customer perceptions on security: a...
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CUSTOMER PERCEPTIONS ON SECURITY: A
COMPARATIVE STUDY BETWEEN
UNITED KINGDOM AND NIGERIA
A study submitted in partial fulfilment of the requirements for the degree of
Masters of Science in Information Systems Management
at
THE UNIVERSITY OF SHEFFIELD
Department of Information Studies
by
090125476
FATIMA LAWAN GUBA
Supervisor: Professor Val Gillet
September 2010
Abstract
Background: The research presents a gap between a developed country and a developing
country (i.e. United Kingdom and Nigeria) in terms of adopting internet banking. As a result,
the research attempted to critically assess those gaps and explored the perceptions of internet
banking customers in terms of security, usability and level of acceptance.
Aims: The study aimed to investigate customer perceptions on security in internet banking. It
specifically compared the perceptions of Nigerian customers living in the United Kingdom.
Methods: Questionnaire was developed and administered in Sheffield to a sample of 99
postgraduate students. The questionnaires were first piloted with 10 participants and the
modified questionnaires were distributed around the university campus. There was a total of
82 percent response rate, which was considered to be a success. In an attempt to fulfill the
remaining objectives, an extensive literature review was done.
Results: Findings reveal that British banks operate at a more advanced level than Nigerian
banks. Precisely, 45.78 percent of the participants perceive security to be of great concern.
The main reason for concern, as revealed by 80.49 percent of the participant was that; they
are afraid of being exploited by Cybercriminals. Of the 83 participants, only 31.3 percent
reported victims of internet fraud. However, of the 31.3 percent victims, only 4.8 percent
stopped using internet banking. The result also found that; participants are more willing to
provide sensitive information such as credit/ debit card details online or over the telephone in
the UK as opposed to Nigeria.
Conclusions: It is concluded that; internet banking customer in the UK are more inclined to
carry out financial transactions online and are less concerned about security than customers in
Nigeria. Although, limited to a small number of Nigerians living in Sheffield, it is believed
that the aim of this research has been reached. Thus, further research could explore the
business perspective, that is, bank perceptions on security. Also, a more extensive survey and
a larger sample size would be desirable.
Acknowledgement
First of all, I owe my eternal gratitude to Almighty Allah for my postgraduate year at the
University of Sheffield.
Secondly, I would like to express my gratitude to my supervisor, Professor Val Gillet whose
kind assistance and valuable support contributed to the successful completion of this
dissertation.
Thirdly, I would like to thank my personal tutor, Dr. Mark Sanderson for his assistance in
determining this topic.
Also, I would like to thank my parents for their love and support all through my postgraduate
year.
I am particularly grateful to my brother, Mohammed for his timely assistance and constant
motivation and my sister, Aisha for her support.
Lastly, I would like to thank all the participants who agreed to give up their valuable time to
take part in this study and my friends for being very supportive.
Table of Contents Abstract ................................................................................................................................................... 1
Acknowledgement .................................................................................................................................. 1
List of Figures ......................................................................................................................................... 3
List of Tables ...................................................................................................................................... 4
1. Introduction ..................................................................................................................................... 5
1.1 Research Background ............................................................................................................. 5
1.2 Research Aims and Objectives ............................................................................................... 7
1.3 Summary and Dissertation Outline ......................................................................................... 9
2. LITERATURE REVIEW ............................................................................................................. 11
2.1 Introduction ........................................................................................................................... 11
PART ONE: INTERNET BANKING .................................................................................................. 11
2.2 Overview of the Internet ....................................................................................................... 11
2.3 The Emergence of Internet Banking ..................................................................................... 12
2.4 Internet Banking Defined ...................................................................................................... 13
2.5 Types of Internet Banking Products & Services ................................................................... 14
2.6 Factors that Influence Internet Banking Adoption ................................................................ 14
2.7 Advantages and Disadvantages of Internet Banking ............................................................ 15
PART TWO: INTERNET SECURITY ................................................................................................ 16
2.8 Internet 'Online' Security Defined ......................................................................................... 16
2.9 Overview of Internet Banking Security ................................................................................ 17
2.10 Types of Security Breaches ................................................................................................... 17
2.11 Types of Security Measures .................................................................................................. 18
2.12 Internet Security in UK and Nigeria ..................................................................................... 19
2.13 Customer's Perceived Risk and Trust .................................................................................... 20
2.14 Summary ............................................................................................................................... 21
3. METHODOLOGY ....................................................................................................................... 23
3.1 Introduction ........................................................................................................................... 23
3.2 The Research Approach ........................................................................................................ 23
3.3 Research Method .................................................................................................................. 23
