How To Test The Theory Of The Advantages Of Electronic Banking In Iran

Transcription

1 Investigating of the effect of E-Banking on Increasing of Bank revenues (Case Study:Iranian Private Banks) Mehdi Alinezhad Sarokolaei 1 Department of Accounting, Tabriz Branch, Islamic Azad University,Tabriz, Iran Akbar Rahimipoor Young Researchers Club, Sirjan Branch, Islamic Azad University, sirjan, Iran, akbarrazraz83@yahoo.com Samad Saraei Board of Direcotors, Institution of Javanan -e- Khayyer of Tabriz Zahra Vakilzadeh Sina Bank Clerk, Tabriz Emam Khomeyni Branch Abstract: The purpose of this study is investigating of the effect of E-banking on banks services fees and subsequent in revenue in the private banks in Iran between Data needed for research from banks financial statement and also questionnaire ghathered and then with using of multivariables regression and Pearson method were analyzed. In this research, services such as bank cards, ATM, P.O.S, Internet bank and Telephone bank as E-banking services are used. The results show that there is a significant relationship between E-banking and banks revenue as main hypothesis and also between E-banking and each of the above services as minor hypothesises. Finally, we can state that E-banking will increase the revenue of private banks in Iran. Keyword : E- banking, E-banking services, Bank fees, Private banks, Iran. 1. Corresponding author, mehdi12_may@yahoo.com

2 Introduction Nowadays the expansion of access to a world wide web called Internet has revolutionized communication all over the world in such a way that we can dare to claim that our world has never been exposed to such a speed in using a scientific phenomenon. The access of many people to the worldwide web of internet and the spread of electronic communications among individuals and different organizations through a virtual world has created a suitable situation to establish business and economical relations and gradually e-commerce is going to be more dominant. In developed countries of the world usually the negotiations between purchasers and sellers, purchase ordering, insurance supply, money transferring and are carried out electronically and goods transportation is done based on electronic demands. In this situation the supply of technological substructures needed for electronic banking is one of the fundamental requirements to realize this goal. Thus, we should say that using electronic systems in credit and financial entities of the world is considerably increasing and the number of electronic banking services is ever on the rise. Thus, there is no doubt that having an efficient banking system is one of the requirements of entering into international markets and membership in organizations such as world trade organization, in which it can enter carefully and rapidly and with an equal technology with the advanced banks of the world, to supply an efficient business for local manufacturers and consumers [3]. The magnificent development of information technology and its expansion into the world's money and banking markets has changed the current banking methods along with fostering the bank customers' affairs. Today, the customer judges banking affairs based on the capability amounts of the banks to help resolve the customers' problems and expand the trade [24]. Electronic banking acceptance is increasing in most countries in such a way that electronic banking relationships in pioneering countries is more than 50 percent [22]. The key factor in electronic banking acceptance is customers' reliance and satisfaction towards the bank which indirectly affects electronic banking acceptance. On the other hand, customers' participation in electronic banking acceptance is very important; because this can reduce or omit the interactions between an organization and the customers. The participation of the customers and the bank is a factor which affects service quality, satisfaction and finally customers' preservation. Meanwhile, many individuals are cautious regarding the use of new technologies [21]. Electronic banking involves systems which

3 enable the customers of financial entities to use bank services in three layers of informing, relations and interactions. Nowadays, and according to facilities and needs of electronic banking market some categories and subcategories are presented which include: internet banking, mobile-based banking and related technologies, telephone banking, fax-based banking, ATM-based banking, sales-terminals-based banking and electronic-branches-based banking. In pioneering banks, in electronic banking, different banking channels are combined and unified island systems emerge [3]. Literature review: Ebrahimi (2002) studied the obstacles of implementing electronic banking in Iran entitled: "Electronic banking implementation methods in Iran" [13]. Jorayo (2002) presented a paper in Romania about the requirements of implementing a successful electronic banking [9]. Bogdan (2003) presented an article entitled: "The obstacles and problems of implementing electronic banking". The main idea in this paper was the classification of obstacles in electronic banking development [5]. Heshmati-e-Molaee (2004), has studied the impracticality of modern financial tools development in Islamic systems without considering other suitable policies in a study entitled: "Modern banking tools and their position in Islamic banking systems". In our Islamic system, the new tools can have suitable status. It is found that developing new financial tools should be responsible against economic realities in one hand and observe Islamic norms in micro-approaches on the other hand in which there is no contradiction with consistent economical policy logic [11]. Alemi (2004) studied designing and implementation of a concise software system in banks in a paper entitled: "Designing and implementation of an electronic banking system (a virtual branch)" [2]. Koleini (2005) has investigated encoding tools in internet and electronic payment protocols in a research paper entitled: "Security in electronic paying systems" [16]. Babazadeh (2005) In his dissertation entitled: "Studying the obstacles for the creation and development of electronic banking in Iran by using a descriptive research method (questionnaire)", found out that since people lack enough knowledge about the advantages of

4 electronic banking, the legal structure to enter electronic environment is weak, the governmental structure for specialized and business banks is not appropriate, weakness in substructures is felt, there is a low demand level for electronic banking and electronic banking services are presented insufficiently electronic banking has not developed sufficiently in Iran [6]. Feizi & et al (2005) presented the concepts and services of electronic banking first, and then tried to identify and set a preference continuum for factors and obstacles of creating and developing electronic banking in Iran in a paper entitled: "Factors and effective obstacles in creating and developing electronic banking in Iran" [7]. Ming & et al (2005) investigated about factors such as bank size, external pressures, realized profits and information technology maturity on electronic banking development in a paper entitled: "Studying the role of joining World Trade Organization on employing electronic banking" [19]. Hamidizadeh & et al (2007) have tried to identify and rank the factors which stimulate and foster electronic banking development and also identified and ranked the challenges and bottlenecks of external environments in electronic banking system in our country in an article entitled: "Studying preparatory factors, challenges, and bottlenecks of electronic banking development" [10]. Klayous & et al (2007) classified the factors into two categories of soft and tough and tried to measure their effects in an article about effective factors in electronic banking development [15]. Tommy Laiconen (2007) composed a paper entitled: "The comparison of perceived value of internet and mobile banks by customers among account pays services". In his research he concluded that the efficiency, easiness and security are the most important demands which differentiate the customers' perceived values of internet bank and mobile bank and security is the main concern [17]. Nematipour (2008) has tried to identify development requirements and key factors of success in electronic banking in Iran in an article entitled: "Identifying development requirements and consistent success factors (C.S.F.)".[20]

5 Pormirza & et al (2008) studied and assessed CRM in Saman Bank in a research paper entitled: "Management of relationships with customers in electronic banking industry in Iran" [20]. Teo & Lin (2009) presented a paper in Singapore about acceptability or lack of acceptability of electronic purchase. In this research the relationships between several different factors about electronic purchase acceptability have been investigated [25]. Amadeh & et al (2009) studied and identified the main obstacles in developing electronic banking in private banks of Iran in an article entitled: "Studying the obstacles and resolutions for developing electronic banking in private banks of Iran" [4]. Research hypotheses: Since electronic payment tools include ATM, bank card and sales terminal and branch terminals, so, the number of ATM machines, the number of cards issued, the number of sales terminals (P.O.S.), internet bank and telephone bank are considered to be independent variables and maximization of bank revenue is considered to be our dependant variable. Thus, the research hypotheses are classified into a main hypothesis and 5 minor hypotheses as follows: Main Hypothesis: "There is a significant relationship between electronic banking and increasing bank services' fee." Minor Hypotheses: 1- There is a significant relationship between bank cards and bank services' fee. 2- There is a significant relationship between ATM machines and bank services' fee. 3- There is a significant relationship between P.O.S machines and bank services' fee. 4- There is a significant relationship between internet bank and bank services' fee. 5- There is a significant relationship between telephone bank and bank services' fee.

6 Research Domain The subject domain of this research involves the study of electronic banking's role in increasing bank services' fee. Regarding the location and time span, this research includes all branches of private banks during the years 2009 to Research methodology and data collection method Research method in this study is quantitative, descriptive and measuring. To collect data used in this research, library study (including devices such as books, articles and dissertations) and field study (distributing questionnaires and interviewing banking system staff and statistics gathered about the number of ATM machines, ATM cards, telephone bank, Internet bank and P.O.S machines) and supplying statistical tables and comparing and analyzing the tables and referring to beneficiary organizations and interviewing banking scholars also have been utilized. It is worth to note that the interviews were limited and only have been presented to identify suggestible criteria in each of the hypotheses. We have collected and then compared and finally analyzed the data about revenues and interests of private banks through the study of financial statements in these banks and also other statistics and data related to the number of cards issued and the number of ATM machines and by using statistics and data published by the central bank. Testing research hypotheses by using multi-variable regression The regression model data were collected from the central bureaus of bank offices and by they were analyzed by using a multi-variable regression model which is shown in the following tables. 1- The summary of multi-variable regression model to identify bank fee (revenue) R R Square Adjusted R Square Anticipation error Sig

7 2- Effects' coefficients of the identifying model of bank fee (revenue) Variable Non-standard effect coefficient (B) Standard effect coefficient (Beta) t-value Sig ) significant level( ATM machine ATM card P.O.S internet bank telephone bank Table 1, is a multi-variable regression analysis which involves the different dimensions of electronic banking. What has been presented in the table shows that the independent variables of the model have had a concurrently co-efficiency of with dependant variable. Also it has been shown that these variables can describe 54 percents of the changes in the amount of fee (revenue) of bank services. Also according to table 2, all 5 variables related to different dimensions of electronic banking (ATM machine, ATM card, P.O.S machine, Internet bank, and telephone bank) have significant effects on the fee or revenue of banking services. (Sig<0.05) Testing research hypotheses by using questionnaire data By using Kokran's model, a sample group of 147 persons from among our statistical society were selected and questionnaires were distributed among them. The questionnaire for this research involved 42 questions which were divided between the variables as follows: ATM machines: 8 questions, ATM cards: 7 questions, internet bank: 6 questions, telephone bank: 5 questions, P.O.S machines: 8 questions, bank fee (revenue): 8 questions. In order to the relationship between the two variables, Spearman's test has been used. Testing the main hypothesis of the research Regarding the attained results after using SPSS software, electronic banking (ATM machines, bank cards, internet bank, telephone bank and P.O.S machines) has a positive relationship

8 with the bank's revenues with an assurance level of %99. This relationship is positive and its level is strong and equals The number shows the dependence amount between electronic banking and the bank's revenues based on Pearson's test. When this number is closer to 1, there is a stronger relationship between these variables. Also the amount of the relationship between electronic banking variable (ATM machines, bank cards, internet bank, telephone bank and P.O.S machines) and bank's revenues was studied by using Spearman's test. The resulted findings showed that there is a significant relationship of between these variables. Testing minor hypotheses of the research In this part of the research, we tested the dual relationships between bank's revenues and each of the 5 variables of ATM machines, bank cards, internet bank, telephone bank and P.O.S machines one by one. Table 6 shows the results of these hypotheses. Hypothesis 1 - There is a significant relationship between bank cards and bank services' fee. The results of SPSS software show that the statistical result of test equals t=7.65 and since the amount of sig is Sig > α, H 0 is rejected and H 1 is approved. This means that the relationship between bank cards and fees (bank's revenue) is a significant one. But according to Pearson's test there is an average relationship between these variables. Hypothesis 2 - There is a significant relationship between ATM machines and bank services' fee. An automatic teller machine (ATM) can act as a bank branch and carry out many banking activities through which a magnificent part of exchanges can be done with the least human force interference. The results of SPSS software show that the statistical result of test equals t=7.65 and since the amount of sig is Sig > α, H 0 is rejected and H 1 is approved. This means that the relationship between ATM machines and fees (bank's revenue) is a significant one. In this relationship there is a %1 error and regarding the strength, it is considered to be an average relationship and its amount based on Pearson's test equals Hypothesis 3 - There is a services' fee. significant relationship between P.O.S machines and bank

9 The results of analyzing this hypothesis by the help of a multi-variable regression test show that the statistical result of test equals t=6.46 and since the amount of sig is Sig > α, H 0 is rejected and H 1 is approved. This means that the relationship between sales terminal and fees (bank's revenue) is a significant one. Hypothesis 4 - There is a significant relationship between internet bank and bank services' fee. The results of analyzing this hypothesis by the help of a multi-variable regression test show that the statistical result of test equals t=4.66 and since the amount of sig is Sig > α, H 0 is rejected and H 1 is approved. This means that the relationship between internet bank and fees (bank's revenue) is a significant one. Hypothesis 5 - There is a significant relationship between telephone bank and bank services' fee. The results of analyzing this hypothesis by the help of a multi-variable regression test show that the statistical result of test equals t=5.91 and since the amount of sig is Sig > α, H 0 is rejected and H 1 is approved. This means that the relationship between telephone bank and fees (bank's revenue) is a significant one. Conclusions Studying information technology in world banking industry shows that if we use modern electronic systems in banking, we will face a great deal of reduction of costs in each of the exchanges. It means that if we develop the culture to use internet systems and use electronic banking instead of the traditional banking, the costs will be cut down intensively. Using information technology in banking industry increases capital security and time savings, besides reducing risks in managerial decision-makings and increases optimal use by improving bank services in this part and will end in growth and economic blooming in other parts. In this research we studied the effects of electronic banking on increasing revenues in private banks in Iran. In order to measure electronic banking criteria, we referred to 5 current services in the present era as follows: ATM, bank cards, internet bank, telephone bank and P.O.S machines. By utilizing a multi-variable regression and also the related statistical tests, our results showed that there is a significant and positive relationship between electronic

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