Internet Banking: An Empirical Study Of Adoption Rates Among Midwest Community Banks

Abstract

As the internet becomes more important for commerce, internet websites are playing a more central role in most companies' business plans. The success of internet banking is determined not only by banks or government support, but also by customers' acceptance of it. Online banking acceptance has gained special attention in academic studies during the past several years as banks move toward implementing internet banking as part of their overall strategy. The business benefit of internet banking is to generate additional revenue, improve customer service, extend marketing, and increase cost savings. In accepting the internet and maximizing its potential, there are several stages that firms evolve through that involve different roles. These different stages of changes are reflected in the many levels that are present when firms go through the adaptation of new technology, including internet banking. From the literature review, some key questions were identified, especially to what extent banks should modify their internet services for customers. The aim of this paper was to identify those areas in which the banks could improve or modify their services to increase the adoption rate of internet banking. Data were gathered from non-internet banking users via a survey questionnaire. The results of the respondents were analyzed using Structured Equation Modeling (SEM) from which the hypotheses were tested and conclusions drawn. The results from the survey indicated that customers find it difficult to use internet banking services, which leads to a decrease in the adoption of internet banking.