MRP Ankit Kanugo Updated 14-9-11 Final

7/30/2019 MRP Ankit Kanugo Updated 14-9-11 Final

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SWAMI VIVEKANAND COLLEGE OF ENGINEERING, INDORE

SCHOOL OF MANAGEMENT

A PROJECT REPORT

ON

A Comprehensive Study of Customers Preferences

Towards Traditional Banking Services and

Mobile Banking Services, in Indore Region

Submitted toDevi Ahilya Vishwavidyalaya, Indore for the partial fulfillment

for the degree of Master of Business Administration (2009-11)

Guided by: Submitted by:

Prof. Pallavi Sharma Ankit kanugoM.B.A. IV Semester

Enroll. No: D09MBA1440023

Roll No: 09170131


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Certificate

This is to certify that the Project Report entitled A Comprehensive Study of Customers

Preferences Towards Traditional Banking Services and Mobile Banking Services, inIndore Region, which is being submitted herewith for the award of the degree of Master of

Business Administration of DEVI AHILYA VISHWAVIDHYALAYA, INDORE is the result of

the original research work completed by Mr. Ankit Kanugo under my supervision and

guidance.

To the best of my knowledge and belief, the work has been duly completed and is up to the

standard both in respect of contents and language for being referred to the examiner.

Signature of Supervisor

(Prof. Pallavi Sharma)

Signature of the Principal/Director

(seal)


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Acknowledgement

I would like to thank my project guide Prof. Pallavi Sharma for guiding me through my

research project. Her encouragement, time and effort are greatly appreciated

I would like to dedicate this project to my parents. Without their help and constant support this

project would not have been possible.

I would like to thank all the respondents who offered their opinions and suggestions through

the survey that was conducted by me in Indore Region.

Last but not the least; I would like to thank my college Director Prof. Axay Dube and all those

who supported me directly or indirectly in completing my Major research project.

Ankit Kanugo

M.B.A. IV Semester


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TABLE OF CONTENT

S .No. Particulars Page.

No.

1 Declaration I

2 Certificate II

3 Acknowledgement III

4 Table of Content IV

5 Index of Tables V

6 Index of Graph and Picture VI

7 Chapter 1 Introduction

1.1 History1.2 Traditional banking services

1.3 Functions of Commercial Banks

1.4 Economic functions

1.5 Mobile Banking

8 Chapter 2 Review of Literature

2.1 Excerpts from related Literature

2.2 Problem Statement

2.3 Rationale of study

9 Chapter 3 Research methodology

3.1 Objectives3.2 Research Design

3.3 Type of Research Study

3.4 Sample size

3.5 Tools used for data collection

3.6 Tools used for data analysis

10 Chapter 4 Data Analysis and Interpretation

11 Chapter 5 Finding and Discussion

12 Chapter - 6 Co ncl usi on and S ugg est ion

13 Chapter 7 Implication of study7.1 Limitation of research

7.2 Direction For Future Research

14 References

15 Annexure

Questionnaire


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Index of table

S.NO Table Page No.

Tab-4.1 Target Respondents

Tab-4 .2 Awareness of Mobile Banking

Tab-4.3 Availability of Mobile Banking Services

Tab-4.4 Availability of instrument/ medium

Tab-4.5 Future scope of mobile banking services

Tab-4.6 Facility from bank to customer

Tab-4.7 Usage of Mobile Banking

Tab-4.8 Convenience to use technology

Tab-4.9 Security factor in Mobile Banking

Tab-4.10 Usage of Traditional Banking

Tab-4.11 Service mostly use in Traditional Banking Services

Tab-4.12 Telephonic use in Banking by respondents

Tab-4.13 Use of ATM by respondents

Tab-4.14 Use of internet banking by respondents

Tab-4.15 Use of mobile banking for trading and shopping

Tab-9.1 Failure bank list


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Index of Graphs and Pictures

S.NO Graphs and pictures Page No.

Graph-4.1 Target Respondents

Graph-4 .2 Awareness of Mobile Banking

Graph-4.3 Availability of Mobile Banking Services

Graph-4.4 Availability of instrument/ medium

Graph-4.5 Future scope of mobile banking services

Graph-4.6 Facility from bank to customer

Graph-4.7 Usage of Mobile Banking

Graph 4.8 Convenience to use technology

Graph-4.9 Security factor in Mobile Banking

Graph-4.10 Usage of Traditional Banking

Graph-4.11 Service mostly use in Traditional Banking Services

Graph-4.12 Telephonic use in Banking by respondents

Graph-4.13 Use of ATM by respondents

Graph-4.14 Use of internet banking by respondents

Graph-4.15 Use of mobile banking for trading and shopping

Pic-9.1 Mobile Banking Process


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Chapter 11. Introduction


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1. Introduction

This research report is on topic A comprehensive study of customers preferences towards

traditional banking services and mobile Banking Services, in Indore region. This research study

shows the factor influencing customer preference towards banking services.To explore the

opportunities and challenges present for banking sector.

Banking is a system of trading in money which involved safeguarding deposits and making

funds available for borrowers. Traditional banking services means the old way or process of the

banking services which is fallowed from several years. It means the accepting, for the purpose of

lending or investment, of deposits of money from the public, repayable on demand or otherwise,

and withdrawal by cheque, draft, and order.

The terms mobile bankingrefer Collectively to a set of applications that enable people to usetheir mobile telephones to manipulate their bank accounts, store value in an account linked to

their handsets, transfer funds, or even access credit or insurance products.