3.4 Data Collection ..................................................................................................................... 25
3.4.2 Sampling ....................................................................................................................... 26
3.4.3 Literature Review .......................................................................................................... 27
3.5 Data Analysis ........................................................................................................................ 27
3.6 Ethical Issues ........................................................................................................................ 27
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3.7 Summary ............................................................................................................................... 28
4. ANALYSIS OF RESULTS .......................................................................................................... 29
4.1 Introduction ........................................................................................................................... 29
4.2 Questionnaires ....................................................................................................................... 29
4.3 Method of Analysis ............................................................................................................... 29
4.4 Survey Results ...................................................................................................................... 30
4.5 Internet 'Online' Banking ...................................................................................................... 31
4.6 Security and Internet banking ............................................................................................... 36
4.7 Internet Banking in Nigeria and UK ..................................................................................... 44
4.8 Customers Perceptions and Attitudes towards Internet Banking .......................................... 48
4.9 Summary ............................................................................................................................... 54
5. DISCUSSION OF FINDINGS ..................................................................................................... 56
5.1 Introduction ........................................................................................................................... 56
5.2 Internet Banking Services in UK and Nigeria ....................................................................... 56
5.3 Level of Internet Banking Acceptance .................................................................................. 57
5.4 Customers' Behaviours and Concerns towards Internet Banking ......................................... 58
5.5 Customers' Perceptions on Security ...................................................................................... 58
5.6 Summary ............................................................................................................................... 59
5. CONCLUSIONS, LIMITATIONS AND SUGGESTIONS ......................................................... 60
5.1 Conclusions ........................................................................................................................... 60
5.2 Limitations of Study ............................................................................................................. 62
5.3 Suggestions for Future Research ........................................................................................... 62
APPENDICES ...................................................................................................................................... 63
Appendix I: Information Sheet ............................................................................................................. 63
Appendix II: Questionnaire ................................................................................................................... 64
BIBLIOGRAPHY ................................................................................................................................. 72
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List of Figures
Figure 4.1: Frequency at which customers use internet banking 32
Figure 4.2: Reasons for banking online 33
Figure 4.3: Reasons for banking online 35
Figure 4.4: Level of security concerns as perceived by customers 37
Figure 4.5: Reasons for Security Concerns as Perceived by Participants 38
Figure 4.6: Banks approach to resolving internet fraud issues 41
Figure 4.7: Level of customer satisfaction 42
Figure 4.8: Difference in Internet Banking System of Nigeria and UK as 44
perceived by customers
Figure 4.9: Level of website interactivity (UK & Nigeria) 45
Figure 4.10: Customers' willingness to provide credit/debit card details 48
over the internet in the UK
Figure 4.11: Customers' willingness to provide credit/debit card details 49
over the internet in Nigeria
Figure 4.12: Customers feel more secure banking in the UK as compared to Nigeria 51
Figure 4.13: Customers consider themselves to be at risk while banking online 52
Figure 4.14: Security is the main issue affecting Nigeria's internet banking system 53
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List of Tables
Table 4.7: Responses on user name and password 30
Table 4.6: Responses on bank security 31
Table 4.8: Responses on security measures 34
Table 4.5: Percentage of Respondents Who Disengaged in Internet Banking 38
Table 4.4: Number of Respondents Affected by Internet Fraud 39
Table 4.3: Frequency at which customer's visit their bank branch 43
Table 4.2: Age of Respondents 43
Table 4.1: Respondents' Gender 43
Table 4.9: Similarities in internet banking system of Nigeria & UK as perceived 45
by customers
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CHAPTER 1
1. Introduction
In this chapter, the research focus is presented, which attempts to explain the reasons and
motivation for conducting this research. It also gives an insight into the background of the
research topic by asking questions and deriving from the questions, the aims and objectives
for carrying out this research.
1.1 Research Background
The development of information technology (I.T) and the subsequent evolution of the internet
have greatly affected the way organizations run their business. Most businesses are now fully
dependent on the internet and other technological tools. The banking industry is certainly one
of them. In recent years, the rapid growth of internet banking has transformed the traditional
method of banking to a great extent. Practically, most major banks have adopted internet
banking mainly because it allows them to serve much more customers than by traditional
banking at a lower cost (Mannan, 2008). Consumers have come to embrace internet banking
primarily because of convenience, ease of accessibility (i.e. 24/7 service), speed of
transaction, reduced service charge, reduced wait in-lines among many others. However,
even with these countless benefits, the adoption of internet banking has been rather slow
especially in the developing countries.
