International Journal of Economics, Finance and Management Sciences

2019; 7(6): 178-186

http://www.sciencepublishinggroup.com/j/ijefm
doi: 10.11648/j.ijefm.20190706.11
ISSN: 2326-9553 (Print); ISSN: 2326-9561 (Online)

Customers’ Trust on E-Banking System in Bangladesh

Mohammad Shamsus Sadekin1, Shamima Nasrin Mukta1, Md. Abdul Hannan Shaikh2
1
Department of Humanities, Chittagong University of Engineering & Technology, Chittagong, Bangladesh
2
Department of Management, Islamic University, Kushtia, Bangladesh

Email address:

To cite this article:

Mohammad Shamsus Sadekin, Shamima Nasrin Mukta, Md. Abdul Hannan Shaikh. Customers’ Trust on E-Banking System in Bangladesh.
International Journal of Economics, Finance and Management Sciences. Vol. 7, No. 6, 2019, pp. 178-186.
doi: 10.11648/j.ijefm.20190706.11

Received: October 16, 2019; Accepted: October 23, 2019; Published: October 30, 2019

Abstract: E-banking is the newest improvement in banking sector which is a latest dimension to banking dealings by
permitting customers to perform financial transaction through the delivery channel. The study was designed to investigate
practices, impact, security, problems and prospects of e-banking in Bangladesh which are directly related with the trust on
electronic banking. To collect data for this study a set of questionnaire was developed with 44 questions which covered the
above mentioned elements of e-banking in Bangladesh. Total 224 respondents are selected purposively from bankers and
customers of whom 75 bankers and 149 are bank customers of sixteen randomly selected banks. Banks are classified into four
categories like state owned commercial bank, domestic private commercial bank, foreign commercial bank and other
specialized bank which activates in Bangladesh. Statistical software SPSS was used to analyze data. The result shows that
customers trust depends basically on security measures, customers awareness, educational qualification, authentication of e-
transaction, e-service quality of banks, bankers behavior etc. Every step in the online banking activities is secured by one or
more security mechanisms. Customer’s awareness is one of the most important elements to build up trust on e-banking. Low
educated people are afraid of doing e-banking operation. Problems or difficulties are directly related with customers trust. If
customers trust is reduced if they face difficulties to do an e-transaction.

Keywords: E-banking, Problems, Security, Trust

electronic means, i.e. using telecommunications network,

1. Introduction web technology, computers, cellular phones and other
E-banking is a new banking system which has been added electronic devices [1]. Now a day’s due to emerging global
in last decade in Bangladesh. Till now majority Bangladeshi economy, e-commerce, and e-business have increasingly
customers are not habituated in e-banking system. E-banking become a necessary component of business strategy and a
advancement of any country mostly depends on customers’ strong catalyst for economic development. The new
trust on this system. Customers’ trust in e-banking system of information technology is becoming an important factor in
any bank is depend on some criteria like; service quality, the future development of financial services industry, and
security, speedy network customers’ educational qualification especially banking industry. As a third-world developing
etc. Customers’ trust on e-banking system will be increased if country, Bangladesh is far behind to reach the system [2]. E-
e-service quality of any bank is better than traditional banking facilities not only make banking activities faster but
banking system due to customers’ satisfaction. Customers’ also provide different online services like Internet Banking,
satisfaction on e-banking system is depends on service above ATM, POS, terminals which helps people to get banking
mentioned terms of banking transactions. If Bangladeshi facility in a faster way. Although e-banking swindle in large
banks will fail to increase customers’ trust on this banking scale in the country and central bank of Bangladesh needs to
transactions its future will be very dark. This research tried to take all the necessary measures to prevent it. This can be
find out trust of Bangladeshi customers on e-banking system. done through proper education on information technology
E-banking is the banking activities performed through the and sufficient software & hardware support [3]. Customers
think that e-banking services were relatively good than
179 Mohammad Shamsus Sadekin et al.: Customers’ Trust on E-Banking System in Bangladesh

