The Impact of Electronic Banking on Customers Satisfaction …

1 Volume 5 Issue 2 1000174J Bus Fin AffISSN: 2167-0234 BSFA an open access journal Research ArticleOpen AccessWorku et al., J Bus Fin Aff 2016, 5:2 DOI: *Corresponding author: Milion Assefa Tafa, Master in MBA, Dashen , Sierra Leone St, Addis Ababa, Ethiopia, Tel: +251 11 466 1380; January 14, 2016; Accepted February 10, 2016; Published February 20, 2016 Citation: Worku G, Tilahun A, Tafa MA (2016) The Impact of Electronic Banking on Customers Satisfaction in Ethiopian Banking Industry (The Case of Customers of Dashen and Wogagen Banks in Gondar City). J Bus Fin Aff 5: 174. : 2016 Worku G, et al. This is an open-access article distributed under the terms of the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original author and source are , the spread of e- Banking is much limited.

2 As suggested by Claessens, Glaessner and Klingebiel, developing countries in general have an advantage as they can learn from the experience of advanced economies [4]. Today, almost all banks are adopting Electronic Banking as a means of enhancing service quality of Banking services . They are providing Electronic Banking to their Customers to increase Customers Satisfaction in Banking study by Kumbhar on customer Satisfaction towards e- Banking services of ICICI bank in Chennai, India, which considered factors affecting on customer Satisfaction : an empirical investigation of ATMs service and examined that the cost effectiveness of ATM service were core service quality dimension and it was significantly affecting on overall customer Satisfaction in ATM service provided by commercial banks [5].

3 Though there are few researches done about Electronic Banking in Ethiopia Electronic Banking is a useful topic to study how to make it applicable using the available Information Communication Technology infrastructures together with the existing financial and legal frameworks so that the quality of services in Ethiopian Banking Keywords: Electronic Banking ; Customers Satisfaction ; Ethiopianbanking industry; Dashen and Wogagen banks; Gondar cityIntroductionBackground of the study and the study areaCustomer Satisfaction is a measure of how products and services supplied by a company meet or surpass customer expectation.

4 customer Satisfaction is also defined as the number of Customers , or percentage of total Customers , whose reported experience with a firm, its products or its services (ratings) exceeds specified Satisfaction goals [1]. And yet another definition of customer Satisfaction is it refers to the extent to which Customers are happy with the products and/or services provided by a business. Further definition of customer Satisfaction is it is a term generally used to measure a customer 's perception of a company's products and/or services . It's not a straight forward science however, as customer Satisfaction will vary from person to person, depending on a whole host of variables which may be both psychological and physical.

5 The usual measures of customer Satisfaction involve a survey with a set of statements using a Likert Technique or scale [2].Technology is making a tremendous Impact upon service companies in general and the financial services sector is no exception. The application of information and communication technology concepts, techniques, policies and implementation strategies to Banking services has become a subject of fundamentals importance and concerns to all banks and indeed a prerequisite for local and global competitiveness in Banking industry. As a result of this technological improvement business environment in financial sector is extremely dynamic and experience rapid changes and demands banks to serve their customer electronically.

6 The evolution of e- Banking started from the use of Automatic Teller Machine (ATM) and Finland is the first country in the world to have taken a lead in e- Banking [3]. E- Banking has been widely used in developed countries and in developing economies; The Impact of Electronic Banking on Customers Satisfaction in Ethiopian Banking Industry (The Case of Customers of Dashen andWogagen Banks in Gondar City)Worku G1, Tilahun A1 and Tafa MA2*1 Faculty of business and economics (FBE), University of Gondar, Gondar, Ethiopia2 Dashen Bank , Sierra Leone St, Addis Ababa, EthiopiaAbstractThis study presents what Impact Electronic Banking has on customer Satisfaction in comparing with traditional brick and mortar Banking service, its relationship with that of age, occupation and education, its Impact on branch visits, the level of customer understanding about e- Banking and the opportunities and challenges of e- Banking .

7 The paper tried to see all the above among 402 properly filled and returned questionnaires of e- Banking Customers and interview with four branches of the two commercial banks which have started e- Banking service in Gondar city when this study was conducted. The study used tables, percentages, chi-square independency test to see the relationship between demographic characteristics and e- Banking , independency t-test to see the visits of branches before and after e- Banking by Customers is significant or not and regression analysis test has been conducted to explain the variables which determine Customers Satisfaction in e- Banking .

8 The results of the study implied t that majority of users of e- Banking are the young, the educated, salaried and students, business men and women are not actively using the service of e- Banking and there is also a relationship between e- Banking and demographic characteristics, e- Banking currently provided for saving and current accounts holders only, e- Banking has improved customer Satisfaction , reduced frequency of bank hall for Banking service, reduced waiting time for Customers , there are Customers who don t know the fee charged for being e- Banking users, the bank Customers Satisfaction increased after being e- Banking users, enabled Customers to control their account movements and there is high opportunity to expand e- Banking service in the of Business & Financial AffairsJournal of Business &Financial AffairsISSN: 2167-0234 Citation: Worku G, Tilahun A, Tafa MA (2016) The Impact of Electronic Banking on Customers Satisfaction in Ethiopian Banking Industry (The Case of Customers of Dashen and Wogagen Banks in Gondar City).

9 J Bus Fin Aff 5: 174. 2 of 18 Volume 5 Issue 2 1000174J Bus Fin AffISSN: 2167-0234 BSFA an open access journal sector can be enhanced for the future. Moreover Internet Banking has been widely studied in developed countries and also to some extent in developing countries but not in Ethiopia. Very few studies have been done in developing countries, and it has not been well investigated in Ethiopia. Customers in Ethiopia are late adopters of the Internet and its applications with regards to Electronic baking. It looks that Electronic Banking is facing difficulties in Ethiopia. Ethiopian Banking system is still underdeveloped compared to the rest of the world and Electronic payment systems are at an embryonic stage.

10 Among 15 commercial banks in Ethiopia very few of them are engaged with the diffusion of e-commerce. Moreover among several services of e- Banking , they arelimited to ATM service. Creating an Electronic Banking in Ethiopia isthe same as to building a web business for all who are participating inthe economy of the country. This leads the country to the electronicbusiness (e-business). The e-business, e-commerce is about usingelectronic techniques to create opportunities, create new markets, newprocesses and growth the creation of wealth using Electronic mediums[6]. The development of Ethiopian Banking system has largely beenaffected by the dominance of cash.