. 42
Recommendations ............................................................................................................. 43
5.4 Areas for further study ................................................................................................ 44
References ......................................................................................................................... 44
QUESTIONNAIRE FOR STAFF MEMBERS OF TROPICAL BANK ......................... 50
QUESTIONNAIRE FOR CUSTOMERS OF TROPICAL BANK ................................. 55
vii
List of tables
Table 3. 1: Sample Size and Selection Pr Respondents views justifying the use of
electronic banking ocedure ............................................................................................... 19
Table 3. 2: Validity and Reliability results ....................................................................... 21
Table 4. 1: Respondent Category by Gender.24
Table 4. 2: Respondent Category by age .......................................................................... 24
Table 4. 3Respondent Category by highest education level ............................................. 25
Table 4. 4: Respondent Category by period spent in the Bank ......................................... 26
Table 4. 5: Service quality gaps in Tropical Bank ............................................................ 27
Table 4. 6: Challenges in the utilization and maintenance of electronic banking ............ 29
Table 4. 7: Respondents views justifying the use of electronic banking ......................... 31
Table 4. 8: Institutional level strategies for utilization and maintenance of electronic
banking .............................................................................................................................. 33
Table 4. 9: whether there mechanisms to prevent theft and fraud. ................................... 35
Table 4. 10: Mechanisms instituted by the bank to prevent theft and fraud .................... 35
viii
List of figures
Figure 1: Showing whether business efficiency can be improved by electronic banking 31
ix
Abstract
The study sought to examine how electronic banking can improve service quality in in the
banking industry. The study adopted a cross sectional survey design. A sample of 195
respondents was drawn from a study population of 344. The stratified random sampling
technique was employed to categorize the respondents and purposive random sampling was
used during the selection of the sample. The SPSS computer package was used to analyze the
data collected by use of a research administered questionnaire.
The research findings showed that respondents expressed disagreement to the fact that
online banking services offered by tropical bank are very reliable and secure and that the
bank had in place skilled and experienced staff that handle electronic banking services
implying that there are some service quality gaps that hinder effective service delivery
however, however there are some electronic banking Practices to which most respondents
agreed and strongly agreed.
From the findings, several challenges were pointed out among which included Perceived
risk, Increase in companys transaction/operations risk, Reputational challenge, Security
challenge, Shortage of qualified Personnel and Quality of Infrastructure. Some of the
strategies put forward to counteract the challenges improvement customer care, top
management involvement and support, staff training and development, monitoring of the
implementation process, capacity planning and upgrade of the security system.
x
CHAPTER ONE
INTRODUCTION
1.0 Introduction
The study aimed at improving service quality in tropical bank through electronic banking
In Kampala Uganda. This chapter covers background, problem statement, and purpose,
objectives of the study, research questions, scope, and significance of the study.
1.1 Background to the study

Vilattes (2007) defines E-banking as a distance banking that not only handles the flow of
information between customers living spaces (e.g. homes, offices) and the physical
facilities of the bank, but also deals with solicitation, sales, distribution and access to
services, all without requiring the customer and the financial institution representative to
be in the same physical place at the same time. Most electronic business specialists agree
that E-banking ensures 24-hours-a-day, seven-days-a-week accessibility, through any
type of advanced information system (Automated Teller Machines, Personal Computers,
Internet, mobile phones etc.) and for all types of financial transactions (Daniel, 2009;
Sathye, 2007).
Gronroos (1984) defines service quality as a judgment resulting from an evaluation
process where customers compare their exceptions with the service they perceive to have
received. In todays fiercely competitive global market, organizations have formulated
various strategies to satisfy customers and the key of it is to increase the service quality
level. Companies that have goods and services that are perceived as being of high quality
typically have greater market share, higher return on investment, and higher asset
1
turnover than firms which have goods and services perceived as being of low quality
(Kim, Lee and Yun, 2004). Earlier studies by Parasuraman et al. (1985) indicate that
Service quality has been identified as a critical success factor for organizations to build
their competitive advantage and increase their competitiveness. Service quality is
particularly essential in the banking services context because it provides high level of
customer satisfaction and hence it becomes a key to competitive advantage (Almossawi
2011).
Tropical Bank Uganda limited is Uganda-based commercial bank. It offers banking and
other financial services and products to individual customers, small and medium
enterprises, as well as corporate organizations. The Banks portfolio includes transaction
accounts, saving and investment accounts, foreign exchange, executive banking. The
bank also offers investment and wealth solutions. As of December 2012, Tropical Bank
was a small-sized financial services provider in Uganda with total bank assets valued at
about US$84 million (Tropical Bank Audited Annual Financial Statement 2014). In order
to improve on the quality of services provided, Tropical bank in 2000 integrated
electronic banking in its operations to be able to cope up with the global trends of
modernization but since the adoption of electronic banking, the bank has faced a number
of challenges including delay in the delivery of transaction alert messages, outage of
service, breakdown of automatic teller machines (Sheba & Mukasa 2013). In addition,
lack of proper use and maintenance of the system has enabled some of the staff member
to compromise the security system resulting in theft and fraud. Even then, some
customers have had their accounts debited to loss of the bank and at times credited to the
loss of the customer (Tropical Bank Trading manual, 2014) therefore there is a need for
2
tropical bank to develop strategies that will help to improve electronic banking practices
which will consequently increase on the level of service quality hence customer loyalty
and satisfaction.
1.2 Statement of the Problem

Tropical bank in 2000 integrated electronic banking in its operations to be able to cope up
with the global trends of modernization but since then, the bank has faced a number of
challenges including delay in the delivery of transaction alert messages, outage of
service, breakdown of automatic teller machines (ATMs). This has caused a lot of
dissatisfaction among customers leading to increased customer defections (Bank of
Uganda, 2003 & Nabatanzi, 2009). This is a concern to management and it could be
attributed to various factors including the new electronic banking system. This study
therefore sought to critically examine how proper utilization and maintenance of
electronic banking would translate into improved service quality.
1.3 Purpose of the study

The study sought to examine how electronic banking can improve service quality in
Tropical Bank.
1.4 Objectives of the study

i. To examine service quality gap in Tropical Bank.
ii. To examine the challenges in utilization and maintenance of electronic banking in
Tropical Bank.
iii. To propose institutional level of suggestions for utilization and maintenance of
electronic banking in Tropical Bank.
3
1.5 Research Questions
i. What are the service quality gaps in Tropical Bank?
ii. What are the challenges faced in utilization and maintenance of electronic
banking in Tropical Bank?
iii. What are the institutional level of suggestions for utilization and maintenance of
electronic banking in Tropical Bank?
1.6 Scope of the Study
1.6.1 Geographical Scope

The study was carried out in Tropical bank main branch which is located in Kampala city
along Kampala road opposite Cham towers.
1.6.2 Conceptual Scope

The study was conducted within the framework of examining the electronic banking
required to improve service quality, assessing the challenges of adopting and maintaining
electronic banking and to propose institutional level strategies for maintenance and
effective utilization of electronic banking to improve service quality in Tropical Bank
1.7 Significance of the study

i. The study would enable the banks executives and indeed the policy makers of the
banks and financial institutions to be aware of electronic banking as a product of
electronic commerce with of making strategic decisions.
ii. The research is equally significant because it will provide answer to factors
militating against the implementation of electronic banking in tropical bank
Uganda limited.
4
iii. It is the researchers intention that when this work is completely carried out, it
will contribute immensely to the existing literature on the general application of e-
banking services in modern day business.
5
CHAPTER TWO
LITERATURE REVIEW
2.1 Introduction
This section reviews the related literature on the study variables as laid down by some
scholars according to the research objectives. It looks at the concept of service quality,
utilization and maintenance of electronic banking, associated challenges and the likely
strategies to improve the use of electronic banking in financial institutions.
2.2 The concept of service quality

The construct of service quality is defined as the difference between expected service and
perceived service (Parasuraman, et al 1985). Perceived service quality is the consumers
judgment about the overall excellence or superiority of a service. The fact that this
construct involves perception means that the above mentioned judgment of the consumer
may differ among individuals experiencing the same situation.
2.3 Determinants of Service Quality