manual system, but they not satisfied with the quality of Trust on e-banking depends on some factors like; security
services and bank personnel’s’ behavior to that extent. E- system, service quality, simplicity of e-transactions, internet
banking serves several advantages to Bangladeshi banking facilities and its speed quality, and prospects of e-banking
sector, however, this study also observed that the customers of system etc. The following research works have been
DBBL have not enough knowledge regarding e-banking which concentrated on these terms of e-banking. One of the electronic
is rendering by banking sector in Bangladesh [5]. E-banking services which are gaining more popularity and attention is e-
provides convenience and flexible advantages. It also provides banking. The consideration given to the e-banking by the current
transaction related benefits like easy transfer, speedy transaction, traditional banking customers may be due to the changes in the
less cost and time saving [6]. Although e-banking concept is banking consumers’ lifestyle, and this lifestyle have become
new in Bangladesh but its potentiality is high [7]. Users’ compatible to the new way of conducting banking services
perceived ease of use failed to predict the customers’ intention to online. Trust and security are among the central factors that
use online banking services [8]. The advancement of e-banking influence banking customers’ acceptance of the service [8].
depends on customers trust on this system. Security status of e- Demographic factors impact significantly internet banking
banking and customers trust on it are directly related with one behavior, specifically, occupation and instruction. the perceived
another. The development of the concept of electronic financial convenience, perceived risk, perceived security and prior
services, more commonly known as e-banking. At present, internet knowledge all have significant effects on behavioral
private & public banks of Bangladesh have taken various steps intention to use online banking among ‘early adopters’,
in E-banking [9]. Consumers are attracted to e-banking convenience was a more important indicator of intentions to
technologies because of convenience, increasing ease of use, and adopt internet banking. Risk, security and prior internet
in some instances cost savings [18]. knowledge is also an important factor influencing customers
adopting internet banking after convenience. Among
2. Methodology of the Study demographic variables, further significant influences have been
found for instruction and occupation [10]. Information
This study has been done based on primary data. Data has technology is becoming an important factor in the future
been collected from 16 selected banks in Bangladesh. To development of financial services industry, especially the
collect data for this study a set of questionnaire was banking industry. The banking sector is based on sharing of
developed with 44 questions which covered e-banking information, which itself heavily relies on information and
practice in Bangladesh, it security, problems and prospects. communication technology (ICT) in order to acquire, analyze
Total 224 respondents were selected purposively from and deliver data to all relevant users. The ICT is crucial not only
bankers and customers. Out of the respondents 75 are for information analysis, but also enables the banking sector to
bankers and 149 are bank customers of sixteen randomly differentiate its offer from competitors and thereby make it a
selected banks. Banks are classified into four categories like market leader. In this context, banking sector are obliged to
state owned commercial bank, domestic private commercial continuously innovate and update their marketing strategies in
bank, foreign commercial bank and other specialized bank order to closely meet the demands and the requirements of the
which activates in Bangladesh. Statistical software SPSS was individual customers. It also provides safe and confidential
used to analyze data. Sample were selected from State services which best suit customers’ needs. The customer wants
Owned commercial banks, domestic private commercial more flexibility without paying more, and his demands are clear:
banks and foreign commercial banks in Bangladesh and bank Make transactions wherever, whenever, and however he wants
customers were selected from branches in different territory [9]. Electronic banking offers numerous benefits to SMEs.
like Dhaka, Chittagong, Rajshahi, Khulna and Rangpor SMEs can check account balances, transfer money, pay bills,
division. Responds were collected from university, college collect receivables and ultimately reduce transaction costs and
and school teachers and students, businessmen and other establish greater control over bank accounts [11]. Bank could
professionals from private and public sectors. Information increase internet banking adoption by making their customers
was collected from the branch of rural areas and different awareness about the usefulness of the service. The variable
towns Bangladesh. A set of questionnaire was designed and perceived usefulness has a positive influence on internet banking
was sent to the respondents through e-mail. Secondary data use, therefore internet banking acceptance would increase when
was also used for this study Secondary data has been customers find it more usefulness. Bank should plan their
collected from the website of different banks. The collected marketing campaigns taking into consideration this factor [12].
information’ have been analyzed by SPSS. Mainly four factors are significant with respect to the e-banking
practices. Privacy & convenience, content & website layout,
3. Literature Review speed of delivery, and accessibility are the critical factors
influencing the e-banking practices [13]. The development of
A number of research studies have been conducted on Internet Banking (I-Banking) requires a new recognition of
adoption, practice, impact and securities of e-banking in customers’ values for building long-term organization-customer
home and abroad. Some of the relevant studies reviewed and relationships in the E-era. Value was the most critical factor
presented below in accordance to year (present to previous) impacting customers’ trust in I-Banking, compared with two
of publication: other important factors; communication and opportunistic
 International Journal of Economics, Finance and Management Sciences 2019; 7(6): 178-186 180

