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"I feel mobile banking is distinctly faster. That is, if we be mobile and walk down to the ATM." - PowerPoint PPT Presentation

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"I feel mobile banking is distinctly faster. That is, if we be mobile and walk down to the ATM.". Customer Expectations of Internet Banking in South Africa. Jean-Paul Van Belle Simone Green University of Cape Town. Contents. Banking & the Internet e-Banking in SA Research methodology

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"I feel mobile banking is distinctly faster. That is, if we be mobile and walk down to the ATM."

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"I feel mobile banking is distinctly faster. That is, if we be mobile and walk down to the ATM."

Customer Expectations of Internet Banking in South Africa

Jean-Paul Van Belle

Simone Green

University of

Cape Town


  • Banking & the Internet

  • e-Banking in SA

  • Research methodology

  • Sample demographics

  • Some findings

  • Conclusions

How the Internet has changed banking

  • Convergence in industry

  • Innovative products

  • 24/7

  • Disintermediation

  • Re-intermediation

  • Delivery channel mix

  • Empowered customers

  • Technology focus at the expense of current customers ?

  • Personalization online

South African context

  • The digital divide: 1st 3rd world

    • 1 – 1 ½ million Internet users

    • Most South Africans don’t have bank accounts

    • Note: 10 million cell-phones

  • SA banks are early technology adopters

    • first ATMs

    • telephone banking (tone-dial based)

    • cell-phone banking (WAP-based)

  • 9 Internet Banks but only 1 “profitable”

  • 1% penetration rate for M-banking

Current state and drivers of the South African banking industry

  • Change “drivers”:

    • technology: “clicks”  “bricks”

    • consolidation: to achieve economies of scale

    • globalisation

  • Change “enablers”:

    • client sophistication

    • new information technologies

    • the Internet

  • Pressing issues:

    • service quality

    • client focus

    • profit performance

(A NZ bank gave a customer access to the account of another person with the same name. Doug Myers is one of NZ wealthiest men!)

Research Methodology:Approach

  • H0: “a gap exists between expectations of Internet banking customers, and the satisfaction of these expectations by South African banking institutions”

  • Subjective & empirical

  • Qualitative

    • 10 structured interviews

    • stratified according to gender, (private) banking relationship, dial-up corporate access, bank.

  • Quantitative:

    • web-based questionnaire

Research Methodology:“User Expectations”

  • Basic functionality, convenience and speed of website

  • Service levels both online and offline

  • Integration across banking channels

  • Cost of transactions

  • Quality of information on the website

  • Actual website usability

  • Personal contact independent of the Internet banking channel

  • Added value for the end user in terms of the service offering

Sample demographics

General Opinions

  • People stay because “it’s too much trouble to switch” (42%)

  • Price sensitivity: 65% will move if offered a better fee structure

  • Banks meet financial expectations (60%) except for 30-39 year olds (only 35%; p<5%)

  • People want to be able to open bank accounts on the Internet (86%)

  • Financial advice required (♀)

Perceived advantages of Internet banking

Perceived problems with Internet Banking

Use, usability and safety

  • Use

    • inter-account transfers (62%)

    • payments (61%)

    • statements (48%)

    • checking balances (44%)

  • Ease of Use

    • 62% want to be able to customize their banking site.

    • 55% happy with Internet service, in terms of feedback, solving technical errors and rectifying problems

  • Safety

    • 77% considers Internet banking to be secure

    • Recent security issues!

Qualitative feedback (1)

  • Improve usability:

    • Less graphics => greater speed

    • Simpler navigation

    • Better information display/layout

    • Less complex login procedure (safety?)

  • Improve functionality:

    • Integrated view of all accounts

    • Opening new accounts

    • Add new beneficiaries

    • More transactional history

Qualitative feedback (2)

  • Channel Integration

  • E-mail communication

  • Improved call centers (with operators who are empowered to conduct transactions)

  • Interactive financial tools:“[I’d like to see] a management tool that helps me analyse my budgeted expenses against my income. A system that mails me warnings when funds are low and stop orders are likely to bounce. Something that lets me assess whether I can afford a new purchase. Banks make their money off interest and I am sick of them letting my overdraft and credit spiral. I want a partner that helps me control my money.”

  • “Treat us like individuals”

The future of electronic banking

  • Transparency of service: “open access, open communication & open rates”

  • Integrated money management:convergence!

  • Retaining personalized service potential “death of personal relationships”

  • Future costspass on the cost savings to the customer


  • “Gap between customer expectations and bank services”? => basic expectations are met:

    • security, functionality, service

  • … but more value could be added:

    • channel integration; speed; costs

    • navigation; customizability

    • financial advice & services; transparency

  • Future research:

    • larger sample; more qualitative research; age differentiations; Internet-specific popular products.

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