Perasuraman et al (1985) identified the following determinants; reliability,
responsiveness, accessibility, competence, credibility, courtesy, communication, security,
the other determinants include customer perception, consistence of service delivery,
human elements of service quality, tangibles of service.
Responsiveness
Is the willingness to provide help and prompt service to customer (Parasuraman et al,
1999). Responsiveness concerns the willingness or readiness of employees to provide a
service in such a away as; mailing a transaction slip immediately, speed on mortgage
conformation, updating accounts promptly (Francis, 1996). Responsiveness has been
6
shown to an important factor Aukiran (1994), suggest that efforts to increase speed of
processing information and a customer is likely to a positive effect on customer
satisfaction in retail banking. Balunywa, (1995) emphasizes that when a customer has a
need, meet it, be easy accessible available to customer.
Reliability/Consistence of service delivery
Referred to the processes, procedures and systems that would make service delivery a
seamless experience (Sarashchandar et al, 2002) It highlighted whether the service
delivery process wads standardized, streamlined and simplified, so customers could
receive the service without any problem. The structured aspects of service delivery
processes have not ever been adequately studied (Sarashchandar et al, 2002). In literature
there were few marketing scholars who have tried to focus on the importance of the
structural content of service delivery in service quality evaluation. This structural content
of the service delivery process is considered important in service quality evaluation
(Dauaher and Mattson, 1998).
Tangibles of services
They are one of few dimensions that have been consistently used by different researchers
(Bahia and Nantel, 2000). However tangibles refer to physical facets of service facility
equipment, machinery signage, communication material (Parasuraman et al, 1985). It
included the physical evidence of service except the personal appearance of staff which
was included in human element dimension, employees and customers are usually
influenced by the tangible facets of service in physiological, psychological, emotional
and cognitive ways. The intangible aspects of the staff customer interface have a
considerable influence both negative and positive in the service quality (Johnston, 1995).
7
Tangibles are associated with the impact on the customers inferences about what service
should be like and therefore will influence the evaluation of service quality. Customers
perception of tangibles was generally considered important in the case of the banks.
Competence
This was defined by Francis (1996) as the possession of the required skill and knowledge
performs a service. It involves research capacity, knowledge and skills of operational
support staff. Competence is the skill, expertise and professionalism with which the
services are executed. According to Robert (1997), competence includes the carrying out
of correct procedures, correct execution of customer instruction, degree of product and
service knowledge exhibited by contact staff, rendering of sound advice and the general
ability to do a good job.
Communication
Robert (1997) described communication as the ability a service to communicate with a
customer in the away he/ she will understand. It includes the clarity, completeness, and
accuracy of both verbal and written information to customer and the ability to listen and
understand the customer. According to Ntayi, (1999), Communication means keeping
customer informed in the language they can understand and listen to them. It may mean
the company going that extra mile to adjust its language for different customers,
availability of inquiries desk, informing of account changes, and clarity of staff answers
and ease of understanding letters are great consideration to effective communication
(Galloway, 1994). In Uganda retail banking, banks like Stanbic bank, Bank of Africa,
Centenary and DFCU installed ATMs with Luganda instruction; they all have front desks
8
for inquiries and issue bank statement at end of the month to update customers about their
monthly transaction.
Credibility
Credibility involves trustworthiness, believability and honesty. Its about having the
customers best interests at heart, contributing to credibility is a company name, reputation
and privacy discussions (Francis 1996). Balunywa (1995) highlights that credibility mean
trust, assurance, integrity and security. Say what you mean and mean what say. This is
more important in retail banking, an instruction that handles the payment system keeps
customers money.
Access
Access is to do with approachability and ease to contact, it may mean the service is easily
accessible by telephone; waiting time to receive service is not excessive and convenient
hours of operation and convenient location of service facility (Francis 1996). According
to Galloway (1994), getting right person on phone, appearance of branch, ease of getting
to branch, queues at cash machines and staff available to help are issued to look out for.
Robert (1997) considers accessibility to be approachability to the service location,
including the ease of find ones way around the service environment and clarity of route.
In the case of contact staff with means both the staff and customer ratio and amount of
time each staff member has available to spend with each customer for service goods,
accessibility includes both quality and range to product like account types available to the
customer.
9
Customer perception of quality
In Australia, the importance of customers view has grown in since the deregulation of
the banking sector in early 1980s since each customer perception preference has had
increasingly greater impact on the bank success (Saraschandar, 2002). Today customers
are more educated than ever before. They expect more value for money and want a good
service and are willing to pay for it. The level of courtesy and assistance required by the
bank customer as increased dramatically as customers have up graded their service
standards (Yavas et al, 1997).
2.4 Utilization and maintenance of electronic banking

Automated Teller Machines (ATMs)
Rose (2009) cited by Abor, describes ATMs as follows: an ATM combines a computer
terminal, database system and cash vault in one unit, permitting customers to enter the
banks book keeping system with a plastic card containing a PIN or by punching a special
code number into the computer terminal linked to the banks computerized records 24
hours a day. Once access is gained, it offers several retail banking services to customers.
They are mostly located outside of banks, and are also found at airports, malls, and places
far away from the home bank of customers. They were introduced first to function as
cash dispensing machines. However, due to advancements in technology, ATMs are able
to provide a wide range of services, such as making deposits, funds transfer between two
or more accounts and bill payments. Banks tend to utilize this electronic banking device,
as all others for competitive advantage.
The combined services of both the automated and human tellers imply more productivity
for the bank during banking hours. Also, as it saves customers time in service delivery as
10
alternative to queuing in banking halls, customers can invest such time saved into other
productive activities. ATMs are a cost-efficient way of yielding higher productivity as
they achieve higher productivity per period of time than human tellers (an average of
about 6,400 transactions per month for ATMs compared to 4,300 for human tellers (Rose,
2009). Furthermore, as the ATMs continue when human tellers stop, there is continual
productivity for the banks even after banking hours.
Telephone Banking
Telephone Banking (Telebanking) can be considered as a form of remote or virtual
banking, which is essentially the delivery of branch financial services via
telecommunication devices where the bank customers can perform retail banking
transactions by dialing a touch-tone telephone or mobile communication unit, which is
connected to an automated system of the bank by utilizing Automated Voice Response
(AVR) technology (Balachandher et al, 2011). According to Leow (2009), telebanking
has numerous benefits for both customers and banks. As far as the customers are
concerned, it provides increased convenience, expanded access and significant time
saving. On the other hand, from the banks perspective, the costs of delivering telephone-
based services are substantially lower than those of branch based services.
2.5 Challenges of electronic banking adoption Practices in Organizations

