Factors affecting the satisfaction of customers to internet banking of vietnam joint stock commercial bank for industry and trade vietinbank ba dinh branch

Master Finance - Banking - Insurance (South East Asia) Cohort 2016 -02018 MASTER THESIS Factors affecting the satisfaction of customers to Internet Banking of Vietnam Joint Stock Commercial Bank for Industry and Trade(Vietinbank) - Ba Dinh Branch Author:NGUYEN THI THIEN HUONG Supervisor: PhD DAO TUNG Hanoi, 05/2018 i ACKNOWLEDGEMENT I would like to thank all of Lecturer of National Economics University, Lecturers of International School - Vietnam National University, Ha Noi; Professors of Nantes University – French Republic have enthusiastically imparted knowledge to me during the past time I express my deepest gratitude to my Supervisor, PhD Dao Tung, who have helped me during the period of studying and completing this Thesis Finally, I would like to thank my family, colleagues and friends for their support and sharing experiences during the thesis Sincerely thank! Hanoi, May 2018 Nguyen Thi Thien Huong ii TABLE OF CONTENTS ACKNOWLEDGEMENT ii ABSTRACTS vii CHAPTER 1: INTRODUCTION 1.1 Research reasonale: 1.2 Questions and research objects: 1.3 Research Methods: 1.3.1 Research objects 1.3.2 Research area: 1.3.3 Research methods: 1.4 Practical meaning of the topic 1.5 Overview of past research on the subject: 1.6 Proposed structure of the thesis CHAPTER 2: THEORITICAL FOUNDATION 2.1 E-commerce and Internet Banking 2.1.1 E-commerce concepts 2.1.2 Internet banking service 2.2 Customer Satisfaction: 10 2.2.1 Concepts of customer satisfaction 10 2.2.2 The relationship between customer satisfaction and service quality 12 2.3 Factors affecting the Customers' Satisfaction to Internet Banking: 12 2.4 Reality of internet banking services by Ba Dinh branch 15 2.4.1 The development of internet banking services of Ba Dinh Branch 15 2.4.2 Characteristics of internet banking services of Ba Dinh Branch 16 2.4.3 Customer participation in internet banking 16 2.4.4 The results of internet banking services of the branch in recent years 17 CHAPTER 3: RESEARCH METHODS 18 3.1 Research model and Hypothesis: 18 3.2 Development of research hypothesis: 18 3.2 Research Process: 19 3.3 Research Methods: 21 CHAPTER 24 DATA ANALYSIS AND KEYS FINDING 24 4.1 Description of the sample: 24 4.2 Validation of the Scale: 26 4.2.1 Explanatory factor analysis of customer satisfaction factor 26 4.2.2 Explanatory factor analysis of the antecedents of customer satisfaction 27 4.2.3 Reliability test analysis 30 4.3 Behavior of using Internet Banking services of the samples: 33 4.3.1 Description of the behavior of using Internet Banking services of the samples 33 4.3.2 The impact of demographic variables on customer satisfaction 37 4.4 Validation of hypothesis: 39 4.5 Summary of key findings 42 Chapter 5: CONCLUSION 44 5.1 Summary of the research results 44 5.2 Managerial Implication 45 5.2.1 Ease of use: 45 iii 5.2.2 Continuous Improvement: 45 5.2.3 Speeds of Responses: 46 5.2.4 Confidentiality and Security: 46 5.3 Limitation of research: 46 REFERENCES: 47 APPENDIX 49 APPENDIX 53 APPENDIX 57 APPENDIX 60 APPENDIX 64 iv LIST OF TABLES Table Factors afecting to customers satisfaction of using internet banking 13 Table 2 Implementation of Internet Banking in VietinBank Ba Dinh Branch 16 Table Customer structure using Internet Banking 17 Table Business results of Internet Banking services 17 Table A3- Independent Sample T-Test of gender 57 Table A3- One-Way ANOVA for age 57 Table A3- One-Way ANOVA for monthly income 58 Table A3- One-Way ANOVA for how long of using Internet banking services 58 Table A3- One-Way ANOVA for the frequency of using Internet banking services 59 Table A3- One-Way ANOVA for the service that the respondents use the most 59 Table A4- Mean value and standard deviation analysis 60 Table A4- KMO value and Bartlett‟s Test of customer satisfaction factor 61 Table A4- Total variance explained by the components of customer satisfaction factor 61 Table A4- Component matrix of customer satisfaction factor 61 Table A4- KMO value and Bartlett‟s Test of the antecedents of customer satisfaction factor 62 Table A4- Total variance explained by components of the antecedents of customer satisfaction factor 62 Table A4- Component matrix of the antecedents of customer satisfaction factor 63 Table A5- Reliability test of customer satisfaction factor 64 Table A5- Reliability