Role of Internet Banking In Kenya
1.1Introduction
The growing use of the internet for business transaction has profound effect on the banking industry. In the developing countries, education and infrastructure are obvious factors in the slow adoption of technology in developing countries; there are probably other issues like trust that plays role. This study finds out into adoption issues of internet banking in Kenya. Internet banking allows customers to perform a wide range of banking transactions electronically via the bank’s Web site. When first introduced, Internet banking was used mainly as an information presentation medium in which banks marketed their products and services on their Web sites.
With the development of asynchronous technologies and secured electronic transaction technologies, however, more banks have come forward to use Internet banking both as a transactional as well as an informational medium. As a result, registered Internet banking users can now perform common banking transactions such as writing checks, paying bills, transferring funds, printing statements, and inquiring about account balances. Internet banking has evolved into a “one stop service and information unit” that promises great benefits to both banks and consumers. Internet banking services are crucial for long-term survival of banks in the world of electronic commerce (Burnham 1996). The market for Internet banking is forecast to grow sharply in the next few years, affecting the competitive advantage enjoyed by traditional branch banks (Duclaux 1996; Liao et al. 1999). Indeed, it also was estimated that financial institutions that failed to respond to the need for Internet banking services would likely lose more than 10% of their customer base by the year 2000 (Orr 1998; Tower Group 1996).
From the consumers’ perspective, Internet banking provides a very convenient and effective approach to manage one’s finances as it is easily accessible 24 hours a day, and seven
The growing use of the internet for business transaction has profound effect on the banking industry. In the developing countries, education and infrastructure are obvious factors in the slow adoption of technology in developing countries; there are probably other issues like trust that plays role. This study finds out into adoption issues of internet banking in Kenya. Internet banking allows customers to perform a wide range of banking transactions electronically via the bank’s Web site. When first introduced, Internet banking was used mainly as an information presentation medium in which banks marketed their products and services on their Web sites.
With the development of asynchronous technologies and secured electronic transaction technologies, however, more banks have come forward to use Internet banking both as a transactional as well as an informational medium. As a result, registered Internet banking users can now perform common banking transactions such as writing checks, paying bills, transferring funds, printing statements, and inquiring about account balances. Internet banking has evolved into a “one stop service and information unit” that promises great benefits to both banks and consumers. Internet banking services are crucial for long-term survival of banks in the world of electronic commerce (Burnham 1996). The market for Internet banking is forecast to grow sharply in the next few years, affecting the competitive advantage enjoyed by traditional branch banks (Duclaux 1996; Liao et al. 1999). Indeed, it also was estimated that financial institutions that failed to respond to the need for Internet banking services would likely lose more than 10% of their customer base by the year 2000 (Orr 1998; Tower Group 1996).
From the consumers’ perspective, Internet banking provides a very convenient and effective approach to manage one’s finances as it is easily accessible 24 hours a day, and seven