Perceived risk
Several recent studies (Liao and Cheung, 2001, Park et al. 2004 and Ruyter et al. 2001)
have deemed consumer risk perceptions to be a primary obstacle to the future growth of
online commerce and e-services. Perceived risk increase with uncertainty and/or the
magnitude of associated negative consequence (Hsi-Peng et al, 2005). The degrees of risk
11
that consumers perceived and their own tolerance of risk tacking are factors that
influence their purchase strategies. It should be stressed that consumers are influenced by
risks that they perceive whether or not such risk.
Increase in companys transaction/operations risk
Earl (2000) commented that banking activities has the likelihood of increasing the
complexity of the institutions activities and the quantity of its transaction/operations risk,
especially if the institution is offering innovative services that have not been
standardized. Since customers expect E-banking services to be available 24 hours a day,
7 days a week, financial institutions should ensure their E-banking infrastructures contain
sufficient capacity and redundancy to ensure reliable service availability. Even
institutions that do not consider E-banking a critical financial service due to the
availability of alternate processing channels, should carefully consider customer
expectations and the potential impact of service disruptions on customer satisfaction and
loyalty.
Reputational challenge
Breaches of security and disruptions to the system's availability can damage a bank's
reputation. The more a bank relies on electronic delivery channels, the greater the
potential for reputational risks. If one electronic bank encounters problems that cause
customers to lose confidence in electronic delivery channels as a whole or to view bank
failures as system wide supervisory deficiencies, these problems can potentially affect
other providers of electronic banking services. In many countries where electronic
banking is becoming the trend, bank supervisors have put in place internal guidance notes
for examiners, and many have released risk-management guidelines for banks.
12
Security challenge
Internet banks collect and keep some very important personal information from each
client. As Internet technology advances, so does the ability of criminals to hack into an
Internet bank and steal important client information, according to financial expert Steve
Ellis, writing on the Computer World website. Internet banks must constantly update
security measures and stay updated on the latest viruses and hacker tools in order to
protect client information.
Shortage of qualified Personnel
Njuru (2007) used descriptive statistics analyzed challenges in implementing electronic
banking strategy by commercial banks in Kenya, it was found out that so can the shortage
of knowledgeable personnel, even if the technology is there. The lack of experience and
knowledgeable staff has been one of the major challenges that hinder the effective use of
electronic banking. It was concluded that in order for banks to enjoy the economies of
scale associated with electronic banking, then it has to introduce training and
developments sessions in order to upgrade the skills of their employees. Earl, (2002)
furthermore identified that while managers typically have a high-level understanding of
their business and 31 operational processes, they often lack employees with the
experience and skills necessary to adopt software technologies and educate customers.
Quality of Infrastructure
Quality of the internet connection is seen to be an essential component of any internet-
based application. Sathye (1999) used internet access as one of the factors affecting the
adoption of Internet Banking. Without a proper internet connection the use of electronic
banking is not possible.
13
2.6 Strategies to improve electronic banking adoption practices in Organizations
Improve customer care
To improve customer service, the provision of information on timely bases prevention of
fraud, and to support new agile business models, banks need to deal with all the
problematic issues associated with these legacy systems. One solution is, of course,
replacement, but often high costs and unacceptable risks make this option unattractive.
Another alternative is to reengineer these systems first and then wrap them with new
technology which can provide functionality as a service to other systems and allow
changes to the core systems without the need to redevelop all systems. Later systems can
be divided and replaced/redeveloped on a piecemeal basis (Kendler, 2005). This
approach, if executed well, can help link a banks infrastructure with modern business
process driven applications.
Top management involvement and support
Previous research has shown that positive involvement of top management acts as
support to a new system (Chattopadhyay, 2001). This is largely because senior managers
must manage the necessary culture change required (Jackson, 2001). Without a consistent
message and senior level champions for the initiative the company might fail to achieve
the buy-in of other managers within the organization. Management should ensure that
they have the time and resource to properly implement improvement efforts and be
realistic about the time and wider impacts of strategy implementation demands placed on
their employees. A key person should champion the strategy change and facilitate it. He
must have excellent knowledge of the new strategy and have the necessary political
support to implement it.
14
Staff training and development
Appropriate training has an important part to play in enhancing individuals' preparedness
and abilities to strategy implementation and change (Hansson et al., 2003). Training
should bolster efforts at communication by helping individuals to develop their
contextual understanding in order to convey what is going on, and why. Courses that
explain the concept of the new strategy and how to adopt the new strategy to the work
will be needed. Furthermore, training should be employed to enhance the new skills
required of people to adopt the new strategy. If the interval between training and practice
is too long, people tended to forget what they had learnt. Additional training may
therefore be required (Hansson et al., 2003).Training also increases the employee
commitment within the management of strategy change process. This is crucial, both
regarding consolidating present change, and the likely future success of any ongoing
change programmes (Bennet and Durkin, 2000). The potential of benefiting from
continuous improvement emphasizes the importance of gaining employee commitment
and cooperation.
Monitoring of the implementation process
Careful monitoring of the implementation process is crucial to ensuring its sustained
effectiveness. This should include activities such as obtaining measurable outcomes in
order to provide a clear focus for monitoring and following through the process. Essential
elements of this should include control and feedback in the form of both formal and
informal mechanisms that allow the process of implementation to be monitored, the use
of quick feedback such as customer satisfaction, which can encourage employees to
15
continue with the change process. Failure to achieve the espoused objectives should be
investigated and addressed (Okumus, 2003).
Capacity planning
Planning the implementation is very important in strategy implementation as it aims to
clearly identify obstacles to strategy change, as well as the driving forces behind it. This
should include activities, which encourage the participation of all concerned parties (e.g.
front-line staff and management), usually by means of small teams, in goal setting, and
identifying solutions (Lewis et al., 2004). The operational planning process will have a
great deal of impact on existing resources if it is to be implemented effectively. The
procedures of securing and allocating financial resources for the new strategy must
therefore be clear and transparent. When designing training interventions, the learner
must see a connection between the learning task and its potential consequences.
Upgrade security system
Thornton Consulting (2006) and Booz et al. (2007) in their study reveal that security
concern among customers is one of the top-ranking obstacles for non-adoption of Internet
banking by customers therefore banks need to visibly demonstrate concern for security,
reliability, with concrete solutions to improve trustworthy secure e-banking systems, and
specifically protect personal information or security for payment transaction. There is a
need to upgrade the banks security system. To overcome such risk issues, bank
management should take steps to manage and minimize perceived security and risks.
Banks should implement new security policies, improve the internal communication
coordination, evaluate and upgrade their services according to customers expectations,
and develop service recovery programmes. Banks should also increase their ability to
16
control and manage the various risks inherent in Internet banking. Banks can use
encryption, firewall, intrusion detection, and other related security devices to properly
safeguard the Internet banking security systems.
17
CHAPTER THREE
METHODOLOGY
3.1 Introduction
This chapter gives details of the research design that was adopted, the target population,
sampling procedure, data sources, data collection procedures, measurement of variables,
validity and reliability of data, data analysis and the final ethical consideration.
3.2 Research Design

The researcher used a cross sectional research design because it would ably facilitate the
collection of data from the different category of respondents. This helped the researcher
to get the individual responses/opinions of the variables under study.
3.3 Target Population

The study population comprised of 344, 19 of them are from the Head of the Electronic
Banking department, the Head of the Card Centre, the IT Manager, the E-business
Manager, staff from the Electronic Banking and IT departments and 325 Tropical Bank
customers.
3.4 Sample Size and sampling procedure

The sample size was determined using Krejcie & Morgans (1970) table of appropriate
sample size for a given population (Amin 2005).
18
Table 3. 1: Sample Size and Selection Procedure
Category of respondents Study Population Targeted sample size
Head of the Electronic Banking department 1 1
Head of the Card Centre, the IT Manager 1 1
E-business Manager 1 1
Staff from the Electronic Banking and IT 16 15
departments
Electronic banking customers 325 177
Total 344 195
Source: Tropical Bank Annual Management Report, (2015)
3.5 Sampling Methods

Simple random sampling and purposive sampling were the methods used. Simple random
sampling was used because the study intended to select a representative sample without
bias from the accessible population (Oso and Onen, 2005). This ensured that each
member of the target population had an equal and independent chance of being included
in the sample. All employees of Tropical Bank were targeted and randomly selected to
take part in the study.
According to Amin, (2005) purposive sampling is preferred in selecting people holding
positions that allow them to be more knowledgeable with issues going in their areas. In
that respect therefore, the Researcher used purposive sampling for selecting key
informants like top management, senior management, middle management and support
19
staff. Purposive sampling was used because of the specific or particular groups of
respondents that were required to take part in the study.
3.6 Measurement of Variables

Five items of tangibles, reliability, responsiveness, assurance and empathy as developed
by scholars like Parasuraman et al., (1985), Brady and Cronin, (2001) were adapted and
used to measure the study variables.
3.7 Sources of Data

The study was carried out using primary data.
3.7.1 Primary data

Primary data was obtained through the use of research-administered questionnaires to
respondents following systematic and established academic procedures.
3.7.2 Data Collection Method

Self-administered Questionnaire: The researcher used self-administered questionnaires
which were distributed to respondents. Questions used were anchored on a 5-point Likert
Scale ranging from 1=Strongly Disagree to 5=Strongly Agree.
3.8 Data Collection Procedure

The researcher obtained an introductory letter from Graduate Research Centre, Makerere
University and from the Head of Human Resources of Tropical bank to be presented to
the respondents, seeking their permission to participate in the study. The introductory
letter permitted the researcher to carry out research in the organization. Then self-
administered questionnaires were given to the employees of tropical bank
20
3.9 Validity and Reliability Tests
Validity is concerned with the extent to which an instrument measures what one thinks it
is measuring (Oso and Onen, 2005) the instruments was tested for validity to improve the
validity of instruments as questionnaires were examined and assessed by research experts
and the supervisor. The statement or questions which could not portray the meaning were
scraped off and replaced according to their advice.
Cronbach alpha values with a measure of 0.7 and above average was used as the
acceptable value after a pre-testing survey (Kagaari, 2010).
Table 3. 2: Validity and Reliability results
Objective Crombach
Alpha Value
Service Quality Gap .80
Challenges in utilization and maintenance of electronic banking .80
Strategies for utilization and maintenance electronic banking .90
Source: Primary Data
The table above table displays the reliability coefficients for all constructs that were used
in the study. All alpha reliabilities () for all scales were above 0.7 ranging from 0.8 to
0.9 therefore meeting acceptance standards for research.
3.10 Data Analysis

The collected data was cleaned, edited, coded and entered into a computer software
program called Statistical Package for Social Scientists (SPSS Version 16.0) for further
analysis. The collected data was subjected to descriptive analysis using descriptive
statistics such as frequency, percentage, mean and standard deviation.
21
3.11 Ethical Consideration
To bring confidence in the respondent, respondents were assured that information given
will be handled with confidentiality. The respondents names were not required and
questionnaires were filled by the respondents alone and latter collected by the researcher.
The respondents were assured that the research is strictly for academic purpose.
22
CHAPTER FOUR
PRESENTATION AND INTERPRETATION OF FINDINGS
4.1 Introduction
This chapter presents the results of the study and interpretation of findings. The chapter
comprised of four sections. Section one presents the sample characteristics showing,
gender, tenure of service, level of education and age of respondent. The presentation
begins with a description of the sample characteristics. The second section of the chapter
presents statistics that explain the study variables under study using the item means. The
presentation was guided by the following research questions;
i. What are the service quality gaps in Tropical Bank?
ii. What are the challenges faced in utilization and maintenance of electronic
banking in Tropical Bank?
iii. What are the institutional level strategies for utilization and maintenance of
electronic banking in Tropical Bank?
4.2 Sample Characteristics

