Adoption of electronic banking by Iranian customers

University essay from Luleå/Business Administration and Social Sciences

Abstract: In the world of banking, the development in information technology has had
an enormous effect on development of more flexible payment methods and more-
user friendly banking services. Electronic banking services are new, and
the development and diffusion of these technologies by financial
institutions is expected to result in a more efficient banking system. This
technology offers institutions alternative or non-traditional delivery
channels through which banking products and services can be delivered to
customers more conveniently and economically without diminishing the
existing services level. In recent years, some Iranian banks have started
to offer electronic banking services to their customers. This study
therefore, was conducted to develop an understanding of customer’s attitude
and adoption of electronic banking. Based on random samples: demographic,
attitudinal, and behavioral characteristics of the users of Mellat bank
from governmental sector and Saman bank from private sector were examined.
The results are presented in details. The statistical analyses revealed
significant differences between demographic profiles and attitudes of
users. Overall, branch counter was the most frequently adopted channel,
followed by ATM and electronic banking, telephone bank and e-mail bank was
the least frequently adopted channel. Demographical characteristics were
strongly associated with adoption of electronic banking. Perceptions of
relative advantages were found to influence the adoption of electronic
banking services. The result shows that security concerns and lack of
awareness about electronic banking and technical knowledge stand out as
being obstacles to the adoption of electronic banking and these results
suggest some measures to address these impediments. These measures could
help in rapid lure of more customers to users group, resulting in
considerable savings in operating costs for banks. The study provides an
updated account of the electronic banking behaviors of Iranian customers
and contributes to the literature on electronic banking in an Iranian
economy. Furthermore, the specific strategy that banks could follow to
maximize efficacy of provided services is that banks need to put much
efforts on privatization process.

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