test of reliability factor 64 Table A5- Reliability test of ease of use factor 64 Table A5- Reliability test of confidentiality and security factor 64 Table A5- Reliability test of speed of responses factor 65 Table A5- Reliability test of continuous improvement factor 65 Table A5- Reliability test of products/services diversification factor 65 Table A5- Multiple linear regression 66 Table A5- Conclusion of hypothesis testing 66 v LIST OF FIGURES Figure Proposed Model 18 Figure A2 Gender description 53 Figure A2 Age description 53 Figure A2 Education description 54 Figure A2 Monthly income description 54 Figure A2 Description of how long the respondents use Vietinbank‟s Internet banking services 55 Figure A2 Description of frequency that the respondents use Vietinbank‟s Internet banking services 55 Figure A2 Description of which Vietinbank‟s Internet banking services the respondents use the most 56 vi ABSTRACTS In Vietnam, the popularity of internet in recent years has opened a potential market for E-banking services in Vietnam Moreover, the government and the State Bank of Vietnam have also created legal framework through the promulgation of laws, circulars, decrees and decisions that encourage the development of E-banking Especially, “Electronic transaction law 2005” has created the basic legal framework for electronic transactions Internet banking services have been implemented in Vietnam but it has developed strongly especially in urban areas Due to the preeminent features of internet banking such as saving time and money, convenient transaction , commercial banks in Vietnam have developed this type of service and created the competitive environment to win customers Meanwhile, customers are aware of the benefits of internet banking but are still concerned about the safety and security of internet banking Therefore, customers should undergo the process of analyzing the choice between different types of services and between different brands to decide the behavior of using internet banking Internet Banking is a new type of banking service in Vietnam and therefore, in-depth and comprehensive research into consumers‟ satisfaction with Internet Banking will be significant for banks as well as for the people themselves Starting from these practical issues, with the desire to improve the quality of Internet Banking service, this research topic “Factors affecting the satisfaction of customers to Internet Banking ofVietnam Joint Stock Commercial Bank for Industry and Trade (Vietinbank) - Ba Dinh Branch" hopes to contribute little help to have orientation and solution to improve the quality of service and make the most use of it vii CHAPTER 1: INTRODUCTION 1.1 Research reasonale: The development of information technology in banking has significantly changed the business strategy of many commercial banks Instead of providing traditional banking services, commercial banks are taking advantage of information technology, especially the internet, to provide customers with modern banking services (this is called electronic banking) E-banking services bring many benefits to the bank such as reducing the number of employees, branches, increasing the number of transactions thereby reducing costs and increasing profits For customers, e-banking services enable customers to trade quickly, conveniently, and save travel time, transaction costs… Vietnam is one of the countries with the highest number of Internet users in the world (nearly 40 million users, 14 in the world) The high number of internet users with strong growth has created favorable conditions for the development of e-commerce in general and e-banking in particular Currently, the level of competition in e-banking services in Vietnam is getting higher everyday, if in 2004 Vietnam had only three banks providing electronic banking services, by the end of 2014 there was 43 banks that provided the service Therefore, in order to be competitive in this area, Vietnamese commercial banks are actively investing in electronic infrastructure, however, banks have yet to meet the growing demand of customers so they still have not satisfied their customers and have not found the loyal customers On the other hand, in order to be competitive in e-banking, banks need to understand the criteria that customers use to evaluate the quality of e-banking services, so that they can have solutions to improve the quality of service and customer satisfaction