To present sample characteristics, frequency tabulations were used. These characteristics
included gender, tenure of service, and level of education and age of respondent. The
sample characteristics were presented basing on the responses from the respondents.
23
4.2.1 Respondent Category by Gender
Frequency tabulation was used by the researcher to present the gender distribution
categories of the respondents. Table 4.1 below presented the results:
Table 4. 1: Respondent Category by Gender
Frequency Valid Percent Cumulative Percent
Valid Male 126 64.6 64.6
Female 69 35.4 100.0
Total 195 100.0
According to the results in table 4.1 above, the majority of the respondents were male
accounting for 64.6% whereas, their female counterparts accounted for 35.4%. This is
indication that the male were more responsive compared to the female.
4.2.2 Respondent Category by age

Frequency tabulation was used by the researcher to present the age of respondent
distribution categories of the respondents. Table 4.2 below presented the results:
Table 4.2: Respondent Category by age
Valid 19-30years 109 55.9 55.9
31-40years 45 23.1 79.0
41-50years 29 14.9 93.8
Above 50years 12 6.2 100.0
Total 195 100.0
24
From the results in table 4.5 above, the majority of the respondents belonged to the 19-30
years age group (55.9%), 23.1% belonged to the 31-40 years age group, 14.9% were aged
between 41-50years while 6.2% were aged 50years years and above.
4.2.3 Respondent Category by Highest Level of Education

Frequency tabulation was used by the researcher to present the highest level of
respondent distribution categories of the respondents. Table 4.3 below presented the
results:
Table 4.3 Respondent Category by highest education level
Valid Certificate 19 9.7 9.7
Diploma 104 53.3 63.1
Bachelors 37 19.0 82.1
Masters 18 9.2 91.3
Others 17 8.7 100.0
Total 195 100.0
The results in table 4.3 above show that 9.7% of the respondents were certificate holders,
53.3% were diploma holders, 19% held bachelors degrees, 9.2% possessed masters
degrees and 8.7% had qualifications in other levels. From the results it is clear that over
60% of the respondents either had diplomas or degree which is an indication that the
respondents who comprised of the study were qualified to provide the required responses
for the study.

25
4.2.4 Respondent Category by Tenure as Employee of the Bank
Frequency tabulation was used by the researcher to present the tenure of respondent
distribution as an employee at the bank. Table 4.4 below presented the results:
Table 4. 4: Respondent Category by period spent in the Bank
Valid
Less than 1 year 16 8.2 8.2
1 - 2 years 22 11.3 19.5
3- 4years 129 66.2 85.6
5years & above 28 14.4 100.0
Total 195 100.0
According to the results in table 4.3 above, 8.2% of the respondents revealed that they
hand worked for their organizations for a period of less than 1 year, 11.3% had spent with
their organizations a period of 1-2 years, 66.2% had served for 3-4 years, 14.4% had
worked for their organizations for a period of 5 years and above. From the results, the
majority of the respondents had spent 3-4 years in the bank.
26
4.3 Analysis of Findings
In this section we present analysis of findings according to study objectives.
4.3.1 Service quality gaps in Tropical Bank
The results in the section below were generated so as to examine the service quality gaps.
Item mean tabulation was used to present the results as presented in table 4.5 below.
Table 4.5: Service quality gaps in Tropical Bank
Item Min Max Mean Std. Dev

Online banking services offered by tropical bank 1 5 4.41 1.072
can be easily accessed at any time.
The intangible nature of the electronic banking 1 5 4.33 1.191

reduces bureaucracy and red tape.
Staff at Tropical bank provide care and 1 5 4.11 1.579

undivided attention to e.banking customer
Electronic banking services provide a lot of 1 5 4.03 1.443

convenience to customers.
Tropical bank staff very friendly to their 1 5 3.97 1.680

customers
The team that handles electronic banking at 1 5 3.94 1.676

tropical bank is very credible and experienced
Tropical bank easily respondents to customers 1 5 3.91 1.669
complaints about the nature of online services
Tropical bank has a clear and robust 1 5 3.72 1.778

communication link to address and update
e.banking customers
Online banking services offered by tropical bank 1 5 1.94 1.628

are very reliable and secure.
Tropical bank has in place skilled and 1 5 1.89 1.633

experienced staff that handle electronic banking
services
27
Legend
Mean range Respondents mode Description
4.01-5.00 Strongly agree Very high
3.26 - 4.00 Agree High
2.51 3.25 Undecided Moderate
1.76 - 2.50 Disagree Low
1.00 - 1.75 Strongly disagree Very low
According to the results in table 4.5 above, Online banking services offered by tropical
bank are not reliable and secure (Mean=1.94), Tropical bank easily respondents to
customers complaints about the nature of online services (Mean=3.91), Online banking
services offered by tropical bank can be easily accessed at any time (Mean=4.41),
Tropical bank has in place experienced and dedicated staff that handle electronic banking
services (Mean=3.93), Tropical bank has a clear and robust communication link to
address and update electronic banking customers (Mean=3.72), The team that handles
electronic banking at tropical bank is very credible and experienced (Mean=3.94), The
intangible nature of the electronic banking reduces bureaucracy and red tape
(Mean=4.33), Tropical bank staff very friendly to their customers (Mean=3.97), Staff at
Tropical bank provide care and undivided attention to electronic banking customer
(Mean=4.91) and electronic banking services provide a lot of convenience to customers
(Mean=4.91).
28
4.3.2 Challenges in utilization and maintenance of electronic banking
The results in the section below were generated so as to examine the challenges in
utilization and maintenance of electronic banking. Item mean tabulation was used to
present the results as presented in table 4.6 below.
Table 4. 6: Challenges in the utilization and maintenance of electronic banking
Customer's perception of risk associated with 1 5 4.56 .914
electronic banking hinders its use.
electronic banking is associated with the increase in 1 5 4.39 1.075
the quantity of transaction/operations risk
There is lack of highly qualified and experienced 1 5 4.34 1.040
staff to manage and maintain electronic banking
The Internet stability is unpredictable which affect 1 5 4.18 .906
the electronic banking use.
Perceived risk increase with uncertainty and the 1 5 4.18 1.165
magnitude of associated negative consequence
Breaches of security in electronic banking systems 1 5 3.59 1.413
can damage a bank's reputation
Low levels of awareness about the benefits of 1 5 3.55 1.619
electronic banking limits its use.
Poor customer care can hinder the use of electronic 1 5 3.45 1.378
banking
29
Legend
From the results in table 4.8 above, the results revealed that among the challenges of
electronic banking use and maintenance included perceived risk (Mean=4.56), increase in
companys transaction/operations risk (Mean=4.11), Reputational challenge
(Mean=3.59), lack of highly qualified and experienced staff to manage and maintain
electronic banking (Mean=4.34), Internet stability is unpredictable which affect the
electronic banking use. (Mean=4.18), Low levels of awareness about the benefits of
electronic banking limits its use. (Mean=3.55) and Poor customer care can hinder the use
of electronic banking (mean=3.45). This implies that the existence of gaps in the
utilization and maintenance of electronic banking has greatly affected the quality of
services offered.
4.3.3 Whether business efficiency can be improved by electronic banking

The results in figure 4.1 below were generated so as to examine whether business
efficiency can be improved by electronic banking
30
Figure 1: Showing whether business efficiency can be improved by electronic
banking
No
11%
Yes
89%
4.3.4 Respondents views justifying the use of electronic banking

In this section, respondents were required to give reasons as to why they think that that
business efficiency can be enhanced by electronic banking as seen in table 4.7 below.
Table 4.7: Respondents views justifying the use of electronic banking
Valid Quick and faster 137 70.3 70.3
no time wastage 23 11.8 82.1
Facilitates payment 20 10.3 92.3
Reduces theft 15 7.7 100.0
Total 195 100.0

According to the results in table 4.7 above, 70.3% of the response indicated that
electronic banking is quick and faster, 11.8% associated it with reduction in time
31
wastage, 10.3% linked it with the advantage of facilitation in payment while 7.7%
attributed it to reduction in the levels of risk and theft. From the results, almost one
hundred percent of the respondent associated electronic banking with a lot of benefits and
thus would be instrumental in enhancing business performance and efficiency as one of
the respondents had this to say:
the advent of electronic banking has indeed curtailed a lot of process compared
to days before, today I am able to send money to traders in upcountry locations
and they access their money using their ATM cards without necessarily going to
line up the banks hence wasting a lot of time as time is money
4.5 Institutional level suggestions for utilization and maintenance of electronic

banking in Tropical Bank.
The results in the section below were generated so as to identify institutional level
strategies for utilization and maintenance of electronic banking. Item mean tabulation
was used to present the results as presented in table 4.7 below.
32
Table 4.8: Institutional level of suggestion for utilization and maintenance of
electronic banking

