The impact of online infomation system quality dimensions on overall tnternet banking service quality and custemer satifaction in vietnam

UNIVERSITY OF ECONOMICS HO CHI MINH CITY International School Of Business NGUYỄN THỊ HẠNH DUNG THE IMPACT OF ONLINE INFORMATION SYSTEM QUALITY DIMENSIONS ON OVERALL INTERNET BANKING SERVICE QUALITY AND CUSTOMER SATISFACTION IN VIETNAM MASTER OF BUSINESS (Honours) Ho Chi Minh City – Year 2014 UNIVERSITY OF ECONOMICS HO CHI MINH CITY International School Of Business NGUYỄN THỊ HẠNH DUNG THE IMPACT OF ONLINE INFORMATION SYSTEM QUALITY DIMENSIONS ON OVERALL INTERNET BANKING SERVICE QUALITY AND CUSTOMER SATISFACTION IN VIETNAM MASTER OF BUSINESS (Honours) Supervisor Dr Nguyễn Thị Nguyệt Quế Ho Chi Minh City – Year 2014 ABSTRACT The development of scientific technology, especially the development of the information technology have a strong impact on all aspects of life, economic - social, change awareness and method of manufacturing business many areas, many different economic sectors And banking is the sector which activate primarily base on modern information technology is influenced strongly Nowadays, developing internet banking services is the inevitable trend in Vietnam Because Internet banking brings the great benefits for customers and the economy, due to its utility, convenience, promptitude, accurate and secure The banks enhance expressly quality of internet banking service to satisfy the customer aim to higher profit The success of a internet banking service depend on three dimensions : product, service quality, technology There are many studies research about the factors impact on internet banking service quality and how to develope them to satisfy the customer 's demands but in Vietnam very few stuies mentioned to the quality of information technology while internet banking service quality depends primarily on information technology system The customer will not satisfy with internet banking service quality if the information technology system don’t operate well and trouble happen frequently Based on that, the study was conducted to research "The impact of online information system quality dimensions on overall internet banking service quality and customer satisfaction in Vietnam” The study was conducted by exploratory factor analysis (EFA) method and multiple linear regression (MLR) for measuring model The survey questionnaires were transfer to a sample of 250 consumers who has used internet banking services in Vietnam The result revealed that six dimensions of online Information system quality including Aesthetic, Timeliness, Contents, Ease of use, Security, Accuracy are important dimensions impact on customer satisfaction in using Internet banking and Accuracy is the most important dimensions Based on the results of research, the author hopes that the bank managers realized the big influence of information system quality on internet banking service quality to carry out effective solutions to develop internet banking service in Vietnam TABLE OF CONTENTS ABSTRACT LIST OF FIGURES CHAPTER I: INTRODUCTION 1.1 Research background 1.2 Problem statement 1.3 Research objectives 1.4 Significance of the research 1.5 Research scope and methodology 1.5.1 Research scope 1.5.2 Research methodology 1.6 Thesis structure CHAPTER 2: LITERATURE REVIEW and THEORETICAL MODEL 2.1 Online information system quality 2.1.1 Definition of online information system quality 2.1.2 Dimensions of online information system qualit 2.2 Overall internet banking service quality 2.2.1Servicequalityconcept 2.2.2Overall internet banking service quality concept 2.2.3Impact ofonline information system quality dim banking service quality 2.3 Customer Satisfaction 2.3.1 Customer satisfaction definition 2.3.2Customer satisfaction in internet banking contex 2.3.3 Impact of overall internet banking service qu in E-banking context 2.4 Theoretical model and hypothesis Summary: CHAPTER 3: RESEARCH METHODOLOGY 3.1 Research Process 3.2 Measurement Scales 3.2.1 Measurement of online information systems q 3.2.2 Measurement of overall internet banking serv 3.2.3 Measurementof customersatisfaction 3.3 Questionaire design 3.4 Pilot study 3.5 Main survey 3.5.1Data collection method 3.5.2Sampling method 3.5.3Sample size 3.6 Data analysis techniques 3.6.1 Testing of reliability 3.6.2 Exploratory factor analysis (EFA) 3.6.3Multiple regression analysis CHAPTER 4: ANALYSIS RESULT 4.1 Sample description 4.2 Testing reliability of measurement scales 4.3 Exploratory factor analysis 4.3.1 T 4.3.2 T 4.3.3 T 4.4 Testing correlations between all constructs 4.5 Testing research model and hypothesis 4.5.1The relationship between online