To so, it is necessary to build a research model that defines the relationships among criteria that reflect the quality of e-banking services with customer satisfaction and loyalty under the impact of other intermediaries (switching costs, customer trust ), thus providing direction for the competitive strategy of banks With the online transaction utilities, just by one single-mouse-click, customers can make all forms of basic banking such as transferring, placing orders and transferring money periodically and check any account balance whenever they want Many previous studies measured customer satisfaction in traditional banking environments, where direct interaction between customers and bankers occurs (Johnston 1995, Bahia & Nantel 2000) However, for online banking, the interaction between customers and banks does not occur directly on the Internet Therefore, Vietinbank needs to understand the customer's perception of online banking services, the expectations of customers to evaluate the products that the bank provided is satisfactory or not Therefore, the study “Factors affecting the satisfaction of customers to Internet Banking of Vietnam Joint Stock Commercial Bank for Industry and Trade (Vietinbank) - Ba Dinh Branch"is very necessary and timely It helps Vietinbank to have a more general view of the satisfaction of internet banking from the perspective of individual consumers Through this research, to find out what factors most affect customer satisfaction in order to maintain the development, besides to overcome the factors are not satisfactory to increasingly satisfy customer From that Vietinbank-Ba Dinh Branch will have more effective plans for its products and services, satisfying the criteria of convenience and safety "whenever and wherever", which product aim for 1.2 Questions and research objects: The core objective of the research is to focus on the factors that affect the personal satisfaction of customers using online banking services of Vietinbank, Ba Dinh Branch Identifying these factors has important implications for the managers of Vietinbank, based on that, they will have the right direction, development and investment for their products and services Therefore, the research objectsfocus on: - Description of customers' behavior of using Internet Banking services - Developing a model to study the factors that affect the satisfaction of customers using internet banking - Recommend some solution to the banking management to satisfy customers' need To properly address the research objectives, set out, the following research questions should be clarified: - What factors affect the satisfaction of individual customers using online banking services of Vietinbank, Ba Dinh Branch? - Research will use specific methods to build and test the model of factors that affect customer satisfaction, thereby determining which factors have the most influence on satisfaction of customers? Based on that, the writer will find a different approach to customers with traditional methods and bank managers also have direction in the business of Vietinbank, especially the online banking service 1.3 Research Methods: 1.3.1 Research objects The research focus on the Internet banking services of typical commercial banks in Nha Trang city The main aspect is from the consumer perspective to determine the factors that affect the satisfaction of individual customers using internet banking services 1.3.2 Research area: Survey‟s time: from November 2017 to May 2018 Survey conducted on 200 individual customers are using online banking services of Vietinbank, Ba Dinh Branch 1.3.3 Research methods: The formal study was conducted by means of quantitative research using direct interview techniques through detailed questionnaire The questionnaire contained 30 statements about satisfaction and the factors that affected customer satisfaction Each statement is measured on a 5-point Likert scale Sampling is a method of quota combined with convenience After three months of data collection, 200 useful questionnaires were processed and analyzed Use SPSS 16.0 software to assist in data processing 1.4 Practical meaning of the topic This research has brought some theoretical as well as practical implications for VietinBank that has been deploying internet banking Internet banking is a new service that Vietinbank has just launched in recent years Access to this service is relatively new to most customers