There should be positive involvement of top 1 5 4.30 1.081
management so as to support a new system
Tropical bank should increase its ability to 1 5 4.21 1.145
control and manage the various risks inherent in
Internet banking
Tropical bank should put in place training and 1 5 4.13 1.335
development sessions for its employees.
There should be Careful monitoring of the 1 5 4.06 1.303
implementation the e.banking processes.
Tropical bank should sensitize its customers 1 5 4.04 1.119
about the benefits associated with the use of
e.banking
The bank should allocate sufficient funds to 1 5 3.98 1.218
service, maintain and upgrade the facilities use
in e.banking
There should be an improvement in the level of 1 5 3.85 1.451
customer care service in the bank.
Tropical bank should outsource experienced 1 5 3.58 1.677
staff with expertise to manage electronic
banking.
Tropical bank should provide encryption and 1 5 3.92 1.379
strong authentication to prevent fraud and
identity theft
33
Legend
From the results in table 4.9 above, among the institutional level strategies for
introducing, maintenance and effective utilization of electronic banking included;
Tropical bank should put in place training and development sessions for its employees
(Mean=4.13), There should be an improvement in the level of customer care service in
the bank (Mean=3.85), Tropical bank should outsource experienced staff with expertise
to manage electronic banking (Mean=3.58), There should be positive involvement of top
management so as to support a new system (Mean=4.30), Tropical bank should provide
encryption and strong authentication to prevent fraud and identity theft (Mean=3.92), The
bank should allocate sufficient funds to service, maintain and upgrade the facilities use in
electronic banking (Mean=3.98), There should be Careful monitoring of the
implementation the electronic banking processes (Mean=4.06), Proper planning in the use
and maintenance of electronic banking should be enforced (Mean=4.08), Tropical bank
should increase its ability to control and manage the various risks inherent in Internet
banking (Mean=4.21) and Tropical bank should sensitize its customers about the benefits
associated with the use of electronic banking (Mean=4.04).
34
4.5.1: Whether there are mechanisms to prevent theft and fraud in the bank
The study also wanted to establish whether there are mechanisms instituted by the bank
to prevent theft and fraud as can be seen in table 4.8 below.
Table 4.9: whether there are mechanisms to prevent theft and fraud.

Valid Yes 167 85.6 85.6
No 28 14.4 100.0
Total 195 100.0
Study findings from table 4.8 above indicate that there are mechanisms through which the
bank detects theft and fraud in an effort to prevent unnecessary loses.
4.5.2 Different mechanisms instituted by the bank to prevent theft and fraud.
Respondents were asked to mention some of the ways through which the bank tries to
prevent fraud and theft at the bank, the following responses as in table 4.9 below were
obtained.
Table 4.10: Mechanisms instituted by the bank to prevent theft and fraud

Valid CCTV Camera 123 63.1 63.1
Supervision 22 11.3 74.4
Internal audit 26 13.3 87.7
Documentation 24 12.3 100.0
Total 195 100.0
Study findings from the table and figure above show that 63.1% of the respondents
mentioned CCTV Cameras, 11.3% supervision, 13.3% internal audit mainly to detect and
35
isolate fraud and documentation to provide evidence for the transactions carried out. All
the responses obtained indicate that the bank tries as much as possible to ensure that
neither customers nor bank asset is lost through fraud and theft.
36
CHAPTER FIVE
DISCUSSION, CONCLUSION AND RECOMMENDATIONS
5.1 Introduction
This chapter presents the discussion, conclusions and recommendations arising out of the
study findings and objectives in chapter four and suggests areas for further study. The
study has generated several findings most of which are in line with existing literature and
previous research findings.
5.2 Discussion of the findings

In this section we present discussion of findings according to study objectives.
5.2.1 Service quality gaps in Tropical Bank

Findings from the study indicate that online banking services offered by tropical bank are
not reliable and secure. This implies that online services offered are not dependable and
cannot be relied on by customers hence corresponding with the study findings of Walker
(2002) who noted that the use of internet banking has been rejected or ignored by most
customers especially in developing world because of the perceived worried or problems
associated with technology-based service delivery systems as most lack confidence that it can
be used to addresses challenges that arises.
In a related study, Wungwanitchakorn (2002) indicated that internet banking is still at its
growth stage in African continent as well as developing countries since fewer bank customers
accustomed to the use of electronic channels to manage their financial affairs hence the low
adoption internet banking. Additionally, Wungwanitchakorn (2002) indicated the
dissatisfaction with the electronic or internet banking is because of the high failure rates of
most of the innovative products and services introduced.
37
Study findings further indicated that Tropical bank does not have in place experienced and
dedicated staff that handles electronic banking services. This could also be attributed to
the fact that internet banking being a new innovation, there are few people with the
required skills for maintenance and use of the innovation. This is in line with
Brynjolfsson & Hitt (2000) who noted that populations need new knowledge and new
skills to understand, to feel at ease with, to take advantage of, to benefit from, and to
operate ICT efficiently. The speed of change of ICT means that acquisition of this new
knowledge and skills needed to operate ICT is becoming a never-ending process.
Study findings have indicated that online banking services offered by tropical bank can be
easily accessed by the customer at any time he feels like transacting with the bank. This
is in agreement with the assertions of Parasuraman (1999) who in his study noted for a
service to be beneficial to the user, it should be provided in convenient locations, at
convenient time with little waiting time which can be helpful in meeting customer
expectations hence increasing the rate of use and consumption.
Furthermore, the findings disclosed that the intangible nature of the electronic banking
reduces bureaucracy and red tape which is a characteristic of many service organizations
hence corresponding with the findings of Johnston (1995) who noted that minimal
interface between the customer and the staff reduces time and increases on the level of
efficiency since most of the work is done by the machine like cash withdrawal on ATMs.
Study findings further indicate that electronic banking services provide a lot of
convenience to customers hence in line with the findings of Parasuraman (1993) who
38
noted that customers will always be pleased with a service provider that makes
innovations to provide a service that a client can have access to with minimal effort.
Findings from the study have also indicated that Tropical bank has a clear and robust
communication link to address and update electronic banking customers implying that
bank staff is able to communicate with a customer in the away he/ she will understand
hence corresponding with the study findings of Ntayi, (1999) who noted that
communication involves many aspects like keeping customer informed of the current and
upcoming events in the language they can understand and listen to them.
The findings have also revealed that the team that handles electronic banking at tropical
bank is very credible and experienced implying that they can be trusted, believed in and
are honest in all their dealings with the customer hence corresponding with the study
findings of Balunywa (1995) who highlighted that credibility means trust, assurance,
integrity and security as these are key ingredients to effective service delivery.
It was revealed from the study that that bank has in place experienced and dedicated staff
to handle electronic banking services implying that staff has the required skill and
knowledge performs a service. Robert (1997) in his study noted that competence includes
the carrying out of correct procedures, correct execution of customer instruction, degree
of product and service knowledge exhibited by contact staff, rendering of sound advice
and the general ability to do a good job.
39
5.2.2. Challenges in utilization and maintenance of electronic banking
From the findings, among the challenges in utilization and maintenance of electronic
banking included Perceived risk, Increase in companys transaction/operations risk,
Reputational challenge, Security challenge, Shortage of qualified Personnel and Quality
of Infrastructure. The findings are supported by Liao and Cheung (2001) Park et al. (2004)
and Ruyter et al. (2001) who have deemed consumer risk perceptions to be a primary
obstacle to the future growth of online commerce and e-services. Similarly, Hsi-Peng et
al, (2005) in their study noted that perceived risk increase with uncertainty and/or the
magnitude of associated negative consequence. Earl (2000) commented that banking
activities has the likelihood of increasing the complexity of the institutions activities and
the quantity of its transaction/operations risk, especially if the institution is offering
innovative services that have not been standardized. Since customers expect E-banking
services to be available 24 hours a day, 7 days a week, financial institutions should
ensure their E-banking infrastructures contain sufficient capacity and redundancy to
ensure reliable service availability. Even institutions that do not consider E-banking a
critical financial service due to the availability of alternate processing channels, should
carefully consider customer expectations and the potential impact of service disruptions
on customer satisfaction and loyalty. Njuru (2007) found out that shortage of
knowledgeable personnel even though the technology is there may pose as a challenge to
the effective use of electronic banking. Sathye (1999) noted that without a proper internet
connection the use of electronic banking is not possible. Schware (2003) argues that
Information Resource Management is also a challenge in integrating ICT in organization
and that it is a relatively new professional area in ICT. He further noted that it focuses on
assuring availability and reliability of ICT services and systems while containing the
40
overall costs that would otherwise escalate out of control. Technologically developed
countries face this challenge, and it is even more critical in developing countries.
5.2.3 Institutional level suggestions to improve electronic banking adoption