information and overall internetbanking service quality 4.5.2 T Customer Satisfaction 4.6 Discussions of research findings CHAPTER 5: CONCLUSION AND IMPLICATIONS 5.1 Conclusions 5.2 Managerial implications 5.3 Limitations and Recommendation for further resea REFERENCE APPENDIX LISTOFTABLES Table 3.1: Measurementof aesthetics Table 3.2:Measurementof timeliness Table 3.3: Measurementof the content Table 3.4:Measurementof ease of use Table 3.5:Measurementof security Table 3.6: Measurementof accuracy Table 3.7: Measurement of overall internet banking service quality Table 3.8: Measurement of customersatisfaction Table 3.9: The sample size Table 3.10: Cronbach’s alpha reliability coefficient Table 4.1: Demographic Characteristics of the Study Table 4.2: KMO and Bartlett's Test Table 4.3: KMO and Bartlett’s Test Table 4.4: Rotated Component Matrix a Table 4.5: KMO and Bartlett’s Test Table 4.6: Rotated Comonent Matrix Table 4.7: KMO and Bartlett’s Test Table 4.8: Total Variance Explained Table 4.9: Component Matrix a Table 4.10: KMO and Bartlett's Test and Component Matrix Table 4.11:ANOVA b Table 4.12:Model Summary Table 4.13: Coefficients a Table 4.14:Model Summary Table 4.15:ANOVA b b b Table 4.16:Coefficients a LIST OF FIGURES Figure1:Themodelof research Figure2:Themodelof researchprocess CHAPTER I: INTRODUCTION In this chapter, the problems are discussed such as introducing the role and importance of internet banking in the banking industry; internet banking ‘s situation in VietNam; research objectives, scope and methodology Many researchers have discussed about internet banking but most of them has not focused on online information system quality dimensions that affect customer satisfaction in internet banking And the cause the thesis was chosen 1.1 Research background Internet banking could be conceptualized within the context of electronic banking Internet banking is the situation where “customers can access their bank account via the Internet using a PC or mobile phone and web-browser” (V.A Zeithaml et al.,2002, p.2) Currently, Internet banking relies on the Internet environment, service is provided entirely through the network environment and there is combining commercial banking system and traditional electronic goods, such as the distribution of products and services on the old new distribution channels In recent years, Internet banking has grown worldwide with fast speed This service is also considered as retail distribution channels and it is the most successful banking services in terms of growth rate of number of customers Internet banking allows customers to use the service through the bank’s website anytime, anywhere, quickly, conveniently at a lower cost than other traditional services of banks (White and Nteli, 2004) Internet banking enables customers to save time, take control of their personal finances and even help the environment by opting to receive electronic statements Customer can access accounts and general information on bank products and services through a personal computer or other intelligent device Internet banking products and services can include detailed account information for corporate customers as well as account summary and transfer money Internet Banking helps banks save up human resources by multiple steps have been automated but still ensure for provide high quality services to a large number of their customers And so, not the profits of the bank increased but more importantly, their reputation has been enhanced.For the banks, internet banking also allows them to reduce operating costs, reduce dependence on the expansion of the branch network, expanding business sector, support the strengthening relationship with customers (Shih and Fang, 2004).Through Internet Banking, communication and transactions between banks and customers has also been speeded up Moreover, intense pressure of uncertain economic outlook, a growing threat from new entrants foster each banks to differentiate themselves to compete with both local and foreign banks Therefore, the decision to provide Internet Banking is currently perceived as vital for customer retention and maintaining competitive advantage (DeYoung and Duffy, 2002) According to Gartner Group report, the growth rate of online banking services in the U.S is very high, from ten million users in 1999 to thirty -five million users in 2003 According to the report of the organization, online banking services are also used similar popularity in the U.S., in 2009, approximately 30-40 % of the UK population currently use this service In Brazil, there are about 18.1 million users of online banking services in 2004 It is compared with 8.3 million