behavior control. The shared value was the most critical factor data collected for the study. The study has been conducted
impacting customers’ trust in I-Banking. As regarding improving mainly based on primary data. Secondary data has also been
loyalty among I-Bank customers, findings suggest that I- used for this work. Total 224 respondents are selected from
Banking needs to take satisfaction, trust, brand reputation and bankers and customers. Out of 224 respondents 75 are bankers
switching cost seriously, especially satisfaction, because it is the and 149 are bank customers of sixteen randomly selected
most important factor that influences customers’ loyalty [14]. banks. Bankers provide their opinion as an account holder of
The squire of correlation coefficient of number of ATM, the related bank. Data for this study has been collected from 16
recoveries from clients, number of branches, income from IT, banks. Out of 16; 03 banks are state owned commercial banks
card expenses, cash carrying charge, depreciation on computer (Sonali Bank Ltd., Agroni Bank Ltd and Rupali Bank Ltd.), 08
equipment and software, other operating expenses, net income domestic private commercial banks ( Islami Bank Bangladesh
and EPS is more than 0.5. It indicates the prospect of e-banking Ltd., Datch-Bangla Bank Ltd., Eastern Bank Ltd., BRAC Bank
in Bangladesh is very bright [3]. The factor that is necessary for Ltd., First Security Islami Bank Ltd. Al-Arafah Islami Bank
trust building in all the examined countries differs: In Lithuania, Limited, Social Islami Bank Ltd. Bank Asia Ltd.) 03 foreign
information and the bank, in Latvia, the website, and in Estonia, commercial banks (Standard Chartered Bank Ltd., Citi Bank
the bank. According to the experts, the most powerful factor in Ltd, Bank Alfalah) and 02 specialized banks ( Grameen Bank,
the trust-building process in Lithuania and Latvia is the e- BASIC Bank) have been selected purposively. Respondents
banking system while in Estonia, the website. The research has have been selected from various branches of Dhaka,
the following limitations: The online survey of individual Chittagong, Rajshahi, Rangpur and Khulna Division and 224
customers (however, internet banking relates to internet users, so Samples were purposively selected from different categories of
this limitation is not essential); the analysis of only the positively bank customers like male and female, banker and bank
affecting criteria of the trust-building process; only experts customers, highly educated and low educated customers,
assessed the sub-factors [16]. Ease of use and usefulness; have different types of account holders, different professionals
been considered to be fundamental in determining the (service holder, teacher and business man, journalist and self
acceptance of various IS in the past decades. These beliefs may employed person). Bankers have been selected as an account
not, however, fully explain the users’ behavior in an emerging holder of related bank. For this study a set of questionnaire has
environment such as Internet banking. Trust is another belief been used to collect data which carried 44 questions. The
that has an impact on the acceptance of Internet banking. We questionnaire has covered e-banking practices in Bangladesh
collected 845 cases on the Web to survey users’ behavior and its impact on customers, it security, problems and
towards Internet banks. The results of statistical analyses using prospects which are closely related with customers trust of e-
structural equation modeling indicate that trust has a significant banking. Out of 44 questions 11 questions are related with e-
impact on the acceptance of Internet banking [17]. Trust on e- banking practice, 09 questions are related with the impact, 12
banking of any countries somewhat depends on prospects of e- questions are related with the security and remaining questions
banking of that countries. are related with problems and prospects of e-banking in
Bangladesh. Secondary data has been collected from banks’
4. Analysis and Findings web sites, different articles and news papers. Statistical
software SPSS was used to analyze the data collected from the
Followings are the presentation of the result and analysis of respondents.
Table 1. Type of Accounts and Educational Qualification of the Respondents.

Type of Online Account Total

Education Mobile Banking Credit Card ATM account Internet Banking Other N/A
No. (%)
No. (%) Account No. (%) No. (%) No. (%) No. (%) No. (%)
SSC 0 (0) 0 (0) 4 (50) 0 (0) 0 (0) 4 (50) 7 (3)
Bachelor Degree 26 (24) 9 (9) 28 (26) 13 (12) 0 (0) 32 (29) 108 (48)
Master Degree 7 (7) 2 (2) 52 (45) 11 (11) 9 (9) 28 (26) 108 (48)
Ph. D 2 (1) 0 (0) 0 (0) 0 (0) 0 (0) 0 (0) 1 (1)
Total 35 (16) 11 (5) 82 (35) 24 (11) 9 (4) 63 (28) 224 (100)

Table 1 shows that majority of the respondents (48%) use (48%). Lowest number of respondents (01%) is Ph.D.
online accounts are Bachelor Degree Holder. The next holders. Among the online accounts ATM account is used by
highest numbers of respondents use online accounts are majority (35%) of the respondents.
Master Degree Holder (48%) and Bachelor Degree Holder
Table 2. E-Service Quality of Different Types of Bank.

E-Service Quality of Different Types of Bank in Bangladesh

Types of Bank
Not Good No. (%) Satisfactory No. (%) Very Good No. (%) Excellent No. (%) Do not Know No. (%)
State Owned Commercial banks 23 (10.27) 71 (31.70) 65 (29) 62 (27.68) 3 (1.35)
Domestic Private Commercial Banks 18 (8.04) 30 (13.39) 83 (37.05) 92 (41.07) 1 (0.45)
Foreign Commercial Banks 02 (0.89) 15 (6.70) 65 (29.02) 118 (52.68) 24 (10.71%)
181 Mohammad Shamsus Sadekin et al.: Customers’ Trust on E-Banking System in Bangladesh

Table 2 shows that the highest percent of respondents excellent. Out of the respondents’ majority (31.70%)
(52.68%) mentioned e-service quality of foreign commercial mentioned that e-service quality of state owned commercial
banks and 41.07% of domestic private commercial banks are banks are not good.
Table 3. Security of E-Transaction in Different Types of Banks in Bangladesh.

Don't know Not secured at all Not enough secured Sufficient Secured Highly Secured
Types of Bank
No. (%) No. (%) No. (%) No. (%) No. (%)
State Owned Commercial Bank 13 (5.80) 0 (0) 53 (23.66) 86 (38.39) 72 (32.14)
Domestic Private Commercial Bank 26 (11.61) 21 (9.38) 78 (34.82) 66 (29.46) 33 (14.73)
Foreign Commercial Bank 42 (18.75) 0 (0) 2 (0.89) 19 (8.48) 161 (71.88)

It is evident from the table 3 that among the respondents private commercial banks are not enough secured. According
38.39% mentioned that e-banking security of state owned to 71.88% respondents’ e-banking function of foreign
commercial bank is sufficient secured, and 34.82% commercial banks are highly secured.
respondents mentioned that e-banking service of domestic
Table 4. Educational Qualification and Trust on E-Banking.