practices in organizations
According to the findings, among the institutional level strategies for introducing,
maintenance and effective utilization of electronic banking proposed by the respondents
were improvement customer care, top management involvement and support, staff
training and development, monitoring of the implementation process, capacity planning
and upgrade of the security system. The findings are given credence by Kendler (2005)
who suggest to improve customer service, the provision of information on timely basis,
prevention of fraud and to support new agile business models, banks need to deal with all
the problematic issues associated with these legacy systems. Another alternative is to
reengineer these systems first and then wrap them with new technology which can
provide functionality as a service to other systems and allow changes to the core systems
without the need to redevelop all systems. Chattopadhyay (2001) in his study noted that if
online banking utilization and maintenance is to be successful, then top management has
to be directly involved and provide adequate support to the line managers since they are
mostly concerned with the approval process of any project and more especially when
there is need for funds. This is largely because senior managers must manage the
necessary culture change required (Jackson, 2001). Chattopadhyay (2001) went ahead
and noted that management should ensure that they have the time and resource to
properly implement improvement efforts and be realistic about the time and wider
impacts of strategy implementation demands placed on their employees. Hansson et al.
41
(2003) noted that in order an organization to implement change that is effective, then
staff involved has to undergo some training. Appropriate training has an important part to
play in enhancing individuals' preparedness and abilities to strategy implementation and
change. In a related incident, Bennet and Durkin, (2000) in their study indicated that
training is crucial both regarding consolidating present change and the likely future
success of any ongoing change programmes. (Okumus, 2003) noted that careful
monitoring of the implementation process is crucial to ensuring its sustained
effectiveness. He further noted that essential elements of this should include control and
feedback in the form of both formal and informal mechanisms that allow the process of
implementation to be monitored, the use of quick feedback such as customer satisfaction,
which can encourage employees to continue with the change process.
Thornton Consulting (2006) and Booz et al. (2007) in their study reveal that security
concern among customers is one of the top-ranking obstacles for non-adoption of Internet
banking by customers therefore banks need to visibly demonstrate concern for security,
reliability, with concrete solutions to improve trustworthy secure e-banking systems, and
specifically protect personal information or security for payment transaction.
5.3 Conclusion
Findings from the study indicated that there are some service quality gaps for instance
unsecure and reliability of online banking, absence skilled and experienced staff to
service and maintain the system. However, other findings have showed that there is an
effective use and maintenance of electronic banking in the bank like easily responding to
customers complaints about the nature of online services, the friendly nature of customer
42
care service staff and the benefits of convenience that accrue from the use of internet
banking among others.
From the findings several challenges were pointed out among which included Perceived
risk, Increase in companys transaction/operations risk, Reputational challenge, Security
challenge, Shortage of qualified Personnel and Quality of Infrastructure.
Some of the strategies put forward to counteract the challenges were improvement
customer care, top management involvement and support, staff training and development,
monitoring of the implementation process, capacity planning and upgrade of the security
system.
5.4 Recommendations
The aim of this study was to examine how electronic banking can improve service quality
in Tropical Bank and the following recommendations were made:
i) The online banking services offered by tropical bank are not very reliable and
secure therefore the bank need to visibly demonstrate concern for security,
reliability, with concrete solutions to improve trustworthy secure e-banking
systems, and specifically protect personal information or security for payment
transaction.
ii) The Bank should implement new security policies, improve the internal
communication coordination, evaluate and upgrade its services according to
customers expectations and develop service recovery programs.
iii) The bank should also increase its ability to control and manage the various risks
inherent in Internet banking for instance by use of encryption, firewall, intrusion
43
detection, and other related security devices to properly safeguard the Internet
banking security systems.
iv) Tropical bank does not have in place skilled and experienced staff that handles
electronic banking services, it was thus recommended that Banks staff and
officials should be adequately trained in e-banking products and services to be
able to address customers needs and challenges in a timely and faster manner.
v) Based on the findings that access is sometimes limited due to heavy traffic which
at times results into machine breakdown. It was recommended that the bank
should regularly monitor customers access, implement traffic management
systems for internal and external users and coordinate services with internet
service providers.
5.5 Areas for further study

i) This study concentrated on improving service quality in tropical bank through
electronic banking, future research should attempt to collect data from all the
organizations in the banking industry.
ii) To study the true nature of the association between electronic banking service
delivery system and service quality, a longitudinal study is more appropriate.
iii) Other variables that affect customer satisfaction should also be considered in
assessing the level of service quality in the financial sector.
5.6 Study Limitations

i. Some people were not willing to review their information for fear of being
terminated by their bosses; however the researcher made sure that he informs
them that their information will be handled with confidentiality.
44
ii. The researcher anticipated finding some difficulty in seeking the cooperation of
respondents which includes the refusal and delays in completing questionnaires.
The researcher used all possible means to explain to the respondents about the
importance and urgency of this report such that they could be able to cooperate as
required.
iii. Some respondents felt insecure to reveal the correct information but the
researcher assured them that their responses are to be treated with much
confidentiality.
45
References
Amin, M.E. (2005). Social Science Research Conception. Methodology and an

examination of four fundamental questions, Journal of Management, Vol. 34,
Almossawi, M. (2011) Bank selection criteria employed by college students in Bahrain: an

empirical analysis, International Journal of Bank Marketing, 19 (3), pp. 115-25.
Bahia, K. and Nantel, J. (2000), A reliable and valid measurement scale for the
perceived service quality of banks, The International Journal of Bank Marketing,
Vol. 18 No. 2, pp. 8491.
Bulunywa, W. (1995), Uganda institute of bank marketing, vol 12 No 6 pp 10-18.
Blau, J. (2007, January 23). Hackers will target mobile banking, study warns. TechWorld.
Balachandher K. G., Santha V, Norhazlin I. and Rajendra P, (2011). Electronic Banking

in Malaysia: A Note on Evolution of Services and Consumer Reactions
Booz, Allen & Hamilton. (2007). Internet banking: a global study of potential. Booz,
Allen & Hamilton Inc., New York, NY.
Businge, J., (2013). "Uganda: Tropical Bank Posts Sh1.6 Billion Net Profit".
The Independent (Uganda).
Bennet, H and Durkin, M. (2000). "The Effects of Organizational Change on Employee

Psychological Attachment", Journal of Managerial Psychology, Vol. 15, pp
235-7.
Brady, M. F., Cronin, J. J. Jr. and Brand, R. R. (2001), Performance-only measurement

of service quality: A replication and extension, Journal of Business Research,
vol. 55 no. 1, pp. 17-31.
Chattopadhyay, S.P. (2001). "Improving the Speed of ISO 1400 Implementation: A

Framework for Increasing Productivity", Managerial Auditing Journal, Vol. 16,
pp 178-9.
Davis, F. D. (2009). Perceived Usefulness, Perceived Ease of Use, and User Acceptance
of Information Technology. MIS Quarterly, 13(3), 319-339.
Danaher, J. and Mattsson, J. (1998), A comparison of service delivery processes of

different complexity, International Journal of Service Industry Management,
Vol. 9 No. 1, pp. 4863.
Daniel E. (1999). Provision of Electronic Banking in the UK at the Republic of Ireland,

International Journal of Bank Marketing, Vol 17,No 2, pp 72-82.
46
Essinger, J. (2009). The Virtual Banking Revolution. The Customer, the Bank and the
Future.1st ed., International Thomson Business Press, London, UK.
Earl, M. (2010): Evolving the E-Business, Business Strategy Review, Vol.11, No. 2, pp
33-38.
Edwin, C., David, Y., & Andy C.,(2006). Adoption of internet banking: An empirical
study in Hong Kong. Decision Support Systems, 42 (3), 1558-1572.
Evans, D. (2004). An introduction to unified communications: challenges and

opportunities. In Aslib Proceedings: New Information Perspectives, 56, 17-20.
Francis Buteele (1996), SERVQUL, review, critique, research agenda. European journal
of marketing. Vol 3 No1
Gronroos, C. (1984). "A service quality model and its marketing implications," European
Journal of Marketing, Vol. 18, PP. 36-44.
Galloway, R (1994). Quality in retail banking. International journal of service industry

management vol 5 No 4
Hansson, J., Backlund, F and Lycke, L. (2003). "Managing Commitment: Increasing the
odds for Successful Implementation of TQM, TPM or RCM", International
Journal of Quality & Reliability Management, Vol. 20, pp 56-62.
Hsi-Peng Lu; Chin-Lung Hsu & Hsiu-Ying Hsu. (2005). An empirical study of the effect
of perceived risk upon intention to use online applications. Information
Management & Computer Security, 2005; 13, 2/3.
Jarvenpaa, S.L., and Todd, P.A. (2007). Consumer reactions to electronic shipping on the
World Wide Web. International Journal of Electronic Commerce, Vol. 1 No. 2,
pp. 59-88.
Jackson, S. (2001). "Successfully Implementing Total Quality Management tools within