Limitation of Internet Banking, as it reduces the customer requirement to just a mobile phone.

Mobile usage has seen an explosive growth in Indian economy. The main reason that MobileBanking scores over Internet Banking is that it enables Anywhere Anytime Banking'.

Customers don't need access to a computer terminal to access their bank accounts, now the cando so on-the-go Internet Banking helped give the customer's anytime access to their banks.

Customer's could check out their account details, get their bank statements, perform transactions

like transferring money to other accounts and pay their bills sitting in the comfort of their homes

and offices. However the biggest limitation of Internet banking is the requirement of a PC with

an Internet connection, not a big obstacle if we look at the US and the European countries, but

definitely a big barrier if we consider most of the developing countries of Asia like India.

Mobile banking addresses this fundamental while waiting for the bus to work, traveling or when

they are waiting for their orders to come through in a restaurant.


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1.1 History

Banking in India originated in the last decades of the 18th century. The first banks were The

General Bank of India, which started in 1786, and Bank of Hindustan, which started in 1790;

both are now defunct. The oldest bank in existence in India is the State Bank of India, which

originated in the Bank of Calcutta in June 1806, which almost immediately became the Bank of

Bengal. This was one of the three presidency banks, the other two being the Bank of

Bombay and the Bank of Madras, all three of which were established under charters from the

British East India Company. For many years the Presidency banks acted as quasi-central banks,

as did their successors. The three banks merged in 1921 to form the Imperial Bank of India,

which, upon India's independence, became the State Bank ofIndia.

The Reserve Bank of India, India's central banking authority, was nationalized on January 1,

1949 under the terms of the Reserve Bank of India (Transfer to Public Ownership) Act, 1948

(RBI, 2005b). In 1949, the Banking Regulation Act was enacted which empowered the Reserve

Bank of India (RBI) "to regulate, control, and inspect the banks in India."

Foreign banks too started to arrive, particularly in Calcutta, in the 1860s. The Comptoire

d'Escompte de Paris opened a branch in Calcutta in 1860, and another in Bombay in 1862;

branches in Madras and Puducherry, then a French colony, followed. HSBC established itself inBengal in 1869. Calcutta was the most active trading port in India, mainly due to the trade of

the British Empire, and so became a banking center.

The first entirely Indian joint stock bank was the Oudh Commercial Bank, established in 1881

in Faizabad. It failed in 1958. The next was the Punjab National Bank, established in Lahore in

1895, which has survived to the present and is now one of the largest banks in India.

During the First World War (1914-1918) through the end of the Second World War (1939-1945),

and two years thereafter until the independence of India were challenging for Indian banking.

The years of the First World War were turbulent, and it took its toll with banks simply collapsing

despite the Indian economy gaining indirect boost due to war-related economic activities. At

least 94 banks in India failed between 1913 and 1918 as indicated in the table (appendix 1).
http://en.wikipedia.org/wiki/HSBChttp://en.wikipedia.org/wiki/Faizabadhttp://en.wikipedia.org/wiki/HSBChttp://en.wikipedia.org/wiki/Faizabad


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1.2 Traditional Banking Services

1.3 Functions of Commercial Banks

The functions of commercial banks are divided into two categories:

1.7.1 Primary functions, and

1.7.2 Secondary functions including agency functions.

1.3.1 Primary functions

The primary functions of a commercial bank include:

Retail

Business loan

Cheque account

Credit card

Home loan

Insurance advisor

Mutual fund

Personal loan

Savings account

Wholesale

Capital raising (Equity / Debt / Hybrids)

Mezzanine finance

Project finance

Revolving credit

Risk management (FX, interest

rates, commodities, derivatives)

Term loan
http://en.wikipedia.org/wiki/Checking_accounthttp://en.wikipedia.org/wiki/Checking_account


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a) Accepting deposits; and

b) Granting loans and advances.

a) Accepting deposits

The most important activity of a commercial bank is to mobilize deposits from the

public. People who have surplus income and savings find it convenient to deposit the

amounts with banks. Depending upon the nature of deposits, funds deposited with bank

also earn interest. Thus, deposits with the bank grow along with the interest earned. If

the rate of interest is higher, public are motivated to deposit more funds with the bank.

There is also safety of funds deposited with the bank.

b) Grant of loans and advances

The second important function of a commercial bank is to grant loans and advances.

Such loans and advances are given to members of the public and to the business

community at a higher rate of interest than allowed by banks on various deposit

accounts. The rate of interest charged on loans and advances varies depending upon the

purpose, period and the mode of repayment. The difference between the rate of interest

allowed on deposits and the rate charged on the Loans is the main source of a banks

income.

1.3.2 Secondary functions


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Besides the primary functions of accepting deposits and lending money, banks perform a

number of other functions which are called secondary functions. These are as follows -

a) Issuing letters of credit, travellers cheques, circular notes etc.

b) Undertaking safe custody of valuables, important documents, and securities by providing

safe deposit vaults or lockers.

c) Providing customers with facilities of foreign exchange.

d) Transferring money from one place to another; and from one branch to another branch of

the bank.

e) Standing guarantee on behalf of its customers, for making payments for purchase of

goods, machinery, vehicles etc.

f) Collecting and supplying business information.

g) Issuing demand drafts and pay orders.

h) Providing reports on the credit worthiness of customers.