Trust on E-Banking Total

Educational Qualification
Less Than 25% Less Than 50% Less Than 75% Less Than 100% 100% Trust Total
SSC 04 (50%) 04 (50%) 00 (0%) 00 (0%) 00 (0%) 08
Bachelor Degree 17 (7.59%) 09 3.75% 24 (11.16%) 34 (15.18%) 23 (10%) 107
Masters Degree 9 (4.02%) 17 (7.59%) 25 (11.61%) 34 (15.18%) 22 (9.82% 107
Doctorate Degree 00 (0%) 00 (0%) 00 (0%) 00 (0%) 02 (100%) 02
Total 224

Table shows that 100% PhD degree holders have 100% trust on e-banking transaction and 100% SSC degree holders have
less than 50% trust on e-banking transactions in Bangladesh.

Table 5. Satisfaction of Customer and Their Trust on E-Banking.

Trust on E-Banking
Satisfaction Level Total
0%-25% Trust 25%-50% Trust 50%-75% Trust 75%-100% Trust
Fully Satisfied 13 (30.23%) 4 (9.30%) 9 (20.93%) 17 (39.54%) 43 (19.20%)
Highly Satisfied 22 (30.06%) 11 (18.03%) 17 (27.87%) 11 (18.03%) 61 (27.23%)
Sufficient Satisfied 6 (13.33%) 15 (33.33%) 17 (37.78%) 7 (15.56%) 45 (20.08%)
Not Enough Satisfied 11 (27.5%) 9 (22.5%) 11 (27.5%) 9 (22.5%) 40 (17.86%)
Dissatisfied 0 (00%) 6 (37.5%) 6 (37.5%) 4 (25%) 16 (7.14%)
Highly Dissatisfied 1 (5.26%) 8 (42.61%) 6 (31.58%) 4 (20.55%) 19 (8.49%)
Total 53 (23.66%) 58 (25.89%) 74 (33.04%) 39 (17.41%) 224

Table No. 5 shows that 19.20% respondents are fully 8.49% are highly dissatisfied on e-banking service and
satisfied on e-banking service and their trust (39.54%) is majority (42.61%) of them have minimum (25%-50%) trust
comparatively higher than others. Out of the respondents on e-banking.
Table 6. E-Services Provided by the Banks in Bangladesh.

Name of E- Services
Types of Bank ATM POS Credit Card Mobile Online Money Online Bill
Name of Bank CBS
Service Service Selrvice Banking Transfer Payment
State owned Sonali Bank Ltd. √ √ √ × √ √ √
Commercial Agroni Bank Ltd. √ √ × × √ × √
Banks Rupali bank Ltd. √ × √ √ √ × ×
Datch-Bangla Bank Ltd. √ √ √ √ √ √ √
Eastern Bank Ltd. √ √ √ × √ √ √
BRAC Bank Ltd. √ √ √ √ √ √ √
Domestic Private
Prime Bank Ltd. √ √ √ × √ √ √
Commercial
Jamuna Bank Ltd. √ × √ × √ √ √
Banks
Islami Bank Bangladesh Ltd. √ × √ × √ √ √
Pubali Bank Ltd. √ √ √ √ √ √ √
Al-Arafah Islami bank Ltd. √ √ √ × √ √ √
Standard Chartered Bank Ltd. √ √ √ √ √ √ √
Foreign Banks Citi Bank Ltd. √ √ √ √ √ √ √
Bank Al-Falah Ltd. √ √ √ √ √ √ √

Table 6 shows that almost all banks provide e-banking services but foreign commercial banks are in leading position.
 International Journal of Economics, Finance and Management Sciences 2019; 7(6): 178-186 182

Table 7. Special E-Services Offered by the Bank.