Healthcare: What are the Key actions? ,International Journal of Health Care
Quality Assurance, Vol. 14, pp 21-8.
Johnston, R. (1995) The determinants of service quality: satisfiers and dissatisfiers, International
Journal of Service Industry Management, 6 (5), pp. 53-71.
Kendler, P.B. (2003). Core systems to improve. Bank Systems & Technology.
Leow, Hock Bee (2009), "New Distribution Channels in banking Services." Bankers
Journal Malaysia, No.110, June 1999, p.48-56.
Krejcie R. V. & Morgan D. W. (1970). Determining sample size for research activities,
Education and Psychology measurement, 30,608, Sage Publications
Liao, Z., and Cheung, M.T. (2011). Internet-based e-banking and consumer attitudes: an
47
empirical study. Information & Management, Vol. 39 No. 4, pp. 283-95.
Lewis, P., Saunders, M and Thornhill, A. (2004). "Developing an Explanatory theory of

Reward System Change", Personnel Review, Vol. 33, pp 91-8.
Kim, Y. Lee, S. Hemmington, N. and Yun, D. (2004) Competitive service quality

improvement (CSQI): A case study in the fast-food industry, Food Service
Technology, 4, pp. 75-84
Nadim, J., and Noorjahan B., (2008). The role of perceived usefulness, perceived ease of
use, security and privacy, and customer attitude to engender customer adaptation
in the context of electronic banking. African Journal of Business Management,
2(1), 032-040.
Njuru, J (2007). Challenges in implementing electronic banking strategy by commercial

banks in Kenya. Un published masters Thesis, University of Nairobi.
Ntayi (1999), Problem solving and Decision making approach and practical marketing
management.
Oso, W.Y., & Onen, D. (2005). A general guide to Writing Research Proposal and
Reports. A Handbook for Beginning Researchers (2nd ed). Makerere University
Press. Kampala Uganda.
Okumus, F. (2001). "Towards A Strategy Implementation Framework", International

Journal of Contemporary Hospitality Management, Vol. 13 No.7, pp 327-38.
Parasuraman, A., Zeithaml. V. A. and Berry, L. L. (1985) A conceptual model of service quality
and its implications for future research, Journal of Marketing, 49, pp. 41-50.
Parasuraman. A, Zeithamal, V.A and Berry L.L (1999), Perceived service quality as a
customer based performance measure.
Park, C., and Jun, J.K. (2013). Effects of internet usage, perceived risks, and
innovativeness. International Marketing Review, Vol. 20 No. 5, pp. 534-53.
Pavlou P.A. (2013). Consumer acceptance of electronic commerce: integrating trust and
risk with the technology acceptance model. International Journal of Electronic
Commerce, 7(3), 69-103.
Rose, Peter S., (2009) Commercial Bank Management(4th Ed), Irwin/McGraw-Hill,

Boston, USA.
Rotchanakitumunai, S., & Speece, M. (2003). Barriers of Internet banking adoption: a

qualitative study among corporate customers in Thailand. International journal of
Bank Marketing, 21(6-7), 312-323.
Ruyter, K., Wetzels, M., and Kleijnen, M. (2011). Customer Adoption of E-Service: An
48
Experimental Study. International Journal of Service Industry Management, Vol.
12, No. 2, pp.184-208.
Robert J (1997) identifying the critical determinants of service quality in retail and
Distribution management Vol 28 No 2
Sathye, M. (2009). Adoption of Internet banking by Australian consumers: an empirical

investigation. International Journal of Bank Marketing, Vol. 17 No. 7, pp. 324-
34.
Sureshchandar, G., Rajendran, C. and Anantharaman, R. (2002), Determinants of

customerperceived service quality: a confirmatory factor analysis approach,
Journal of Services Marketing, Vol. 16 No. 1, pp. 934.
Seth, N., Deshmukh, & P. V ., (2004). Service quality models: A review. International
Journal Quality and Reliability Management, 22(9), 36-51.
Thornton, Jennifer and White, Lesley. (2001). Customer Orientations and Usage of
Financial Distribution Channels. Journal of Services Marketing, Vol. 15 (3), 168-
185.
Villates D. (2007).Demain, la banquela distance, Banque 68-70
Yavas, U., Bilgin, Z. and Shemwell, D. (1997), Service quality in the banking sector in
an emerging economy: a consumer survey, The International Journal of Bank
Marketing, Vol. 15 No. 6, pp. 21723
49
APPENDIX I
QUESTIONNAIRE FOR STAFF MEMBERS OF TROPICAL BANK
Dear respondent,
I am a masters student at Makerere University Business School (MUBS) and in the
process of conducting research on the topic Improving Service Quality in Tropical
Bank through Electronic Banking. I believe you have a wide knowledge on the topic
being investigated. You have therefore been selected as one of the respondents for this
study and the information you provide will only be used for academic purposes. The
researcher promises to ensure maximum confidentiality of the data provided. I request
you to give your opinion as accurate as possible.
Thank you in advance
50
PART I: General Information
To each of the following items, indicate your response by ticking a number that best
represents your status.
1. Your gender:
Male (1) Female (2)
2. Your age (years):
19-30years (1) 31-40years (2) 41-50years (3) Above 50 (4)
3. Your highest level of education qualification:
Certificate (1) Diploma (2) Bachelors (3) Masters (4) Others (5)
4. Period spent in the organization:
Less than 1 year (1) 1 2 years (2) 3 4years (3) 5 years and above(4)
51
Section A: Service quality gaps in Tropical Bank
Please indicate the extent to which you agree with the statements below regarding
utilization and maintenance of electronic banking to improve service delivery
(SA- Agree, A- Agree, NS- Not Sure, D- Disagree and SD- Strongly Disagree)
Statement SA A NS D SD
Online banking services offered by tropical bank are 5 4 3 2 1

very reliable
Tropical bank easily respondents to customers 5 4 3 2 1

Online banking services offered by tropical bank can be 5 4 3 2 1

easily accessed at any time.
Tropical bank has in place skilled and experienced staff 5 4 3 2 1

that handle electronic banking services
Tropical bank has a clear and robust communication link 5 4 3 2 1

to address and update e.banking customers
The team that handles electronic banking at tropical 5 4 3 2 1

bank is very credible and experienced
The intangible nature of the electronic banking reduces 5 4 3 2 1

bureaucracy and red tape.
Tropical bank staff very friendly to their customers 5 4 3 2 1
Staff at Tropical bank provide care and undivided 5 4 3 2 1

attention to e.banking customer
Electronic banking services provide a lot of convenience 5 4 3 2 1

to customers.
52
Section B: Challenges in utilization and maintenance of electronic banking
Customers perception of risk associated with 5 4 3 2 1
Perceived risk increase with uncertainty and the 5 4 3 2 1
electronic banking is associated with the increase in 5 4 3 2 1
Breaches of security in electronic banking systems can 5 4 3 2 1
damage a banks reputation
Employees have negative attitude towards the use 5 4 3 2 1
of the electronic banking systems
There is lack of highly qualified and experienced staff 5 4 3 2 1
to manage and maintain electronic banking
There is lack of Corporation from the Senior 5 4 3 2 1
management
The Internet stability is unpredictable which affect the 5 4 3 2 1
electronic banking use.
Low levels of awareness about the benefits of 5 4 3 2 1
e.banking limits its use.
Poor customer care can hinder the use of electronic 5 4 3 2 1
banking
Do you think that business efficiency can be improved by electronic banking?
Yes No
If yes, why do you think so? Give reasons.
53
Section C: Suggestions to improve utilization and maintenance of electronic banking
Tropical bank should put in place training and 5 4 3 2 1
development sessions for its employees.
There should be an improvement in the level of 5 4 3 2 1
customer care service in the bank.
Tropical bank should outsource experienced staff with 5 4 3 2 1
expertise to manage electronic banking.
There should be positive involvement of top 5 4 3 2 1
management so as to support a new system
Tropical bank should provide encryption and strong 5 4 3 2 1
authentication to prevent fraud and identity theft
The bank should allocate sufficient funds to service, 5 4 3 2 1
maintain and upgrade the facilities use in e.banking
There should be Careful monitoring of the 5 4 3 2 1
implementation the e.banking processes.
Proper planning in the use and maintenance of 5 4 3 2 1
electronic banking should be enforced.
Tropical bank should increase its ability to control and 5 4 3 2 1
manage the various risks inherent in Internet banking
Tropical bank should sensitize its customers about the 5 4 3 2 1
benefits associated with the use of e.banking
Has the bank put in place any mechanism to prevent fraud and identity theft?
Yes No
If yes, what are these different mechanisms?
Thank You
54
APPENDIX II
QUESTIONNAIRE FOR CUSTOMERS OF TROPICAL BANK
Dear respondent,
I am a masters student at Makerere University Business School (MUBS) and in the
process of conducting research on the topic Improving Service Quality in Tropical
Bank through Electronic Banking. I believe you have a wide knowledge on the topic
being investigated. You have therefore been selected as one of the respondents for this
study and the information you provide will only be used for academic purposes. The
researcher promises to ensure maximum confidentiality of the data provided. I request
you to give your opinion as accurate as possible.
Thank you in advance
55
PART I: General Information
To each of the following items, indicate your response by ticking a number that best
represents your status.
1. Your gender:
Male (1) Female (2)
2. Your age (years):
19-30years (1) 31-40years (2) 41-50years (3) Above 50 (4)
3. Your highest level of education qualification:
Certificate (1) Diploma (2) Bachelors (3) Masters (4) Others (5)
4. Period spent in the organization:
Less than 1 year (1) 1 2 years (2) 3 4years (3) 5 years and above(4)
56
Section A: Service quality gaps in Tropical Bank
Online banking services offered by tropical bank are 5 4 3 2 1