Therefore, the topic of focusing on cognitive and customer needs for internet banking services is very practical for VietinBank executives, to capture the main factors affecting the Satisfaction of customers This is a way for VietinBank Ba Dinh to improve the quality of services, enhance competitiveness, contribute to the direction of the government is to develop non-cash economy 1.5 Overview of past research on the subject: In order to carry out the study, the author consulted many directly and indirectly relevant research papers and works of scholars at home and abroad to carry out the study of sobriety and loneliness as well as constructing Research models The quality of service in general and the satisfaction of customers in providing services of enterprises in particular is a matter of decisiveness, competitiveness and customer loyalty Customer Satisfaction Research is widely regarded not only by domestic and foreign researchers, but also by various business sectors in many production areas Customer satisfaction according to many studies is the satisfaction of customers, express services provided by the business meet the requirements and expectations of customers Authors often value customer satisfaction through quality of service, if customers value quality services, they are satisfied with the service they provide Customer Satisfaction Model is associated with the service quality model, with the participation of several authors such as Gronroos (1984), Parasuraman et al (1988), Cronin CSA2 CSA3 I completely satisfy with current internet banking services I feel pleasant to use internet banking services Please provide your recommendations to further improve performance of Internet banking services in Vietinbank - Ba Dinh Branch: ………………………………………………………………………………………………… …… ………………………………………………………………………………………………… …… ………………………………………………………………………………………………… …… ………………………………………………………………………………………………… 52 APPENDIX 99 Male Female 101 Figure A2 Gender description 10 Less than 20 20-25 6 42 38 26-30 31-35 36-40 41-45 48 46-50 More than 50 48 Figure A2 2Age description 53 10 87 Post-graduate Graduate Vocational school 103 Figure A2 3Education description 59 70 Less than 10VNDm 10-15VNDm 15-20VNDm More than 20VNDm 67 Figure A2 4Monthly income description 54 13 56 67 Less than months 6-12 months 12-18 months 18-24 months 64 Figure A2 5Description of how long the respondents use Vietinbank’s Internet banking services 93 Once per month Twice per month 104 More than twice per month Figure A2 6Description of frequency that the respondents use Vietinbank’s Internet banking services 55 Online money transfer to other Vietinbank’s accounts Online money transfer to other bank’s accounts 64 60 Online saving book Online payment for products and services Query historical transaction 63 Figure A2 7Description of which Vietinbank’s Internet banking services the respondents use the most 56 APPENDIX The result of Independent Sample T-Test for gender variable is shown through Table A3-1 Table A3- 1Independent Sample T-Test of gender Items Customer satisfaction Reliability Ease of use Confidentiality and security Speed of responses Continuous improvement Assumption T Sig (2-tailed) Equal variances assumed -1.574 0.117 Equal variances not assumed -1.574 0.117 Equal variances assumed -3.042 0.003 Equal variances not assumed -3.036 0.003 Equal variances assumed -0.825 0.411 Equal variances not assumed -0.826 0.410 Equal variances assumed 0.408 0.683 Equal variances not assumed 0.408 0.684 Equal variances assumed -1.158 0.248 Equal variances not assumed -1.157 0.249 Equal variances assumed -0.594 0.553 Equal variances not assumed -0.594 0.553 Products/services Equal variances assumed 0.082 0.934 diversification Equal variances not assumed 0.082 0.934 The result of One-Way ANOVA for age variable is shown through Table A3-2 below: Table A3- 2One-Way ANOVA for age Factors F Sig Customer satisfaction 0.301 0.953 Reliability 1.024 0.415 Ease of use 1.203 0.303 Confidentiality and security 0.261 0.968 Speed of responses 0.766 0.616 Continuous improvement 0.481 0.848 Products/services diversification 0.405 0.898 The result of One-Way ANOVA for education variable is shown through Table 4-17 below: 57 Table A3 1:One-Way ANOVA for education Factors F Sig Customer satisfaction 5.064 0.007 Reliability 0.366 0.694 Ease of use 1.384 0.253 Confidentiality and security 1.307 0.273 Speed of responses 2.014 0.136 Continuous improvement 2.904 