Types of Bank Name Of Bank Special Services

Electronic Banking: Dutch-Bangla Bank is the first bank in Bangladesh to be fully automated and introduce
Electronic Banking. DBBL client now has unrivaled access to banking from any DBBL branch, ATM and POS.
All of these services are free-of-charge and are surprisingly affordable for everyone.
Datch-Bangla Mobile Banking: DBBL pioneered Mobile Banking in Bangladesh. It was the first bank to offer banking facilities
Bank Ltd. through a wide range of mobile phones. SMS (Short Messaging System) is an extremely unsecure method to do
mobile banking. DBBL recommends you use a HTML browser found on many phones to access internet banking
facilities. To make the most unsecure scenario, DBBL issues a mobile PIN number which is different from the
DBBL pin number for mobile transactions.
Eastern Bank Ltd. EBL Fast Cash, EBL Cash Deposit Machine, EBL Kotipoti Scheme, EBL Power savings
Islami Bank ATM services, Internet Banking, Payment Gateway, Mobile Banking, Consumer Banking Corporate Banking
Bangladesh Ltd. Investment Banking
Domestic Private
Al-Arafah
Commercial Banks Agent Banking, Evening Banking, Ababil Software,
Islami bank Ltd.
Pubali Bank Ltd. PIBS, Evening banking in some branches. Charge free online banking
BRAC Bank Mobile Banking, B-cash, Internet Banking, 24-Hours Call Center, SMS Banking, Mobile Top-up, evening
BRAC Bank Ltd
banking, i-wallet service discounted, Important security message, Phishing Alert, Internet Banking User Manual.
One Stop Utility Services Scheme: To pay Electricity Bills, Cash deposit in his/her account at any branch of the
Prime Bank Ltd. Bank irrespective of location. Cash deposit in other's account at any branch of the Bank irrespective of location.
Transfer of money from his/her account with any branch of the Bank.
Non-Resident Bangladeshi (NRB) Banking: AB bank facilities offered to NRBs Opening of Foreign Currency
A/C: We open Foreign Currency Account in USD/GBP/EUR/JPY for NRBs. Foreign Currency can be remitted by
AB Bank Ltd.
the Nationals of Bangladesh living Abroad earned by them as wage earners or from other sources. The deposit
amount can also be used for remittance to other.
Types of Bank Name Of Bank Special Services
Employee Banking: Employee Banking proposition not only offers you a salary account but also comes with a perfect
value pack of Credit Card and Personal Loan. Other accounts are residents foreign currency deposit account and non-
resident foreign currency deposit account, Mobile baking, School Banking, Priority Banking.
Standard
Priority Banking As customers’ wealth grows, so do your needs and aspirations. Whether you are looking to invest,
Chartered
protect your wealth, make cash transactions, or buy or sell property, our holistic wealth management services have it
Bank Ltd.
covered. As a Priority Banking client, you get a dedicated relationship manager, supported by our 24-hour Priority
Contact Centre. We recognize your status globally, so you can draw on our pool of experts, network and strong
capabilities across our markets. You can count on us for your global banking needs, because your priorities are ours too.
Foreign i. Citi Bank led the first-ever global bond for Banglalink Digital Communications Ltd.
Commercial Bank
ii. Citi Bank arranged the largest IPO in Bangladesh for Grameenphone Ltd.
iii. Citi Bank is the first bank to launch online transaction banking solution in the country in 2003—CitiDirect
iv. Citi Bank is the first bank to launch Direct Debit Program in 2012
Citi Bank Ltd.
v. Citi Bank is the first bank to organize Electronic Payment Road shows across the country in 2014 in
collaboration with Central Bank
vi. Citi Bank Bangladesh is the only bank with E-Collect/Virtual Account solutions
vii. Only bank capable of providing real time MIS against incoming Electronic Fund Transfers.
Name of Bank Special Services
Al-falah Quick Finance: Al-falah Quick Finance is a personal loan against National Saving Certificates, Prize
Types of Bank Bonds, Al-falah GHP Principal Protected Fund & PKR/FCY deposit for meeting personal, family and household
needs. It is one year revolving limit with quarterly mark-up payments. The amount of financing under AQF ranges
Bank Al-falah from Rs. 50,000 to 2.5 Crore. AQF shall not exceed 90% of the encashment value of the security offered. In case
of financing against Foreign Currency Deposit the maximum financing should not exceed 85% of the deposit
encashment value. In case of Al-falah GHP Principal Protected Fund taken as a security the financing approved
under AQF shall not exceed 70% of the face value of units held by the borrower.

Table 8. Suggestion of Respondents to Build up Trust on E-Banking in Bangladesh.

Provide More E- Improve E- Using Secured Avoid E-mail

Increase E-Banking security
Banking Services Service Quality Password Notification
95 (42.41%) 26 (11.61%) 170 (75.89%) 77 (34.37%) 17 (7.59%)
Authentication of Cash Continuous Power Close Circuit
Increase E-Banking Practice Using Digital Signature
Withdrawals Supply Camera
41 (18.30%) 22 (9.82%) 75 (33.48%) 92 (41.07%) 27 (12.05%)
Number of Increase Speed Quality of Infrastructural Avoid Share Using One-Time
Using Finger Print
Respondents Internet Service Development Password Password
100 (44.64%) 151 (67.41%) 45 (20.10%) 51 (26.77%) 32 (14.29%)
Resist Hacker’s Hidden Develop Integrated
Formulate Policy Social Security Create Awareness
Camera Software
11 (4.91%) 31 (13.84%) 09 (04.02%) 55 (24.55%) 89 (39.73%)
183 Mohammad Shamsus Sadekin et al.: Customers’ Trust on E-Banking System in Bangladesh