reliable
Tropical bank easily respondents to customers 5 4 3 2 1

Online banking services offered by tropical bank can 5 4 3 2 1
be easily accessed at any time.
Tropical bank has in place skilled and experienced staff 5 4 3 2 1

that handle electronic banking services
Tropical bank has a clear and robust communication 5 4 3 2 1

link to address and update e.banking customers
The team that handles electronic banking at tropical 5 4 3 2 1

bank is very credible and experienced
The intangible nature of the electronic banking reduces 5 4 3 2 1

bureaucracy and red tape.
Tropical bank staff are very friendly to its clients 5 4 3 2 1
Staff at Tropical bank provide care and undivided 5 4 3 2 1

attention to electronic banking customer
Electronic banking services provide a lot of 5 4 3 2 1

convenience to customers.
57
Section B: Challenges in utilization and maintenance of electronic banking
Customers perception of risk associated with 5 4 3 2 1
Perceived risk increase with uncertainty and the 5 4 3 2 1
electronic banking is associated with the increase in 5 4 3 2 1
Breaches of security in electronic banking systems can 5 4 3 2 1
damage a banks reputation
Employees have negative attitude towards the use 5 4 3 2 1
of the electronic banking systems
There is lack of highly qualified and experienced staff 5 4 3 2 1
to manage and maintain e.banking
There is lack of Corporation from the Senior 5 4 3 2 1
management in the tropical bank
The Internet stability is unpredictable which affect the 5 4 3 2 1
electronic banking use.
Low levels of awareness about the benefits of 5 4 3 2 1
e.banking limits its use.
Poor customer care can hinder the use of electronic 5 4 3 2 1
banking
Do you think that business efficiency can be improved by electronic banking?
Yes No
If yes, why do you think so? Give reasons.
58
Section C: suggestions to improve utilization and maintenance of electronic banking
Tropical bank should put in place training and development 5 4 3 2 1
sessions for its employees.
There should be an improvement in the level of customer 5 4 3 2 1
care service in the bank.
Tropical bank should outsource experienced staff with 5 4 3 2 1
expertise to manage electronic banking.
There should be positive involvement of top management 5 4 3 2 1
in order to support a new system
Tropical bank should provide encryption and strong 5 4 3 2 1
authentication to prevent fraud and identity theft
The bank should allocate sufficient funds to service, 5 4 3 2 1
maintain and upgrade the facilities use in e.banking
There should be Careful monitoring of the implementation 5 4 3 2 1
the electronic banking processes.
Proper planning in the use and maintenance of electronic 5 4 3 2 1
banking should be enforced.
Tropical bank should increase its ability to control and 5 4 3 2 1
manage the various risks inherent in Internet banking
Tropical bank should sensitize its customers about the 5 4 3 2 1
benefits associated with the use of electronic banking
Has the bank put in place any mechanism to prevent fraud and identity theft?
Yes No
If yes, what are these different mechanisms?
Thank you
59
APPENDIX III
Table for Determining Appropriate Sample Size
N S N S N S
10 10 220 140 1200 291
15 14 230 144 1300 297
20 19 240 148 1400 302
25 24 250 152 1500 306
30 28 260 155 1600 310
35 32 270 159 1700 313
40 36 280 162 1800 317
45 40 290 165 1900 320
50 44 300 169 2000 322
55 48 320 175 2200 327
60 52 340 181 2400 331
65 56 360 186 2600 335
70 59 380 191 2800 338
75 63 400 196 3000 341
80 66 420 201 3500 346
85 70 440 205 4000 351
90 73 460 210 4500 354
95 76 480 214 5000 357
100 80 500 217 6000 361
110 86 550 226 7000 364
120 92 600 234 8000 367
130 97 650 242 9000 368
140 103 700 248 10000 370
150 108 750 254 15000 375
160 113 800 260 20000 377
170 118 850 265 30000 379
180 123 900 269 40000 380
190 127 950 274 50000 381
200 132 1000 278 75000 382
210 136 1100 285 1000000 384
60

Improving Service Quality in Tropical Bank Through Electronic Banking

Încărcat de

Informații document

Descriere originală:

Drepturi de autor

Formate disponibile

Partajați acest document

Partajați sau inserați document

Opțiuni de partajare

Vi se pare util acest document?

Este necorespunzător acest conținut?

Drepturi de autor:

Formate disponibile

Improving Service Quality in Tropical Bank Through Electronic Banking

Încărcat de

Drepturi de autor:

Formate disponibile

IMPROVING SERVICE QUALITY IN TROPICAL BANK

THROUGH ELECTRONIC BANKING

JIBRIL ABDI MOHAMUD

A RESEARCH REPORT SUBMITTED TO MAKERERE UNIVERSITY IN

PARTIAL FULFILLMENT OF THE REQUIREMENTS FOR THE

AWARD OF A MASTERS DEGREE OF BANKING AND

INVESTMENT OF MAKERERE UNIVERSITY

Jibril Abdi Mohamud

University with my approval as university supervisors.

Dr. Ngoma Muhammed

Dr. Vincent Bagire

directed me with love and encouragement. I am indeed grateful to you.

Thank you so much for your dedicated and inspiring work.

enjoyed fruitful discussions on challenging topics.

generosity in accepting to participate in the study is acknowledged and highly

information, comments and ideas.

Thank you all.

Figure 1: Showing whether business efficiency can be improved by electronic banking 31

data collected by use of a research administered questionnaire.

agreed and strongly agreed.

risk, Increase in companys transaction/operations risk, Reputational challenge, Security

challenge, Shortage of qualified Personnel and Quality of Infrastructure. Some of the

implementation process, capacity planning and upgrade of the security system.

1.1 Background to the study

that E-banking ensures 24-hours-a-day, seven-days-a-week accessibility, through any

type of advanced information system (Automated Teller Machines, Personal Computers,

Gronroos (1984) defines service quality as a judgment resulting from an evaluation

received. In todays fiercely competitive global market, organizations have formulated

their competitive advantage and increase their competitiveness. Service quality is

customer satisfaction and hence it becomes a key to competitive advantage (Almossawi

enterprises, as well as corporate organizations. The Banks portfolio includes transaction

to improve on the quality of services provided, Tropical bank in 2000 integrated

of challenges including delay in the delivery of transaction alert messages, outage of

1.2 Statement of the Problem

challenges including delay in the delivery of transaction alert messages, outage of

dissatisfaction among customers leading to increased customer defections (Bank of

therefore sought to critically examine how proper utilization and maintenance of

electronic banking would translate into improved service quality.

1.3 Purpose of the study

1.4 Objectives of the study

ii. To examine the challenges in utilization and maintenance of electronic banking in

iii. To propose institutional level of suggestions for utilization and maintenance of

electronic banking in Tropical Bank.

banking in Tropical Bank?

electronic banking in Tropical Bank?

1.6 Scope of the Study

1.6.1 Geographical Scope

along Kampala road opposite Cham towers.

1.6.2 Conceptual Scope

effective utilization of electronic banking to improve service quality in Tropical Bank

1.7 Significance of the study

banks and financial institutions to be aware of electronic banking as a product of

electronic commerce with of making strategic decisions.

militating against the implementation of electronic banking in tropical bank

will contribute immensely to the existing literature on the general application of e-

banking services in modern day business.

strategies to improve the use of electronic banking in financial institutions.

2.2 The concept of service quality

perceived service (Parasuraman, et al 1985). Perceived service quality is the consumers

may differ among individuals experiencing the same situation.

2.3 Determinants of Service Quality

responsiveness, accessibility, competence, credibility, courtesy, communication, security,

the other determinants include customer perception, consistence of service delivery,