users in 2002, including 16.2 million user accounts are individual subscribers Here, these financial sites are always be the sites traffic and most used, with the figure of 50 % of the total 13.5 million Internets account login regularly (Vichuda and Serap Ekin, 2001) Moreover, if the only consideration in 2004, the Bank of Brazil has invested about 2.1 billion dollars in the technology sector (Febraban, 2004), including the development of online banking services and a number of other areas Starting in 1994, internet banking in Vietnam was built on the foundation of information technology and banking technology at a low level, only allowing customers to access to get information and makesimple payments In just a short time, the level of information technology in our country has made significant improvement, it leads to the rapid development of the industries applied the information technology such as banking sector.In recent years,internetbanking services is growing more aggressive and having strong shifts However, internet banking in Vietnam is only in the early stages of development and was monotonous, meager and not attract many customers Non-cash payment in Vietnam is still low, the proportion of cash used in bank circulation / total means of payment is ranged between 24-25% This rate is much higher than other countries in the region such as Thailand (6.3%), China (9.7%) Psychology preferred cash in using VND, foreign currencies and the understanding of banking services by Vietnamese are low is one of the reasons for extending banking services difficultly 28 TIM Timelin 29 CON Conten 30 USE Ease of 31 SEC Securit 32 ACC Accura 33 IBQ Overal 34 SAT Satisfa 75 Appendix Cronbach's Alpha Measures of Variables in the Study Variables Scal Item Aestheti: Alpha = 0.786 AES1 7.47 AES2 7.47 AES3 7.47 Timeliness: Alp TIM1 7.51 TIM2 7.35 TIM3 7.43 Contents: Alpha = 0.739 CON1 10.4 CON2 10.5 CON3 10.6 CON4 10.4 Ease of use: Alpha = 0.857 USE1 11.5 USE2 11.6 USE3 11.7 USE4 11.5 Security: Alpha = 0.852 SEC1 7.57 SEC2 7.65 SEC3 7.65 Accuracy: Alpha = 0.823 ACC1 7.87 ACC2 7.89 ACC3 7.68 Overall internet banking service quality: Alpha = 0.710 IBQ1 7.38 IBQ2 IBQ3 Customer Satisfaction: Alpha = 0.764 SAT1 SAT2 SAT3 77 Appendix Total Variance Explained Initial Eigenvalues Comp onent Total 6.578 2.087 1.943 1.692 1.208 1.151 677 539 496 10 423 11 370 12 330 13 293 14 280 15 241 16 224 17 174 18 152 19 140 Extraction Method: Principal Component Analysis 78 Appendix Rotated Component Matrix a Compon USE2 880 USE4 835 USE1 831 USE3 471 AES1 436 TIM3 TIM1 128 TIM2 161 SEC1 SEC3 111 SEC2 192 CON4 CON1 CON2 192 ACC2 198 ACC3 263 ACC1 188 AES2 160 AES3 145 Extraction Method: Principal Component Analysis Rotation Method: Varimax with Kaiser Normalization a Rotation converged in iterations 79 Appendix Total Variance Explained Initial Eigenvalues Comp onent Total 6.167 2.085 1.931 1.662 1.205 1.147 580 507 444 10 375 11 330 12 295 13 292 14 248 15 225 16 189 17 174 18 144 Extraction Method: Principal Component Analysis 80 Appendix Total Variance Explained Com Initial Eigenvalues pone nt Total 5.746 2.070 1.922 1.653 1.178 1.135 511 447 376 10 334 11 324 12 13 294 262 14 225 15 190 16 17 Extraction Component Analysis .174 159 81 Appendix Correlations IBQ Pearson Correlation Sig (2-tailed) N SAT Pearson Correlation Sig (2-tailed) N USE Pearson Correlation Sig (2-tailed) N TIM Pearson Correlation Sig (2-tailed) N CO Pearson Correlation N Sig (2-tailed) N SEC Pearson Correlation Sig (2-tailed) N ACC Pearson Correlation Sig (2-tailed) N AES Pearson Correlation Sig (2-tailed) N Correlations IBQ Pearson Correlation Sig (2-tailed) N SAT Pearson Correlation Sig (2-tailed) N USE Pearson Correlation Sig (2-tailed) N TIM Pearson Correlation Sig (2-tailed) N CO Pearson Correlation N Sig (2-tailed) N SEC Pearson Correlation Sig (2-tailed) N ACC Pearson Correlation Sig (2-tailed) N AES Pearson Correlation Sig (2-tailed) N ** Correlation is significant at the 0.01 level (2tailed) 83 Appendix Histogram Scatter Diagrams 84 Appendix 10 Histogram Scatter Diagrams 85 ... 2.1 Online information system quality 2.1.1 Definition of online information system quality 2.1.2 Dimensions of online information system qualit 2.2 Overall internet banking service quality. .. Overall internet banking service quality 2.2.3 Impact ofonline information system quality dimensions onoverall internet banking service quality Online information system quality is vital to internet... online information system quality dimensions to overall internet banking service quality and customer satisfaction The dimensions of online information system quality including aesthetic, timeliness,