Table No. 6 shows that to increase trust on e-banking b. Providing More E-Banking Services: Some banks are
75.89% respondents state the needs to increase e-service providing e-banking services in limited scale. These banks
quality, 44.64% mentioned the necessity of high speedy should increase their online banking services i.e. should add
internet, 42.41% respondents gives suggestion to increase e- more and more new e-banking services to their business.
banking security, 39.73% respondents think to create Domestic private commercial banks and foreign commercial
awareness to build up trust on e-banking, 34.37% thinks banks should introduce those services which are available in
bankers should use secured password, take initiative to developed countries in the world but not in Bangladesh.
increase its e-banking service in all of their branches. Some c. Improving the Quality of E-Banking Services: Banks
banks are providing e-banking services in limited scale. operating in Bangladesh should improve their e-banking
11.61% respondents think that banks should provide more e- service quality. As e-service quality of state owned
banking services. commercial banks are not good, so this type of banks should
be more conscious regarding service e-banking quality.
d. Removing Insecurities of E-Banking in Bangladesh: In
5. From the Analysis of Data the Bangladesh the security of e-banking is not so good. Banks
Following Major Findings Were should be sincere on security issues of e-banking and remove
Obtained all the insecurities of e-banking in relation to social, software
and other security.
i. It is obtained from Table 1 that the higher educated e. Securing Password: Bankers should encourage
account holders are more interested in e-banking customers to use highly secured passwords. Strong
systems. passwords are mixed password which are more secured and
ii. Table 2 shows that e-service quality domestic private difficult to hack.
commercial banks and foreign commercial banks are f. Avoiding Sharing Password: Bank will provide the
comparatively better than state owned commercial message to it’s customers not to share password with any
banks and specialized banks in Bangladesh. person. They will inform the customers about the bad impact
iii. It is gained from Table 3 that security of foreign of sharing password.
commercial banks and state owned commercial banks g. Avoiding E-Mail Notification: Banks should not use e-
is better than domestic private commercial banks. mail notifications to request confirmation of personal
iv. Table 4 express that trust on e-banking system is information or to direct downloading of attachments. Hackers
closely related with educational qualification of may find out the confidential information from e-mail and
account holders’. hack the account and manipulate.
v. It is gained from Table 5 that customers trust depend h. Using One Time Passwords (OTP): One-time passwords
customers’ satisfaction on e-service quality and others (OTPs) are used only once. This type of password may be
like as behavior of bankers, helping mentality, internal used by the users to protect cyber-crime in banking sector. A
environment of banks etc. card will keep many passwords. When any password is used
vi. Table 6 shows that all banks provide e-banking service that password cannot be used again. Developed country has
but foreign commercial banks covers all the services of already introduced but till Bangladesh doesn’t implement this
e-banking system. software for better e-banking security. It will make e-banking
vii. It is attained from Table 7 that domestic private activities more secured.
commercial banks and foreign commercial bank (i). Using Finger Print: Finger print may be used instead
provide some special service to their customers. of digit or letter type password. It will not be possible
for any hacker to collect the finger print of account
holder. So by using finger print cybercrime in
6. Necessary Steps to Enhance banking sector can be minimized.
Customers Trust on E-Banking in (ii). Authenticating Cash Withdrawals: Bank should make
Bangladesh the arrangement to authenticate cash withdrawals
from ATM booth. When any customer insert card to
On the basis of respondent’s comments, expert’s opinions, withdraw money ATM booth bank’s server will seek
and observations & judgment of the researcher the following confirmation through account holder’s cell phone. If
requirements are developed to build up trust on e-banking in account holder confirms then the transaction will take
Bangladesh: place and cash will be delivered. Otherwise cash will
a. Increasing E-Banking Practices: As state owned not deliver by the ATM booth. If any unexpected
commercial banks are in backward position in e-banking person tries to make any transaction, account holder
practices; so this type of banks should take initiative to will inform the bank to take action against hacking.
increase its e-banking service in all of their branches. Banks (iii). Ensuring Continuous Power Supply: For the
which are not providing e-banking services till now should operation of e-banking continuous power is a must. It
start immediately. can be made possible by generating power by own
 International Journal of Economics, Finance and Management Sciences 2019; 7(6): 178-186 184