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1.4 Economic functions

The economic functions of banks include:

1. Issue of money, in the form of banknotes and current accounts subject to cheque or

payment at the customer's order. These claims on banks can act as money because they

are negotiable or repayable on demand, and hence valued at par. They are effectively

transferable by mere delivery, in the case of banknotes, or by drawing a cheque that the

payee may bank or cash.

2. Netting and settlement of payments banks act as both collection and paying agents for

customers, participating in interbank clearing and settlement systems to collect, present,

be presented with, and pay payment instruments. This enables banks to economies on

reserves held for settlement of payments, since inward and outward payments offset

each other. It also enables the offsetting of payment flows between geographical areas,

reducing the cost of settlement between them.

3. Credit intermediation banks borrow and lend back-to-back on their own account as

middle men.

4. Credit quality improvement banks lend money to ordinary commercial and personal

borrowers (ordinary credit quality), but are high quality borrowers. The improvement

comes from diversification of the bank's assets and capital which provides a buffer to

absorb losses without defaulting on its obligations. However, banknotes and deposits are

generally unsecured; if the bank gets into difficulty and pledges assets as security, to rise

the funding it needs to continue to operate, this puts the note holders and depositors in

an economically subordinated position.

5. Maturity transformation banks borrow more on demand debt and short term debt, but

provide more long term loans. In other words, they borrow short and lend long. With a

stronger credit quality than most other borrowers, banks can do this by aggregatingissues and redemptions, maintaining reserves of cash, investing in marketable securities

that can be readily converted to cash if needed, and raising replacement funding as

needed from various sources (e.g. wholesale cash markets and securities markets).

1.5 Mobile Banking
http://en.wikipedia.org/wiki/Chequehttp://en.wikipedia.org/wiki/Cheque


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Mobile banking (also known as M-Banking, mbanking, SMS Banking) is a term used for

performing balance checks, account transactions, payments, credit applications and other

banking transactions through a mobile device such as a mobile phone or Personal Digital

Assistant (PDA). The earliest mobile banking services were offered over SMS. With the

introduction of the first primitive smart phones with WAP support enabling the use of the mobile

web in 1999, the first European banks started to offer mobile banking on this platform to their

customer

Mobile banking has until recently (2011) most often been performed via SMS or the Mobile

Web. Apple's initial success with iPhone and the rapid growth of phones based on Google's

Android (operating system) have led to increasing use of special client programs, called apps,

downloaded to the mobile device

1.5.1 A mobile banking conceptual model

In one academic model, mobile banking is defined as:

Mobile Banking refers to provision and availment of banking- and financial services with the

help of mobile telecommunication devices. The scope of offered services may include facilities

to conduct bank and stock market transactions, to administer accounts and to access customized

information."

According to the model Mobile Banking can be said to consist of three inter-related concepts:

Mobile Accounting

Mobile Brokerage

Mobile Financial Information Services

1.5.2 Trends in mobile banking
http://en.wikipedia.org/wiki/IPhonehttp://en.wikipedia.org/wiki/IPhone


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The advent of the Internet has enabled new ways to conduct banking business, resulting in the

creation of new institutions, such as online banks, online brokers and wealth managers. Such

institutions still account for a tiny percentage of the industry.

Over the last few years, the mobile and wireless market has been one of the fastest growing

markets in the world and it is still growing at a rapid pace. According to the GSM Association

and Ovum, the number of mobile subscribers exceeded 2 billion in September 2005, and now

(2009) exceeds 2.5 billion (of which more than 2 billion are GSM).

According to a study by financial consultancy Celent, 35% of online banking households will be

using mobile banking by 2010, up from less than 1% today. Upwards of 70% of bank center call

volume is projected to come from mobile phones. Mobile banking will eventually allow users to

make payments at the physical point of sale. "Mobile contactless payments will make up 10%

of the contactless market by 2010.Another study from 2010 by Berg Insight forecasts that the

number of mobile banking users in the US will grow from 12 million in 2009 to 86 million in

2015. The same study also predicts that the European market will grow from 7 million mobile

banking users in 2009 to 115 million users in 2015.

Many believe that mobile users have just started to fully utilize the data capabilities in their

mobile phones. In Asian countries like India, China, Bangladesh, Indonesia and Philippines,where mobile infrastructure is comparatively better than the fixed-line infrastructure, and in

European countries, where mobile phone penetration is very high (at least 80% of consumers

use a mobile phone), mobile banking is likely to appeal even more.

1.5.3 Mobile Banking Services
http://en.wikipedia.org/w/index.php?title=Celent&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Celent&action=edit&redlink=1


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Mobile banking can offer services such as the following:

a.) Account Information

1. Mini-statements and checking of account history

2. Alerts on account activity or passing of set thresholds

3. Monitoring of term deposits

4. Access to loan statements

5. Access to card statements

6. Mutual funds / equity statements

7. Insurance policy management

8. Pension plan management

9. Status on cheque, stop payment on cheque

10. Ordering cheque books

11. Balance checking in the account

12. Recent transactions

13. Due date of payment (functionality for stop, change and deleting of payments)

14. PIN provision, Change of PIN and reminder over the Internet

15. Blocking of (lost, stolen) cards

b.) Payments, Deposits, Withdrawals, and Transfers

1. Domestic and international fund transfers

2. Micro-payment handling

3. Mobile recharging

4. Commercial payment processing

5. Bill payment processing

6. Peer to Peer payments

7. Withdrawal at banking agent

8. Deposit at banking agent


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A specific sequence of SMS messages will enable the system to verify if the client has sufficient

funds in his or her wallet and authorize a deposit or withdrawal transaction at the agent. When

depositing money, the merchant receives cash and the system credits the client's bank account or

mobile wallet. In the same way the client can also withdraw money at the merchant: through

exchanging sms to provide authorization, the merchant hands the client cash and debits the

merchant's account.