0.057 Products/services diversification 0.219 0.803 The result of One-Way ANOVA for monthly income variable is shown through Table A3-3 below: Table A3- 3One-Way ANOVA for monthly income Factors F Sig Customer satisfaction 659 578 Reliability 830 479 Ease of use 131 941 Confidentiality and security 2.980 033 Speed of responses 1.159 326 Continuous improvement 267 849 Products/services diversification 892 446 The result of One-Way ANOVA for how long of using Internet banking services variable is shown through Table A3-4 below: Table A3- 4One-Way ANOVA for how long of using Internet banking services F Sig Customer satisfaction 0.036 0.991 Reliability 0.978 0.404 Ease of use 0.334 0.801 Confidentiality and security 1.427 0.236 Speed of responses 0.167 0.919 Continuous improvement 0.152 0.928 Products/services diversification 0.196 0.899 The result of One-Way ANOVA for the frequency of using Internet banking services variable is shown through Table 4-20 below: 58 Table A3- 5One-Way ANOVA for the frequency of using Internet banking services Factors F Sig Customer satisfaction 4.932 0.008 Reliability 0.284 0.753 Ease of use 0.984 0.375 Confidentiality and security 1.440 0.239 Speed of responses 0.717 0.490 Continuous improvement 7.298 0.001 Products/services diversification 0.381 0.684 The result of One-Way ANOVA for the service that the respondents use the most variable is shown through Table A3-6 below: Table A3- One-Way ANOVA for the service that the respondents use the most Factors F Sig Customer satisfaction 0.458 0.767 Reliability 0.429 0.788 Ease of use 0.132 0.970 Confidentiality and security 0.206 0.935 Speed of responses 0.338 0.852 Continuous improvement 2.521 0.042 Products/services diversification 0.713 0.584 59 APPENDIX Table A4- 1Mean value and standard deviation analysis Items Mean Statement Std Deviation My expectation before using internet banking CSA1 services is fulfilled after using internet banking 3.33 0.512 3.24 0.691 2.64 0.821 3.36 0.998 2.09 0.788 2.37 0.852 3.53 0.896 3.52 0.946 3.94 1.033 3.43 0.780 3.81 0.811 3.65 0.906 3.32 1.031 3.26 1.019 3.36 1.139 3.23 1.097 3.18 1.055 services CSA2 CSA3 REL1 REL2 REL3 EOS1 EOS2 EOS3 CAS1 CAS2 CAS3 SOP1 SOP2 SOP3 CIM1 CIM2 I completely satisfy with current internet banking services I feel pleasant to use internet banking services The bank performs internet banking services correctly right at the first time Information which is provided in internet banking services is accurate The information is always up to date in internet banking services Internet banking services not require me to put a lot of efforts I feel comfortable to use computer for internet banking services Internet banking services has the website which is easy to navigate I not concern about the security of internet banking services I not concern about the privacy of internet banking services I feel trust when using internet banking services The speed of login your accounts of internet banking services is fast The webpage of internet banking services is downloaded quickly Usage internet banking services saves my time The bank frequently updates internet banking services with new features The bank has employees to record the customers‟ demands related to the features of internet banking 60 services CIM3 SPD1 SPD2 SPD3 The errors of the website of internet banking services are fixed quickly The bank provides wide range of services in its internet banking services The bank provides internet banking services with features I want All my services that I need are integrated into menu options 2.86 1.021 3.36 1.022 3.24 0.922 2.10 0.897 Table A4- 2KMO value and Bartlett’s Test of customer satisfaction factor Kaiser-Meyer-Olkin Measure of Sampling Adequacy Bartlett's Test of Sphericity 0.691 Approx Chi-Square 218.389 df Sig 0.000 Table A4- 3Total variance explained by the components of customer satisfaction factor Component Initial Eigenvalues Total % of Variance Cumulative % 2.204 73.450 73.450 0.491 16.381 89.832 0.305 10.168 100.000 Table A4- 4Component matrix of customer satisfaction factor Component Items CSA1 0.897 CSA2 0.846 CSA3 0.826 61 Table A4- 5KMO value and Bartlett’s Test of the antecedents of customer satisfaction factor Kaiser-Meyer-Olkin Measure of Sampling Adequacy Bartlett's Test of Sphericity 0.605 Approx Chi-Square 1208.228 df 153 Sig 0.000 Table A4- 6Total variance explained by components of the antecedents of customer satisfaction factor