generator. Bank will provide generator to each branch Customer should select incepted and secured ordering site.
and ATM booth. For that they should look for two critical things on the
(iv). Ensuring Close Circuit Camera: Banks should ensure ordering page before placing any online orders: (1) a lock
close circuit camera in every branch and ATM. In icon in the bottom-left or top-right corner, which indicates
addition, ATM boots stuff must request face covered that the site uses encryption when transferring your personal
man or women to open face in ATM booth to information and (2) the letters "https" instead of just "http" in
authenticate the user. the URL, which also indicates that the ordering site is secure.
(v). Resisting Hacker’s Hidden Camera: Hackers may set (iii). Using Antivirus
up any hidden-camera in side of ATM Booths to Most viruses today are introduced into computers via
collect password of account holders. Then they will internet downloads and e-mail. Customers should use reputed
use this for hacking. So ATM booths should be anti-virus software and keep it updated. They should run
careful to avoid these types of crime. scans periodically and look for tell-tale signs of potential
(vi). Reducing the Dependence of Customer on Bankers: infection such as general slowness or messages indicating
To reduce the dependence of customer on banker in unavailability of your financial website when trying to log-in.
the lowest level open discussion programs, They should remember that anti-virus protection is only as
workshops or seminar may be arranged by the bank good as last update.
for e-banking customers and bankers to increase (iv).Storing Credit Card Information on a Website
knowledge and awareness about e-banking activities. While this may be more convenient but it is much less
(vii).Using Digital Signature: In this process, bank should secured. Customers should use one credit card exclusively
arrange digital signature of the customer and ensure for online shopping. In case of an old computer the hard
using it. So that signer cannot forge later and nobody drive should be erased completely discarding or selling. A
can modify the message while in transit. To ensure tech-savvy thief can recover even deleted information.
authenticity, receiver can verify the signature and (v). Choosing User Name and Password
understand that the message really comes from sender. Customers should choose user name and password wisely.
Hash algorithm and asymmetric encryption is used to A combination of letters, numbers and special characters are
perform this operation. to be used and password is to be changed periodically.
(viii). Developing Integrated E-Banking Software: Banks Obvious words or dates like a nickname or your birth date
should take initiatives to develop integrated e- should not be used. Customers should try to use mixed
banking software. Preference should be given by the (number, letter, symbol) password as e-banking password.
bank authority to use local software over foreign Such as (e.g., a5n€ k*p7). This type of password is difficult
software. Common gateway is required so that to hack and more secured.
interbank transactions can be feasible. In this regard (vi).Avoiding Sharing Personal Information
banks can negotiate with central bank. Account holders should not share personal information via
(ix). Increasing Speed Quality of Internet Service: Banks e-mail. Because the hackers can easily hack e-mail account.
are required to develop personal network to increase Normally people use easy password and user ID for e-mail
the speed quality of internet services and to facilitate address and they do not keep too much privacy of e-mail ID
their customers. or password.
(x). Changing Attitude: Bankers are suggested to take (vii). Changing Password
initiative to change the attitude of customers in favor To increase online security account holders are requested
of e-banking. Customer’s attitude is very important not to use the same password for a long time. Everyone
matter for various application of e-banking. Bank should change his e-banking password at least within one
may increase publicity, offer free services for the month. They will not use same password for online banking
short period and take other steps. that is already used for another purpose.
(xi). Developing Infrastructure: E-banking is growing fast (viii). Logging Out from Bank Site
in Bangladesh. But current infrastructure is not It is suggested to log out online banking session and re-
sufficient to provide best quality of e-service. As start the personal computer when the transaction is completed.
same as technological infrastructural development is (ix).Selecting Secured ATM Booths
also required to provide best quality of e-services. So Account holder should always try to withdraw money from
they are suggested to develop necessary e-banking any secured ATM booth. All ATM booths of Bangladeshi
infrastructure. banks are not placed in same secured area.
Bank Customers Should Take the Following Steps (x). Avoiding Public Computer
(i). Using Protection Password Customers should not use public computer for online
Customers should use protection password in their files of banking activities. Suddenly electricity may disturb and
important information, so that nobody can get access to those connection will discontinue for some time and the user will
informations. They should also store the information on a CD be unable to log out from his account. Later on anybody can
that can be kept locked in a secure location. enter into that account and manipulate that.
(ii). Securing Online Shopping (xi).Monitoring Account Regularly
185 Mohammad Shamsus Sadekin et al.: Customers’ Trust on E-Banking System in Bangladesh