c.)Investments

1. Portfolio management services

2. Real-time stock quotes

3. Personalized alerts and notifications on security prices

d.) Others

1. Status of requests for credit, including mortgage approval, and insurance coverage.

2. Check (cheque) book and card requests.

3. Exchange of data messages and email, including complaint submission and tracking.

4. ATM Location.

1.5.4 Process of mobile banking services

The process of mobile banking is of XMS Mobile Banking Solutions which provide mobile

banking setup to various banks in different country is shown in appendix 2.


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Chapter 2

Review of Literature2.1 Excerpts from related Literature



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2.3 Rationale of Study

2.1 Excerpts from related Literature

Jonathan Donner (2008) This paper calls attention to this gap in the research Literature,

emphasizing the need for research focusing on the context(s) of m-banking/mpayments use.

Presenting illustrative data from exploratory work with small enterprises in urban India, it

argues that contextual research is a critical input to effective adoption or impact Research.

The paper identifies three crosscutting themes from the broader literatureamplification vs.

change, simultaneous causality, and a multidimensional definition of trusteach of which can

offer increased theoretical clarity to future research on m-banking/m-payments systems.

Rajnish Tiwari, Stephan Buse (January 2006) an empirical survey ofcustomer acceptance

conducted within the frame of our research clearly reveals a major, growing interest in Mobile

Banking. However, since the degree of interest and the willingness to pay vary for individual

services, it seems to be necessary to design specific services taking the needs and wishes ofrelevant target groups into consideration. Banks ought to therefore employ mobile channels with

a clear business-focus. This paper examines the opportunities for banks to generate revenues by

offering value-added, Innovative mobile financial services while retaining and even extending

their base of technology-savvy customers.


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Rasheda Sultana(2009) A study states the biggest share of mobile payment users will be in the

Asia/Pacific region by 2012(Gartner, 2008). In the context of being the most promising ICT

market and the largest inbound remittance receiver2, this region is expected to be the hub of m-

banking transactions. The paper starts with an overview of existing models of m-banking and

then examines the m-banking regulations in some South Asian.

Michael Klein, Colin Mayer (2011) Mobile banking is growing at a remarkable speed around

the world. In the process it is creating considerable uncertainty about the appropriate regulatory

response to this newly emerging service. This paper sets out a framework for considering the

design of regulation of mobile banking. Since it lies at the interface between financial services

and telecoms, mobile banking also raises competition policy and interoperability issues that are

discussed in the paper.

F.I. Anyasi and P.A. Otubu (August 29, 2009) This paper outlined vividly the use of mobile

phone in the banking industry, its economic implications, and in general a systematic look into

the various forms of mobile banking with emphasis on the security measures that makes

the whole process safe for adoption. The emergence of mobile banking technology systems

has implications for the general discussions about mobile telephony in the developing world.

Existing theory about the significance of mobile communications in the developing world has

focused on voice and text messaging. More so, the emergence of mobile banking also

underscores how, occasionally, innovations emerge from unexpected places and have the

capability of reconfiguring the significance of a technology to its users, offering a way to lower

the costs of moving money from place to place and opening a way to bring more users into

contact with formal financial systems.

Supathanish Termsnguanwong (2010) in a modernization epoch, strategic marketingmanagement and marketing information technology plays a major role in shaping industries all

over the world. Apparently, banks depend on information technology in conducting their

businesses and spend huge amounts of money on such technology to reduce operation costs and

gain competitive advantage over their rivals by offering customers better services through ATMs

machines, telephone banking internet banking and more obviously in the last decade the mobile


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banking. This study have found that a significant number of customers are either not

aware of the mobile banking services or do not trust the mobile banking as a channel to

conduct their banking transactions, and have found that customers may adapt the mobile

banking technology only if they perceive the technology to be useful. This research paper

examines customers' discernment of using mobile banking in Northern Region of Thailand. The

paper can be a very useful reference for the banking industry to improve the level of mobile

banking services

R. K. Uppal (6 January, 2010) In present day banking, total automation of banking operations is

an imperative need for all banks to attract more customers, provide efficient services, and

survive in the emerging new competition, apart from the profit motive which is the primary

objective of the business. In order to achieve these goals of business, various channels have

been developed through technology. Mobile banking is one of the best alternative channels

available to customers for quick, correct and efficient service at anytime and anywhere.

The present paper is devoted to explore the extent of mobile banking in Indian banking industry

where cell phone users are increasing at unexpected rate. Time period taken for study is 2000 -

2001 to 2006 - 2007 because this period is the eye-witness of infant condition of IT and during

the same period IT became mature. Simple statistical tools like average, standard deviation, co-

efficient of variation are used to calculate the efficiency of various bank groups providing the

service of M-banking. On the basis of analysis, the paper concludes that the private sector banks

are on the top in providing the M-banking services to their customers and have high profitability

as compared to other bank groups under study except foreign banks. The paper also highlightsthe benefits of M-banking to customers as well as to bankers and suggests some strategies

with their possible solutions like to spread awareness regarding M-banking and to increase its

area and scope to enhance M-banking services in India, particularly in rural and semi-urban

areas.


