A research report on benefits and challanges of internet banking for university students

Banking Academy of Vietnam
International School of Business

A Research Report
on
Benefits and challanges of internet banking for university students
Teacher: Truong Thuy Anh
Student: Nguyen Phuong Anh
Class: F14H
Course: Project 2

Hanoi, 19/7/2019

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Benefits and challanges of internet banking for university students

A primary research
on
Benefits and challanges of internet banking for university students
Nguyen Phuong Anh _ F14020
Class: F14H
Lecturer: Truong Thuy Anh
Course: Project 2
Mark:

Hanoi, 19/7/2019

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STATEMENT OFAUTHORSHIP
Students’ name: Nguyen Phuong Anh
Class: F14H
Student Number: F14020
Subject: Project 2
Lecturer: Truong Thuy Anh
Name of research paper:
BENEFITS AND CHALLANGES OF INTERNET BANKING FOR UNIVERSITY
STUDENTS
Declaration
I declare that the work attached is Plagiarismentirelyy own, and that I have given due
acknowledgeBysigningtheasdeclaration,requiredbyyouInternationalarestatingSchoolthatyouofhaveBusinessotplagiarized(ISB)..

IUseunderstandthefollowingthat theas aworkchecklistsubmitted. may be reproduced and/ or communicated for the

purpose

of detect ng plagiarism.
This work is entirely my own.

I have not copied another student’s work.


Signed _________________



I have not copied or used in any way material from a text, journal, website or
other published source without acknowledgement (including non – English
sources).



I have cited and referenced fully and correctly as required by the ISB where
applicable.
I have not reworded material from another source and presented it as my own.
I have not used this work in a previous class (self - plagiarism).




Abstract
The e-banking markets are currently under transition with a history of numerous tried and
failed solutions, and a future of promising but yet uncertain possibilities with potential new
technology innovations. The purpose of this article is to learn and analyze the factors that
influence consumers' decisions about the benefits and difficulties students encounter when
using online banking. To facilitate the analysis of literature, I have used mixed methods to


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Benefits and challanges of internet banking for university students
satisfy the research problems. The results demonstrate that most students use online
banking, but that's a small percentage of people who don't use even the ignorant. In
addition, the factors of convenience, customer service, and making payments easily can
determine whether to use online banking or not. It also indicates the devices need to be

connected to the network or the customer's certain knowledge of the smart device, failure
and repeated maintenance, some banking services that cannot be provided via e-banking
are 4 factors that influence the decision to use and are also the things that banks should
improve. As for the paper's significance, these findings not only reveal the benefits of
digital technology in its development as well as the glitches in the technology, but they also
show why the target users are university students who decided to use it so that banks could
develop and limit these errors.

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Benefits and challanges of internet banking for university students
Table of contents
Abstract......................................................................................................................................
List of figures.............................................................................................................................
1.

Introduction............................................................................................................................

2.

Literature review.....................................................................................................................

3.

Methodology...........................................................................................................................

4.

Results....................................................................................................................................

5.

Discussion

findings...........................................................................................................

5.1. The
services.............................
banking.....................................................................

5.3.
students......................................................
6. Recommendation..................................................................................................................

7. Conclusion............................................................................................................................

References................................................................................................................................

Appendices...............................................................................................................................

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Benefits and challanges of internet banking for university students

Figure 1: The most concerning factors to consumers in using internet banking
Figure
banking
Figure
banking
Figure 4: Satisfaction levels of customers................................................................................

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Benefits and challanges of internet banking for university students
1, Introduction
Internet banking or what often called e-banking is defined because the use of "service banks through
the pc network, offering a platform to support many e-commerce applications” (Martins, Oliveira,
Popovic, 2014) has been drawing people's attention for the convenience and their adoption of this
application, and has been highly effective. A digital bank may be a bank which will do most of the
net banking transactions over the net, customers don't must attend a bank branch and reduce
paperwork. Besides, online banking also helps banks offer a potentially low-cost alternative to a
standard branch bank. As a result, e-banking has enjoyed an incredible growth in popularity through
the growing spread of the web because it is now rapidly becoming an alternate channel to produce
services and products of the bank. Burnham noticed that while traditional banks’operating costs
account for between 50% and 60% of revenues, running costs of Internet banking is estimated at
between 15% and 20% of revenues (Allen & Hamilton 1997). This outbreak has generated concern
among Vietnamese consumers generally during this topic especially among students at universities
in Vietnam.