It will help the account holder to make the account secured password. Many of them share their e-banking password with
for long run. If the account holder monitors his account others like spouse, parent, children, brothers, sisters and friends,
regularly he will be informed about any dis-agreement of which is very risky in the point of security. Many users have no
balance within short time. personal computer and internet connection. They use outside
Recommendations for Policy Makers computer for e-banking functions. Customers feel insecurity
On the basis findings of the study, observations of the from hijacker to withdraw and deposit money from ATM booths.
researcher and opinion of the resources persons the following All the ATM booths of Bangladeshi banks are not located in
recommendations are made for the policy makers: safe position. Bangladesh does not have sufficient infrastructure
(i). Formulating Policy for e-banking. Power crisis is a barrier for e-banking promotion
Government should formulate policy to encourage and and almost all the banks fail to provide generator to their all
facilitate e-banking practice in Bangladesh. branches and ATM booths to produce power for emergency
(ii). Social Security time. Internet connection in Bangladesh is not sufficient speedy.
Government have to ensure such social security that All the banks don’t have highly secured software for e-
customers will not feel any sort of insecurity to withdraw and transactions. Some banks used different software in different
carry money from ATM booths. In this regard, steps can be time which is painful for users. Out of these limitations e-
taken to make law enforcing agencies free, fair, and more active. banking has great effect on our banking industry. E-banking
(iii). Creating Awareness required minimum man power than traditional banking and
To increase the awareness about e-banking government reduces risk of carrying cash. Cards are provided to customer
can facilitate publicity in print and electronic media about e- who reduces huge documents for banking function. E-banking
banking practice and its security. made shopping easy by providing credit and debit card. Cards
(iv).Developing Secured Software are used for withdrawing cash from ATM booths and for
Government can provide incentives to produce highly shopping products from the market. Both bankers and customers
secured software. Central bank will monitor the security level in Bangladesh can be benefited immensely by adopting
of e-banking of Bangladeshi banks. appropriate measures in the light of the present findings for
(v). Ensuring Uninterrupted Power Supply enhancing practice and security of e-banking which are
Government should ensure continuous power supply in extremely important for the development of customers trust on
every branches and ATM booths of each and every bank. e-banking in Bangladesh.
Steps should be taken to generate more power considering
the demand of the country.
(vi).Developing Infrastructure of the Country References
Measures should be taken to develop overall infrastructure
of the country that will support e-banking practices. [1] Al-Amin S and Rahman S (2010) “Application on Electronic
Banking in Bangladesh; An Overview.” Bangladesh Research
(vii). Providing Speedy Internet Service Publications Journal.
Internet service in Bangladesh is slow. It is a barrier to
expand e-banking. Steps should be taken to make internet [2] Auta M M (2010) “E-banking in Developing Economy:
service speedy. Empirical Evidence from Nigeria” Journal of Applied
Quantitative Methods.
(viii). Providing Low Cost Equipment
Government should reduce tax on those equipment’ which [3] Baten M A and Kamil A A (2010) “E-Banking of Economical
are related with e-banking. As a result equipment will be Prospects in Bangladesh.” Journal of Internet Banking and
cheaper in the market. Commerce.
(ix).Monitoring [4] Huda F and Ahmed T (2017) “Prospect of E-Banking in
Government through central bank increase monitoring on Bangladesh: New Way to Make Banking Electronic.” Asian
e-banking so that its practices can be smooth and expanding. Economic and Financial Review.
(x). Promulgating Legal Provisions [5] Rahman M, Saha N K, Sarkaer M N I, Sultana A and Prodhan
Government should promulgate and apply special laws A Z M S (2017) “Problems and Prospects of Electronic
favoring e-banking practices and controlling frauds and Banking in Bangladesh: A Case Study on Dutch-Bangla Bank
malpractices. Limited” American Journal of Operations Management and
Information Systems.

7. Conclusion [6] Ahmed S M S, Rayhan S J, Islam M A (2011) “Problems and

Prospects of Mobile Banking in Bangladesh.” Journal of
Almost all Bangladeshi banks offer e-banking services. State Information Engineering and Applications.
owned commercial banks are in backward position and [7] Sharafi M A A, Arshah R A, Herzallah F A T and Shanab E A
specialized banks are in early stage of e-banking. Quality of e- A (2018) “The impact of Customer Trust and Perception of
banking services in Bangladesh is not good. E-banking Security and Privacy on the Acceptance of Online Banking
transactions in Bangladesh are not highly secured. Bangladeshi Services: Structural Equation Modeling Approach.”
users have lack of awareness about e-banking and its security International Journal of Industrial Management (IJIM).
and mentionable quantity of users don’t use highly secured [8] Moga L M, Neculita M, & Khani N (2012) “Trust and
 International Journal of Economics, Finance and Management Sciences 2019; 7(6): 178-186 186

Security in E-banking Adoption in Romania.” [14] Shergill G H & Li B (2005) “An Empirical Investigation of
http://rc4ht3qs8p.search.serialssolutions.com Customers' Behavior for Online Banking in New Zealand.”
Journal of Internet Commerce.
[9] Mohiuddin U (2014) “Trend and Development of E-Banking:
A Study on Bangladesh.” IOSR Journal of Business and [15] Sadekin M S & Shaikh M A H (2016) “Effect of E-Banking
Management. on Banking Sector of Bangladesh.” International Journal of
Economics, Finance and Management Sciences.
[10] Nasri W (2011) “Factors Influencing the Adoption of Internet
Banking in Tunisia” International Journal of Business and [16] Skvarciany V and Jureviciene D (2018) “Factors Influencing
Management. Individual Customers Trust in Internet Banking: Case of
Baltic States” Sustainability 2018, 10, 4809; doi:
[11] Riyadh A N, Akter M S and Islam N (2009) “The Adoption of 10.3390/su10124809.
E-banking in Developing Countries: A Theoretical Model for
SMEs.” International Review of Business Research Papers. [17] Suh B and Han I (2002) “Effect of trust on customer
acceptance of Internet banking.” Electronic Commerce
[12] Sudeep S (2007) “Internet Banking and Customer Acceptance: Research and Applications Volume 1, Issues 3–4.
The Indian Scenario” Doctor of Philosophy, Dept of Applied
Economics, Cochin University of Science & Technology. [18] Anguelov, Christoslav E, Marianne A H, and Jeanne M H
(2004) “U.S. Consumers and Electronic Banking, 1995-2003.”
[13] Gunaratnam A, Konalingam K, Ratnam U & Sivapalan A Federal Reserve Bulletin, 90 (Winter): 1–18. B.
(2018) “Factors Influencing on E-Banking Practices: Evidence
from Sri Lanka.” Journal of Sociological Research.