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Indrani Medhi, Aishwarya Ratan, Kentaro Toyama(2009) Due to the increasing penetration of

mobile phones even in poor communities, mobile-phone-enabled banking (m-banking) services

are being increasingly targeted at the unbanked to bring formal financial services to the poor.

Research in understanding actual usage and adoption by this target population, though, is sparse.

There appear to be a number of issues which prevent low-income, low-literate populations from

meaningfully adopting and using existing m-banking services.

This paper examines variations across countries in adoption and usage of existing m-banking

services by low-literate, low-income individuals and possible factors responsible for the

same. It is observed that variations are along several parameters: household type, services

adopted, pace of uptake, frequency of usage, and ease of use. Each of these observations is

followed by a set of explanatory factors that mediate adoption and usage.


While keeping below points in the consideration, this research has been done.

i. What will be the preference of the customer toward the mobile banking

services.

ii. What is the process of mobile banking services.

iii. What are advantages of mobile banking services.

iv. What are different services which can be use by mobile banking.

2.3 Rationale of study

Information technology and mobile has brought vast change in the working of banks. They have

made work more easy made time saving then the traditional banking. In Indore also many

nationalized and private bank such as SBI, ICICI, ING are providing mobile banking services.

A Research on mobile banking is being prepared in attempts to interpret in-depth study of

concept of banking services in Indore. This research will help us to understand various

terminologies in the mobile banking services. This research will suggest the alternatives of


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banking services in the Indore city and preference of customer towards traditional banking

services and mobile banking services

Chapter 3Research Methodology


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3.1 Objectives

3.2 Research Design

3.3 Type of Research Study

3.4 Sample Size3.5 Tools used for Data Collection

3.6 Tools used for Data Analysis

3.1 OBJECTIVES OF RESEARCH

3.1.1 Primary objective

Main objective is to study the-

The Preference of customer toward traditional baking services and mobile banking

services in Indore region

3.1.2 Secondary objective

a) To understand the advantage of mobile banking

b) To analyze the working and process of mobile banking

c) To analyze how the mobile banking is different from traditional banking

d) To known Customers preference toward mobile banking services then the traditional

banking services.


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3.2 Research Design

- The objective of the problem to be studied.

- The nature of the problem to be studied.

- The availability of time and money for the research work.

- The skills of the researcher.

3.3 Type of research study

Under this research descriptive research study is used.

3.4 Sample size-

100 for primary data

3.5Tools used forData collection

3.5.1 Primary source - Primary Data is collected with the help of research tool like

questionnaires from the individuals and consumers.

3.5.2 Secondary source - Secondary data is collected from the various bank and financial

institution magazines, journals, and books which are related to mobile banking.Sampling will be simple random sampling

3.6Tools use for data analysis-

Graphs, Charts, bar chats, Pie charts, Percentage Analysis


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Chapter 4Data Analysis

andInterpretation


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4 Data Analysis and Interpretation

1. Do you have a bank account?

Yes 100

No 0

Tab-4.1

Target Respondents


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Graph -4.1

Interpretation:

The data was collected from those respondents who has there bank account or customers of

different banks of Indore city because such respondent only can tell about there preference

among the traditional banking services and mobile banking services. The respondents where

having bank accounts in nationalized banks, private banks and co operative banks.

2. Did you known about mobile banking services?

Tab-4.2

Yes 91%

No 9%

Awareness of Mobile Banking


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Graph 4.2

Interpretation:

The above bar graph shows that most of the people of Indore city know about the mobile

banking services. We can also say that banks of Indore city have successfully given theinformation about mobile banking services through advertisement of various schemes so that

91% of respondents were aware about the mobile banking services.

3. Did your bank provide mobile banking services?

Yes 91%

No 9%

Tab-4.3


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Graph-4.3

Interpretations:

For this question the 91% of the respondents bank are providing the mobile bank services.

Which also tell us that most of the banks are providing mobile banking services or cutomers are

looking for such bank which provide mobile banking services and with the refrence of question

no. 2 results. we can also say that customer of banks which provide mobile banking services has

knowledge of mobile banking services and other cutomers whose banks does not provide mobile

banking services dont have knowledge of mobile banking services.

Availability of Mobile Banking Services


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4. Did you have GPRS/3G support mobile phone?

Tab-4.4

Graph-4.4

Yes 75%

No 25%

Availability of instrument/ medium


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Interpretations:

To use mobile banking services person should have GPRS/ 3G suppotrs mobile phone, they

enable mobile phone to use internet and banking application from the mobile. It was found that

75% of respondets were having such kind of mobile phones. So accordingy to todays situation

only 75% of pepole can only use the mobile banking services and if customer want to use the

mobile banking services then they have to turn to GPRS/ 3G mobile phone otherwise they will

only gets updates and alerts message on the name of mobile banking services.

5. Are you looking to use mobile banking services in future?

Tab-4.5

Yes 89%

No 11%

Future scope of mobile banking services


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Graph-5

Interpretations:

While doing survey it was found that 89% respondets are looking to use the mobile banking

services in future. Which also shows that in future use of mobile banking services can be

increase. and 11% of respondents dont want to use mobile banking services in future reason

may be be because of not available of proper facility or lack of knowledge.

6. Did you get mobile SMS updates and alerts from your bank?

Tab-4.6

Yes 89%

No 11%

Facility from bank to customer


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Graph-4.6

Interpretation:


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As per survey it was found that 87% of respondents get the mobile SMS updates and alerts

from their bank. And 13% of respondents do not receive any SMS from their banks. This means

that banks of Indore city also looking to provide fast services like balance enquiry without goingto bank or ATM and to increase use of mobile banking services by the customers.

7. Did you have browse internet banking from your mobile phone?

Tab-4.7

Yes 55%

No 45%

Usage of Mobile Banking


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Graph-4.7

Interpretation:

55% of respondents has use internet banking or has done banking through internet it may be for

balance enquiry, online trading etc. and 45% of the respondents has not use internet banking it

may be because of lack of infrastructure and lack of knowledge. It is possibility that respondent

which are using internet banking services may also use the mobile banking services.

8. Do you feel more convenience to use mobile banking services then the traditionalbanking services?

Yes 80%

No 20%

Tab-4.8

Convenience to use technology


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Graph-4.8

Interpretation:


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80% of respondents feel that its convenience to use mobile banking service than the traditional

banking services, as mobile banking services save time and travelling cost of the customer. On

other hand 20% do not feel mobile banking services convenience than the traditional banking

services. It may be because of lack of mobile banking knowledge.

9. Is security is the factor for using traditional banking?

Yes 80%

No 20%

Tab-4.9

Security factor in Mobile Banking


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Graph-4.9

Interpretation:

While survey it was found that 61% of the respondents feel security is the reason for not using

mobile banking servicesas compare to traditional banking services. Respondent feel that their

money may not be in safe hand while using mobile banking services. On other hand 39% do not

agree with this point.

10. How frequently do you visit your bank branch per month?

Tab-4.10

Never 1 to 4 times 5 to 8 times 9 to 12 times over 12 times

Respondent 20% 57% 15% 3% 5%

Usage of Traditional Banking


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Graph-4.10


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Interpretation:

The survey shows that 20%of respondents never visit their bank. 57% respondents visit their

bank one to four times, 15% of respondents visit their bank five to eight times, only 3% of

respondents visit bank nine to twelve times and only 5% of respondents visit their bank more

than twelve times. Which also shows that 80 % of the respondent have to visit bank for several

activates or for traditional banking services.

11. What is the main reason that you typically visit your bank branch (please choose the

single most important reason)

Make a

deposit

Investment

advice

Balance

inquiry

Cash

withdrawal

Other

Respondent 57% 6% 5% 10% 22%

Tab-4.11

Service mostly use in Traditional Banking Services


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Graph-4.11

Interpretation:

The main reason to visit the bank is to deposit money in the bank has been found during the

survey.57%of the respondents visit bank for this reason. This proves that other activities of the

bank like balance inquiry, cash withdrawal outside the bank branch it may possible by mobile

banking services, ATM and net banking. And other 22%of respondent visit bank for other reason

which can be for building healthy relations with bank, use of locker facility etc. on other hand

5% and 10% respondents like to visit bank for balance inquiry and withdrawal of money

respectively.

12. How frequently do you use telephone banking services per month (for example,

balance Inquiry, fund transfer between accounts)?


Respondent 46% 40% 7% 4% 3%

Tab-4.12

Telephonic use in Banking by respondents


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Graph-4.12

Interpretation:


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It was found that 46% of the respondents dont use the facility of telephonic banking services.

Which also show that respondents do not like telephonic services. And 40 % of respondents use

he telephonic services for 1 to 4 times in month it may be for the general inquiry with the bank

representative.

13. How frequently do you use an Automated Teller Machine (ATM) per month?


Respondent 6% 32% 22% 13% 27%

Tab-4.13

Use of ATM by respondents


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Graph-4.13

Interpretation:

It was found that 94% of the respondents use the Automated Teller Machine (ATM) to

withdrawal of money. It may be because that not only in Indore city but in whole county person

requires the hard cash for trading in local market. Only 6% of respondent do no use the ATM.

14. Approximately how many times have you purchased any product through the Internet in

the last 12 months?



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Respondent 55% 36% 9% 0% 0%

Tab-4.14

Graph-4.14

Interpretation:

The result of above question state that the user of doing internet trading or purchasing product

through internet banking is less than the non user of online trading or purchasing. 55% of

Use of internet banking by respondents


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responded has never purchase product through internet. And 45% of the respondents have

purchase the product through internet.

15. Approximately how many times have you purchased any product through the mobile

banking in the last 12 months?


Respondent 77% 19% 3% 1% 0%

Tab-4.15

Use of mobile banking for trading and shopping


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Graph-4.15

Interpretation:

The above chart shows that many of the respondents have not use the mobile banking to

purchase the product. 77% respondent has never used the mobile banking to purchase the

product only 33 % has use to purchase the product by mobile banking. This means that

respondents are only use mobile banking services for the services like balance inquiry and SMS

alerts.

Chapter 5

Findingsand


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Discussion

5.1 Findings

In my research study I came to know about the following points.

1. Awareness of Mobile Banking

People of Indore are well aware about the mobile banking services 91% of the people

known about the mobile banking services and only 9% dont know about the mobile

banking services.