This is thanks to the growing demand for convenience and services, including the accessibility and
availability of knowledge technology in digital today. Additionally, online banks also allow users to

conduct financial transactions via the network like viewing account balances, receiving reports,
checking recent transactions, transferring money between accounts, making payments and providing
e-wallet services to raised meet customers' needs. Therefore, many folks have chosen to use internet
banking if it's not necessary for traditional banking. Among the numerous consumers of various
ages, there are an oversized number of school students who are more likely to adopt and access new
applications while people are still inaccessible and may not access things of recent technology, such
a large amount of people still choose the old method to use. However, some journalists who
comprehend the recognition of those specific age groups decide whether to use this application
regarding quality customer services, online system quality and translation quality of banking
services.

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Benefits and challanges of internet banking for university students
Despite promising results, these studies also present variety of limitations of the challenges and
security threats moreover because the relationship between confidentiality to customer trust, and
other factors that result in security issues, motivating factors and use intentions not only consumers
but also students at universities can meet their needs or not. Currently, most digital banks reduce
some costs and cumbersome procedures. However, this development still faces many difficulties
like the habit of using banking services through traditional service channels of some customer
segments and therefore the popularity and network don't seem to be popular among regions,
backward and remote compared to the developed urban areas. Therefore, this paper, because the
results of our research, aims to answer three questions: “ What are the factors that influence students
in choosing an internet banking service?” ; “ What benefits has the IB service given users?” ; “
What are the determinants and outcomes of internet banking adoption?”. Furthermore, there'll be
highlights, benefits of using online banking for college kids relative to other age groups, and
challenges in increasing the frequency of using and within the promotion of banks with potential

customers.

2. Literature Review
Unfortunately, there has been little or no formal investigation into the advantages and challenges of
using online banking for college kids thus far. Admittedly, many journalists have tried to approach
this issue, but it's also difficult to draw a particular conclusion or result with relevance customer
acceptance of banking service. A previous research suggested that customers don't use online
banking because all of them have negative perceptions about service risks, while many reports that
they need no have to use online banking (The Infocomm Development Authority of Singapore,
2002) consistent with Parasuraman et al. (1988) “ it's believed that customers identified five qualityof-service decisions supported a series of focus group interviews including tangibles, reliability,
responsiveness, assurance and empathy”. Furthermore, within the 2000s, mobile payment services
became a scorching topic and remained so even after the explosion of the net hype. To facilitate the
event of higher mobile payment services, it's important to grasp the teachings of this history by
learning what previous studies have discovered about mobile payments and about the mobile
payment services markets, likewise as what issues have remained unanswered (Carat, 2002).

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Benefits and challanges of internet banking for university students
The improvement of online banking and its increased use by consumers worldwide has made this
service a privileged target for cyber criminals although banks have founded security systems to
confirm that transactions conducted online are shielded from internet security threats. In fact,
electronic banking involves several particular operational risks: one mainly associated with the
protection of systems and transactions, including data confidentiality and authentication of the
parties involved, and another concerning the continual availability of the web for financial
transactions resulting in significant hazards, like hackers and computer viruses (Sokolov, 2007).
Cyber crime, also referred to as computer crime or electronic crime, is an economic crime

committed using computers and therefore the internet. Typical samples of cybercrime are
distributing viruses, illegally downloading files, phishing and pharming and stealing personal
information like checking account details (PCW, 2014a) .

3. Methodology
Along with the development of technology, internet banking is currently one of the most popular
forms of self-service technology used in the banking industry. Therefore, the methods of qualitative
and quantitative research will discover the factors affecting the intentions of customers to use online
banking serveral. This study is particularly relevant for answering questions where quantitative
research has not yet been done and can easily explain, describe, understand more about attitudes,
behaviors, motivations, intentions and use purposes of consumers to satisfy the needs that customers
offer. Quantitative can also use different methods to quantify, measure, inflect and interpret the
relationships between factors (variables) with each other in the form of measures and statistics.
From the collected data about the behavior and the reasons affecting the behavior of consumers, to
better understand the needs, wants as well as the benefits and disadvantages that the bank’s services
bring. Now to be successful in data collection interviewing is the best approach, in fact, a problem
interview refers to a controlled situation in which a particular person (interviewer) will ask some
questions related to a particular problem to another person (respondent). Interviewing is a
participatory process where the interviewees listen carefully and the Interviewer will listen to
respondents' opinions on questions asked, thereby gaining insight into the issues mentioned by the
above person. This interview will not take too long and can be quickly retrieved from

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Benefits and challanges of internet banking for university students
consumers. Although it takes time to find the right audience and ask many questions at the same
time, instead of doing that one should allocate time and choose the right questions for each object.

The intention of method is to build a scale of several factors that affect the intended use of
customers using Internet banking services in Ha Noi, determine the impact of each factor on the
intended use of the guest in the use of Internet banking services in Ha Noi and verifying the
proposed research model with real data in Ha Noi City. This in turn helps banks focus on the factors
that increase their intentions and improve service performance using online banking services in Ha
Noi City in particular and Vietnam in general. The data used in this report will be collected from a
survey carried out within Hanoi University. At first, an interview consisted of 8 questions including
3 multiple choice questions, 2 closed questions and 2 graphic scale questions designed with respect
to our three research questions. In the next step, choosing 200 students including students who study
at Banking Academy in Ha Noi compared to people some other universities in are using the internet
and having transactions with banking with any type of service, studying away from home or living
with family used online survey and send that link to the right people looking for, mean while,
interviewer will take note of each person’s answer. This method will save the interviewers time and
money in moving around to find the subject. In other words, it is the fastest way to get full answers
from them. Therefore, I believe that the data obtained is quite high level of fidelity and were more
involved compared to conventional separated ones. In addition, we conducted various in-depth
interviews with my participants to clarify, confirm points in the results and draw the best
conclusion.

4. Results
The participants of the project were classified according to their background information into one
group: 200 students from Ha Noi universities, especially students studying at Banking Academy by
broadcasting a survey via google forms. Using 8 survey questions to answer 3 research questions
about the factors affecting the decision to use as well as the benefits that it brings to users and
outcomes when applying internet banking. However, when most students have been using online
banking, accounting for more than 90%, there were still about 8-8,5%

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Benefits and challanges of internet banking for university students
of those who did not use or even know about online banking. Besides, this article of mine
would provide scientific charts, specifically about the datas that I have surveyed.
Figure 1: The most concerning factors to consumers in using internet banking
20.58%
27.03%

25.36%

Convenience
Customer services
Shipping factors (Time and Fee)
Security (Guile, Reveal personal information, etc...)
As shown in Figure 1, the above factors were all important to consumers and evenly
distributed, but their needs were mostly focused on the convenience and customer services
that online banks could provide to 27%. After that the percentage of shipping factors about
time and fee were 2% lower than that of convenience and consumer services and the
security factors accounted for 21%.

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Benefits and challanges of internet banking for university students

Figure 2: Difficulties in using internet banking
Requiring internet connection

Having error and having to maintain many times
Requiring to have certain knowledge of smart devices and network skills
Some bank services cannot be provided via e-banking channels
Others1%
0%
Along with the development of modern technology, many times have improved online
banking but still face some challenges, and then many customers have chosen not to use
them. Firstly, connecting to the internet to be able to use, accounting for 30%. Secondly,
some banking services were not even provided through online banking or had errors and
maintenance many times to maintain 26% and 25%. Finally, a problem was significantly
worrying to around 18% that some people still did not know how to operate and use the
remaining 1% mainly some people never used to not know the drawbacks encountered
when using it.

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Benefits and challanges of internet banking for university students

Figure 3: The benefits of choosing internet banking

It was also noticeable that when it came to choosing internet banking instead of traditional
banks, in fact, consumers could use apps anywhere anytime compared to the four
remaining benefits was 33%, which was nearly double that of online banking and was
faster payment to 15%. Other benefits of saving time and increasing work efficiency were
31% and 20%. The remaining 1% was easier to transfer money from one place to another.
Figure 4: Satisfaction levels of consumers

37%

39%
35%

28%

17%
16%
11%
9%

5%
Extremely good

3%
Terrible

Avarage
Services Usability

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Benefits and challanges of internet banking for university students
Looking at the details provided in Figure 5, services and usability were rated quite well in
the range of 37-39% and the rest of reviews said that they were extremely bad, falling in

the range of 3-5%. Overall services and usability were good for customers.
5. Discussion of findings
The project, having specific survey results above, but there was still a limit to the answers
to the research questions from all perspectives of college students in using online banking.
The data collected is relatively limited because the participants come from a specific target
group at some universities in Ha Noi, especially the banking academy. However, the study
sought to generalize the data and I confirm that it is possible to infer a certain level of
generalization from the data already collected.
5.1. The most concerning factors and difficulties to use banking services
The results presented in Figure 1 and Figure 2, after the survey, I found that there are 5
factors that mainly affect the decision of consumers and 4 difficulties encountered when
using online banking. It is almost certain that it is the development of technology in general
and the Internet in particular that has brought a lot of changes in the habits of consumers.
To make a decision to use an online banking services, consumers have to think and learn
about the factors that services bring such as: convenience, customer services, shipping
factors including time and fee and security about guile, reveal personal information and so
on. People mostly choose to use it because of convenience and customer services.
However, before that, users still face some difficulties and disadvantages in terms of
requiring internet connection, having errors, having to maintain many times, requiring
customers to have certain knowledge of smart devices and network skills, even some bank
services cannot be provided via e-banking channels and many more. The most annoying
thing having to be able to connect the device to the internet. Consumers think these things
are troublesome so they decide to use traditional banking instead of internet banking. This
phenomenon is explained by the statement below: Using online banking is not necessary
for students attending college near home or in the same city” by NP - the interviewee of my
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Benefits and challanges of internet banking for university students
research. With the growth of technology, especially technology 4G, the data collected
under this section may indicate that the allocation of more and more online banking is
really necessary, especially in the young people. Apparently, besides the positive factors of
using online banking to customers, it is also known that difficulties can cause some
consequences from using internet banking.
5.2. The benefits of choosing internet banking
People’s social and cultural environment include the growth of the Internet and mobile
networks into commercial channels, as well as increasing automation influence their
consumption habits, and thus the demand for new services. Changes in these environments
can cause different needs and thus affect the provision and requirements of new services.
People choose to use online banking because it can save a lot of time in solving problems,
pay quickly without transaction fees, for example they paid all their bills on payday as they
always did or prepaid phone recharge, increase work efficiency and can be used anytime,
anywhere in the form of online via the internet with a smartphone or computer. Therefore,
customers will not need to personally come to branches or transaction offices of banks to
conduct transactions through which minimization to the maximum extent of the paperwork
involved is cumbersome, while autonomy is time themselves, they do not have to depend
too much on the working hours of the bank. Additionally, the whole group surveyed agreed
that internet banking with faster payments does not interest them much as it had the lowest
percentage, meanwhile, using online banking anywhere anytime was the highest on the
total. Furthermore, Hampel et al. discuss the foundations of mobile electronic commerce
and analyze those characteristics of mobile telephony that offer potential for mobile
telecommunication service providers to take a greater role in retail payments. Thanks to
online banking services, not only do they benefit consumers, but banks also save
considerable money.
5.3. Satisfaction levels in consumption of ISBA students

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Benefits and challanges of internet banking for university students
One of the biggest challenges for the commercial banking system in terms of integration is
competitiveness. A bank that wants to develop sustainably cannot care about keeping existing
customers and finding new customers. Therefore, satisfying the needs of customers is one of the
main factors leading to the success of the company. Over time, along with the progress of science
and technology and the process of international integration of our country, people's income and
living standards are increasing day by day. This leads to increasing customer demand, and to do this,
banks need to understand the level of customer satisfaction about the services they are provided,
identify the factors that make customers satisfied and quantify it. This is simply because customers
are a prerequisite for the bank's existence and development. The key to success in competition is to
maintain and continuously improve service quality by meeting the needs of customers in the best
way. Making customers satisfied has become an important asset for businesses and organizations in
their efforts to improve service quality, thereby enhancing their competitiveness. According to the
data surveyed above, everyone is satisfied with the services and usability of online banks. However,
a very small number of people feel that using online banking is extremely bad and they do not want
to use it even knowing nothing about it. Therefore, when using the services, if customers feel the
high quality service they will be satisfied with its services. Conversely, if customers perceive the
low quality services, the dissatisfaction will appear.