Component Initial Eigenvalues Total % of Variance Cumulative % 2.975 16.529 16.529 2.325 12.914 29.444 2.111 11.728 41.172 2.016 11.199 52.371 1.612 8.955 61.325 1.497 8.314 69.640 0.818 4.547 74.186 0.657 3.650 77.836 0.652 3.621 81.457 10 0.583 3.241 84.698 11 0.497 2.764 87.462 12 0.487 2.708 90.170 13 0.439 2.437 92.606 14 0.337 1.874 94.480 15 0.315 1.753 96.233 16 0.254 1.409 97.642 17 0.232 1.291 98.933 18 0.192 1.067 100.000 62 Table A4- 7Component matrix of the antecedents of customer satisfaction factor Items Component SOP2 0.873 SOP1 0.861 SOP3 0.849 EOS3 0.870 EOS1 0.838 EOS2 0.835 CAS2 0.878 CAS3 0.859 CAS1 0.778 CIM1 0.856 CIM2 0.801 CIM3 0.783 REL1 0.795 REL3 0.775 REL2 0.763 SPD1 0.817 SPD3 0.803 SPD2 0.694 63 APPENDIX Table A5- Reliability test of customer satisfaction factor Cronbach’s alpha = 0.799 Items Scale Mean if Item Scale Variance if Corrected Item- Cronbach's Alpha Deleted Item Deleted Total Correlation if Item Deleted CSA1 5.89 1.861 0.644 0.763 CSA2 5.97 1.366 0.731 0.629 CSA3 6.57 1.210 0.631 0.778 Table A5- 2Reliability test of reliability factor Cronbach’s alpha = 0.683 Items Scale Mean if Item Scale Variance if Corrected Item- Cronbach's Alpha Deleted Item Deleted Total Correlation if Item Deleted REL1 4.46 1.857 0.533 0.549 REL2 5.73 2.530 0.459 0.639 REL3 5.45 2.258 0.514 0.569 Table A5- 3Reliability test of ease of use factor Cronbach’s alpha = 0.815 Items Scale Mean if Item Scale Variance if Corrected Item- Cronbach's Alpha Deleted Item Deleted Total Correlation if Item Deleted EOS1 7.46 3.124 0.670 0.745 EOS2 7.46 3.054 0.636 0.776 EOS3 7.05 2.636 0.700 0.712 Table A5- 4Reliability test of confidentiality and security factor Cronbach’s alpha = 0.804 Items Scale Mean if Item Scale Variance if Corrected Item- Cronbach's Alpha Deleted Item Deleted Total Correlation if Item Deleted CAS1 7.46 2.441 0.596 0.788 CAS2 7.08 2.154 0.710 0.673 CAS3 7.24 1.992 0.659 0.730 64 Table A5- 5Reliability test of speed of responses factor Cronbach’s alpha = 0.836 Items Scale Mean if Scale Variance if Corrected Item-Total Cronbach's Alpha if Item Deleted Item Deleted Correlation Item Deleted SOP1 6.62 3.845 0.684 0.786 SOP2 6.68 3.776 0.723 0.750 SOP3 6.58 3.451 0.692 0.783 Table A5- 6Reliability test of continuous improvement factor Cronbach’s alpha = 0.763 Items Scale Mean if Item Scale Variance if Corrected Item- Cronbach's Alpha Deleted Item Deleted Total Correlation if Item Deleted CIM1 6.05 3.058 0.670 0.591 CIM2 6.10 3.514 0.558 0.722 CIM3 6.41 3.620 0.559 0.720 Table A5- 7Reliability test of products/services diversification factor Cronbach’s alpha = 0.670 Scale Mean if Item Scale Variance if Corrected Item- Cronbach's Alpha Deleted Item Deleted Total Correlation if Item Deleted SPD1 5.34 2.217 0.530 0.509 SPD2 5.45 2.762 0.412 0.662 SPD3 6.60 2.593 0.512 0.540 65 Table A5- 8Multiple linear regression R-Square = 0.509; F-Test = 33.395; p-value = 0.000 Model Unstandardized Standardized Coefficients Coefficients B Std Error (Constant) -.537 282 Reliability 088 040 Ease of use 233 Confidentiality and security t Sig Beta -1.904 058 111 2.187 030 035 335 6.554 000 190 041 242 4.637 000 Speed of responses 207 030 357 6.874 000 Continuous improvement 227 033 361 6.953 000 Products/services 152 038 204 4.037 000 diversification Table A5- 9Conclusion of hypothesis testing Hypothesis Content Conclusion H1 Reliability has positive effect on customer satisfaction Accepted H2 Ease of use has positive effect on customer satisfaction Accepted H3 Confidentiality and security has positive effect on Accepted customer satisfaction H4 Speed of responses has positive effect on customer Accepted satisfaction H5 Continuous improvement has positive effect on Accepted customer satisfaction H6 Products/services diversification has positive effect on Accepted customer satisfaction 66 ... research topic ? ?Factors affecting the satisfaction of customers to Internet Banking ofVietnam Joint Stock Commercial Bank for Industry and Trade (Vietinbank) - Ba Dinh Branch" hopes to contribute... evaluate the products that the bank provided is satisfactory or not Therefore, the study ? ?Factors affecting the satisfaction of customers to Internet Banking of Vietnam Joint Stock Commercial Bank for. .. impact on the formation of customer satisfaction 2.4 Reality of internet banking services by Ba Dinh branch 2.4.1 The development of internet banking services of Ba Dinh Branch Internet Banking: