Abstract
This study focused on investigating the role of E-banking on the switching behaviour of retail bank clients in Polokwane, South Africa. Recently, studies have shown that people are switching banks more often than in the past. Circumstances that are beyond control cause people to switch. This has become a challenge in the banking industry as many banks lose their clients. However, newly developed technologies have brought many changes in the operation of banks. The new E-banking services have enabled bank clients to have access to their bank account for 24 hours without visiting the physical branch. A sample of 98 respondents was surveyed in Polokwane, South Africa using the convenience sampling technique. The cronbach alpha test was used to ascertain reliability of the findings. The findings reveal that demographic characteristics have much impact on the switching behaviour of commercial bank clients and acceptance of e-banking services. Switching factors such as bank charges, low interest rates on savings, promotion activities, location and switching costs were the major reasons for bank customers to switch banks.
Highlights
Within the contemporary business environment, the propensity of financial service consumers switching service providers has significantly increased - buoyed by the competitive pressures arising from the deregulation of the banking sector by individual economies from the early 1980’s to present day, economic integration associated with globalisation and more pertinently, advances in information and communication technology - ICT (Clemes, Gan & Zheng, 2007; Kura, Mat, Gorondutse, Magaji & Yusuf, 2012; Wu, 2005)
From the results shown above, each statement on what e-banking does for retail commercial bank clients has a p-value< 0.05 meaning H0 is rejected and it can be concluded that e-banking does play a significant role on customers’ bank switching behavior
From the results shown above, each statement on what banks provide through e-banking services for retail commercial bank clients has a p-value< 0.05 meaning H0 is rejected and it can be concluded that e-banking does play a significant role on customers’ bank switching behavior
Summary
Within the contemporary business environment, the propensity of financial service consumers switching service providers has significantly increased - buoyed by the competitive pressures arising from the deregulation of the banking sector by individual economies from the early 1980’s to present day, economic integration associated with globalisation and more pertinently, advances in information and communication technology - ICT (Clemes, Gan & Zheng, 2007; Kura, Mat, Gorondutse, Magaji & Yusuf, 2012; Wu, 2005). The utilisation of internet-based services and products within the South African banking sector is extensive and has been found to have a critical impact on the consumer behaviour of bank clients (Gouws, 2012; Redelinghuis & Rensleigh, 2010; Wu, 2005). This shift in consumer behaviour includes the subject matter of this paper, customer switching behaviour. It is with this in mind that this study was conducted, to establish the impact of e-banking on the switching behaviour of retail banking clients of commercial banks within the Polokwane City locale, which is the provincial capital of Limpopo Province, South Africa
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