2. Availability of Mobile banking services

From the targeted respondents bank 91% banks provide mobile banking services and

only 9% of the banks are not providing mobile banking services


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3. Availability of instrument/ medium

There were 75% of the people which use mobile which support the function of mobile

banking services. 25% of the people dont have such kind of phones.

4. Future scope of mobile banking services

89% of the respondents have shown positive attitude toward using of mobile banking

services and 11% of the respondents may not be using mobile banking services in future.

5. Facility from bank to customer

87% of the respondents bank provides the primary mobile banking services and 13% of

the respondents bank does not provide primarymobile banking services.

6. Convenience to use technology

80% of the respondents know to use the mobile banking services and 20% of the

respondents and 20% of the respondents dont know how to use mobile banking

services.

7. Security factor in Mobile Banking

Security factor is considered by the 61% of the respondents and 39% of the respondents

does not consider it.

5.2 Discussion


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This research report is on topic A comprehensive study of customers preferences towards

traditional banking services and mobile Banking Services, in Indore region. Under this research

descriptive research study is used. This research study shows the factor influencing customer

preference towards banking services.To explore the opportunities and challenges present for

banking sector. A Research on mobile banking is being prepared in attempts to interpret in-depth

study of concept of banking services in Indore. This research has helped us to understand

various terminologies in the mobile banking services. The research also goes under to know the

process, function and products of the mobile banking services. This research has suggested the

alternatives of banking services in the Indore city and preference of customer towards traditional

banking services and mobile banking services.

The preference of the customer was analyzed by the primary data which was collected byconducting survey, where questionnaire was filled by the hundred respondents. The target

respondents are the customers of the banks in Indore. Which include the professionals, business

men and students of Indore city. The data was analyzed through bar graphs and pie charts.

The result of research is that the public of Indore city has adopted the mobile banking services

for the primary use of banking services such as balance inquiry, cheque clearance report etc. the

customers has not adopted all facilities which is provided by the mobile banks such as transfer

of fund, purchase of products etc.

There are many banks in Indore city which include nationalized, private and co-operative banks.

With the change and upgrade in the technology in the country the banks has also match their

technology with current trend. This includes the facility of mobile banking services too.

The mobile or cell phone has become very important gadget in the life of people of Indore city.

The mobile phone has been used for the various other than communication such as for social

networking site, Emails and banking also.

In Indore city many banks are providing mobile banking services and they are looking as the

most emerging technology in the banking sector. Every bank which is providing the mobile

banking services are spending lots of money in the advertising of the mobile banking services.

We can see lots of television advertisement, outdoor advertisement in the Indore city. And the


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result is that most of the prospect customers are well known about the mobile banking services.

Whenever person goes to bank to open a new bank account with the cheque book, ATM card,

Pass book customers also get the id to us the mobile banking services. The use of mobile

banking will helps bank to reduce the cost like cost infrastructure, paper work cost etc.

The busy schedule of the public of Indore city, the use of mobile banking services is increasing

day by day. People are not only having time to visit bank but they also dont have time to login

there account on their net banking account in PC and laptops. Mobile banking services also

proved as the very economy services as compare to internet bank services. As internet banking

require internet connection. It is costly then the cost of SMS of mobile phone. And few services

are provided free in mobile banking services such as message alert for the balance inquiry,

payment clearance and deposits information. The customer has shown the positive attitude orperception towards the mobile banking services


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Chapter 6Conclusion

andSuggestions


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6.1 Conclusion

While doing the research it was found that there is a need for providing better and cost-efficient

banking services to masses. The mobile phone has emerged as a medium for solving this

problem. There exists not much difference in the basic mobile banking services offered by

various banks. A careful analysis of the mobile phone application of the various banks revealed

that the design of the process, technological up gradation, security features, consumer

friendliness, and value-added services varies from bank to bank. There is a lot of emphasis on

the concern for security by all the banks. They have taken steps to educate the customers

regarding security.

The customers look for ease in performing banking transactions along with more and updated

information when adopting mobile banking services. Those banks whose policies and websites

are complex will face a setback. Customers do not use all services equally.

The users weight different reasons before choosing a particular mobile banking service. Users of

mobile banking give more importance to traditional bank account for depositing the money in

the bank. Lack of time is one of the prime reasons for using mobile banking services.

There is a greater concern for security among the non-users and need to introduce such security

measures which are valued more by the customers, such as high security password on mobile,

tips on the website, and automatic lock out on multiple incorrect password entry. There is a need

to assuage the concern for security among non-users by increasing the strength and number of

security features offered by the banks.


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6.2 Suggestions

People should grab the new opportunity in the banking services. It will help people to

save their time and will make banking easy for them.

Customer or people should ask to their bank about the uses and methodology to use the

mobile banking services.

People of Indore city should be more computer and mobile literate to use the mobile

banking services.

People should have GPRS or 3G support mobile to use Mobile banking services.

People have to understand that mobile is not only for the communication purpose but

mobile is the multipurpose device and mobile banking services are the one of the feature

of the mobile.

Banks should run the campaign to make people aware more about mobile banking

services and make their customer mobile banking literate.


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Banks have to make mobile banking services process more effective and safe so that

customer feel confidence while using mobile banking services.

Banks should add feature like withdrawal ATM address which will help us customer to

locate their ATM card if they have lost or if their ATM card is stolen.

Chapter 7


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Implementation

ofStudy

7.1 Limitation of the research7.2 Direction of future research

7.1 Limitation of the research

Due to limitation of time and cost constrains a sample size of respondents in only 100.

Data Analysis and interpretation done may not be that strong due to small sample and

Convenience Sampling Method.

The sample extent for research is only Indore City.

Some of the respondents may be biased in giving responses.

My inexperience in research area might have affected results.


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The figure use in the research is the present data and it can be changed with time.

7.2 Direction of future resea rch:-

This research will help to banks as well as customers also. In respect of banks they can improve

their mobile banking services more efficiently. So that they can avail more customers for mobile

banking and in respect of customers internet facilities offered by banks and usage of internet

facilities.


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The research is limited to Indore region. It can be further expanded to state level.

Only 100 samples were used in this research. The sample size can be increased to at least

500 samples for more accurate and generalized result.

The research related to scope of mobile banking adoption in Indore city can use for future

purpose. Since internet mobile is demanding among customers so that they can fulfill their

immediate requirement for any legitimate purpose, so a scope of mobile banking is necessary so

that can choose their facilities as according to their purpose and requirement


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Chapter 8References


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References

1. Customers' discernment of mobile banking business by Supathanish

Termsnguanwong, DBA, 2010

2. New Research Reveals Untapped Market for Mobile Banking Among Offline

Consumers, Syniverse Technologies, 2009

3. Mobile Banking and Financial Inclusion, Michael Klein, Colin Mayer, May 2011

4. Mobile-Banking Adoption and Usage by Low-Literate, Low-Income Users in the

Developing World, Indrani Medhi, Aishwarya Ratan, Kentaro Toyama. 2009

5. Mobile Banking Notifications and Transactions, Eric Lim , Anurana Saluja(Nov 2005)

6. Emerging issues and strategies to enhance M-banking services, R. K. Uppal, (Feb

2010)

7. Mobile banking and economic development: Linking adoption, impact, and use,

Jonathan Donner (2008)

8. Mobile banking: Overview of Regulatory framework in emerging markets, RashedaSultana (2009)

9. Mobile Banking As Business Strategy: Impact Of Mobile Technologies On CustomerBehaviour And Its Implications For Banks, Rajnish Tiwari, Stephan Buse, Cornelius

Herstatt (January 2006)

10. Mobile Banking For Inclusive Growth, Pratima Trivedi (March 2010)

11. Mobile Phone Technology in Banking System: Its Economic Effect F.I. Anyasi andP.A. Otubu (August 2009)

12. Innovations in Bank by Katuri Nageswara Rao

13. Telecom Technologies emerging trends by Ravi Kumar Jain B

14. IT @ Financial Services Banking Industry by Satish D

15. www.rbi.org.in


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16. www.mobile.prepaidsbi.com

17. www.icicibank.com/Personal-Banking/onlineservice/mobile-banking/mobile.htm

18. www.hdfcbank.com/.../mobilebanking/mobilebanking_faqs.htm

19. www.wikipedia.org

20. www.indusind.com/indusind/wcms/en/home/.../mobile-banking

21. www.india-cellular.com/Lets-Learn/Mobile-Banking.html

22. www.bankingtech.com/bankingtech.htm

23. www.mobilepaymentsworld.com

24. www.mbanking.blogspot.com

25. www.telecompaper.com/background/mobile-banking


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Chapter 9Annexure

9.1 Appendix 1: Table 1

9.2 Appendix 2: Diagram 1

9.3 Appendix 3: Questionnaire


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APPENDIX

9.1 Appendix 1

The following table shows the data of India bank failed between 1913 and 1918.

YearsNumber of banks

that failed

Authorized capital

(Rs. Lakhs)

Paid-up Capital

(Rs. Lakhs)

1913 12 274 35

1914 42 710 109

1915 11 56 5

1916 13 231 4

1917 9 76 25

1918 7 209 1

Tab-9.1

Failure bank list


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9.2 APPENDIX 2

The following is the process of mobile banking is of XMS Mobile Banking Solutions which

provide mobile banking setup to various banks in different country.

Pic-10.2

Mobile Banking Process


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9.3 APPENDIX 3

Questionnaire

Dear Respondent,

We assure you that all the information that will be collected from you will remain fully

confidential and it is used for study purpose only. Please mark ( ) the answer according

to your opinion.

1. Do you have a bank account?

Yes No

2. Did you known about mobile banking services?

Yes No

3. Did your bank provide mobile banking services?


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Yes No

4. Did you have GPRS/3G support mobile phone?

Yes No

5. Are you looking to use mobile banking services in future?

Yes No

6. Did you get mobile SMS updates and alerts from your bank?

Yes No

7. Did you have browse internet banking from your mobile phone?

Yes No

8. Do you feel more convenience to use mobile banking services then the traditionalbanking services

Yes No

9. Is security is the factor for using traditional banking?

Yes No


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10. How frequently do you visit your bank branch per month?


11. What is the main reason that you typically visit your bank branch (please choose the

single most important reason)

Make a deposit Investment advice Balance inquiry

Cash Withdrawal Other

12. How frequently do you use telephone banking services per month (for example, balance

Inquiry, fund transfer between accounts)?


13. How frequently do you use an Automated Teller Machine (ATM) per month?


14. Approximately how many times have you purchased any product through the Internet in

the last 12 months?


15. Approximately how many times have you purchased any product through the mobilebanking in the last 12 months?


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Name:

Age:

Occupation:

Thank you

Documents

MRP Ankit Kanugo Updated 14-9-11 Final