6. Recommendations
From the discussion on the findings, there are some following recommendations that should be
taken into consideration of online banking's challenges and benefits and the factors influencing
customer choice. Currently, with the explosion of information technology - technology 4.0, the
demand for goods transactions and payment by electronic services is increasingly popular and
popular because of its convenience and speed. Therefore, commercial banks in our country should
be aware of the role and benefits that mobile banking brings, so they are increasingly interested in
and developing this service. Therefore, in order for mobile banking services to develop quickly and

sustainably, it is advisable to focus on investing in data security and safety technology from
countries with advanced

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Benefits and challanges of internet banking for university students
technology. Secondly, it is necessary to develop the network system by upgrading and
expanding the transmission line, with large capacity and high speed to avoid network
congestion and many more. On the part of consumers, especially university students, they
should equip themselves to improve their knowledge and necessary skills in using network
technology as well as basic knowledge in using online banking to avoid unfortunate
incidents.
7. Conclusion
In conclusion, I expect that the obtained results of my project can provide a deeper and
more thorough understanding of customers or students at some universities in Hanoi,
especially students at Banking Academy about the benefits as well as challenges and
difficulties of using internet banking. Banking services via mobile phone (mobile banking)
or smart devices is a hot topic, as factors in the face of changing market banking services
and online payment. For banks, the implementation of online banking services helps to
save costs, improve profits and improve competitiveness. For customers, online banking
services bring convenience, save time and costs. Overall, the application of new technology
in banking activities is aimed at a civilized society, creating many payment utilities for
users, and minimizing operational operations at the bank. Besides, with the increasing
appearance of security risks, the new authentication technologies that banks are testing can
only be an additional factor, contributing to the convenience of customers and it is not
possible to overcome the weaknesses of the system. The security risks to the deployment of
services on smart devices need to be seriously considered in order to make appropriate

countermeasures. The development of payment applications that have not been
synchronized with companies providing products and services sometimes causes
inconvenience to users and does not increase payment value for related parties. The above
study only focused on 200 students at some universities in Hanoi and these subjects are not
large enough to cover the results of all universities in the country. In the future, hopefully
there will be more research articles on the booming trend of new age banking and the
development of technology for people aged over 50.
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Benefits and challanges of internet banking for university students
( 3170 words)

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Benefits and challanges of internet banking for university students
References
Booz-Allen & Hamilton. “Booz-Allen’s Worldwide Survey Revealed a Huge Per- ception Gap
Between Japanese and American/European Banks Regarding Internet Banking,” 1997
( current April 22, 1997)
Citeseerx.ist.psu.edu. 2021. [online] Available at:
< />doi=10.1.1.177.750&rep=rep1&type=pdf> [Accessed 12 July 2021].

G. Carat, e payment systems database – trends and analysis, Technical report,
Background Paper No. 9, Electronic Payment Systems Observatory (ePSO),

EUR 20264 EN, Seville, Spain, 2002.
Parasuraman, A., Zeithaml, V.A. and Berry, L.L. (1988), “ SERVQUAL: A multi item
scale for measuring consumer perception of service quality” , Journal of
Retailing, Vol.64, pp. 12-40.
PWC (2014a) Threats to the Financial Services Sector, Global Economic Crime Survey.
2021. [online] Available at:
< />[Accessed 29 May 2021].
Sokolov, D. (2007) E-Banking: Risk Management Practices of the Estonian Banks,
TUTWPE No.156, pp.21-37.

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Benefits and challanges of internet banking for university students
Appendices
Questionnaire
I am Nguyen Phuong Anh, ISBA student, Banking Academy. I am doing a research project
on benefits and challenges of internet banking for university students. This questionnaire is
designed to help me collect data for my research project. I highly appreciate your opinions
and responses which will be a necessary contribution to the completion as well as the
quality of my project. Please submit your result as soon as your completed questionnaire.
Thank you for your cooperation.

1, Do you use internet banking?
о Yes
о No

2, Do you know about internet banking?

ο Yes
ο No

3, Have you used internet banking?
ο Used
ο Not used yet

4, Why do you use internet banking?
ο Increasing work efficiency
ο Save time
ο Using anywhere anytime
ο Faster payment, agio
ο Others (Please specify)

……………………………………………………………………………….
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Benefits and challanges of internet banking for university students
5, What are the difficulties in using the services of online banking for consumers? (You
can choose more than one answer)
ο Requiring an internet connection
ο Some banking services cannot be provided via e-banking channels
ο Requiring customers to have certain knowledge of smart devices and network skills
ο Having error and having to maintain many times
ο Others (Please specify)

……………………………………………………………………………..

6, Which of the following factors are the most important when deciding to use a bank
online? (You need to choose 3 most important factors)
ο Convenience
ο Shipping Factors (Time and Fee)
ο Customer Service
ο Security (guile, reveal personal information, etc.)

7, How effective are you in terms of service features that e-banking offer to customers?

8, How would you evaluate the effectiveness of using banking services?

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