The gap between the developed countries and the developing countries could not be over
emphasized. The term "digital divide" is used to describe the inequality in internet access.
Thus, this difference in the use of internet and the level of technology adoption is believed to
have been caused by the enormous gap in telecommunication infrastructure (Castells, 2001).
Evidently, most developing countries have little resources to keep pace with the changing
technology. This is a major issue because we live in an information age, where almost all
organizations need to transform their current business strategies in order to establish a web
presence and make efficient use of the internet to stay abreast and on top of their resources.
As a result, banks in developing countries are now striving to embrace internet banking albeit
with inadequate resources. Several findings reveal that internet banking in the developed
countries operates at a more advanced level as compared to developing countries.
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As a developing country, Nigeria was depicted as one of the fastest growing in
telecommunication in Africa, but rather slow at adopting internet banking practices. Presently,
all banks in Nigeria have established an electronic presence. In 2003, the guidelines for
internet banking were introduced thereby causing serious reformation in the banking industry
and in June 2004, the reformation in effect left Nigeria with only 25 banks against the 89 that
were previously in place (Aderonke and Charles, 2010). However, these changes have been
made in anticipation to reach global standards and to resolve a number of other factors
including; increased demands from customers, better service delivery and to achieve a
competitive advantage (Aderonke and Charles, 2010). In 2008, there had been N360 billion
(Nigerian Naira) worth of internet payment which was perceived to be huge progress since
the emergence of internet banking in Nigeria.
On the other hand, United Kingdom (UK) has one of the most diverse and competitive
banking sectors. Consequently, UK banks have placed their customers as top priority and a
key to achieving competitive advantage. Thus, UK became one of the early adopters of
internet banking in Europe. A research indicated that; in 2006 there were approximately 17
million internet banking customers in the UK (Alsajjan and Dennis, 2008). Today, this
number has exceeded immensely. UK banks are transaction enabled and hence offer
advanced services such as credit cards, mortgage, insurance and loans over the web to their
online banking customers. However, customers are still hesitant in fully embracing the
internet banking system mostly because of factors like security. Despite the fact that UK
banks are technologically advanced, security still remains an issue.
Online security is a major issue affecting both the technologically advanced and the less
advanced countries particularly, in the area of internet banking. In Nigeria, there have been
several cases of cyber crimes in recent years. Popular cyber crime well-known to Nigerians is
the "phishing scams" in which cyber criminals use real looking but deceptive websites to
exploit their victims by asking them to input sensitive information into the website. The rapid
increase in illegal activities performed online is viewed as the consequence for the emergence
of internet banking. However, the issue of security have not been so prominent in the UK
although, internet security breaches are quite inevitable anywhere in the world.
Several findings elucidate a huge gap in the use of internet banking services of Nigeria and
UK. This has raised a level of curiosity as to whether the gaps are as a result of customer's
perceived risk and trust in conducting internet banking or are caused by lack of awareness.
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Research shows that Nigerians are more concerned about security than British as the country
is notorious for corruption and illegal activities. This raises the question of whether customers
in Nigeria are more aware of security issues than those in the UK because they live in an
environment that has bad reputation for cyber crimes or is it because the banks in Nigeria
lack advanced security technologies. Moreover, there is quite an abundance of literature in
this area but the problem is that, not much research has been conducted in relation to internet
banking security. This is an opportunity to add something new and insightful to this field.
This research focuses on exploring customer perceptions on security in internet banking. It
compares the perceptions of Nigerian customers living in the UK. This is mainly because,
Nigerians in the UK have had the opportunity to experience both banking systems thereby,
building a more accurate and adequate basis for comparison. The research will then attempt
to answer the following questions: (1) what are the customers' perceptions on security in
internet banking in UK and Nigeria? And (2) what are the similarities and differences in their
behaviour and concerns?
The two questions can be subdivided into the following questions:
What is internet banking?
What is security in the context of internet banking?
How do internet banking customers perceive security?
What are the similarities and differences in their perceptions?
1.2 Research Aims and Objectives
The overall aim of this research is to carry out a comparative study between a developed
nation and a developing nation i.e. United Kingdom and Nigeria. This research seeks to
investigate the different perceptions of internet banking customers on security and risk of
banking online and to evaluate, if any, the similarities and differences that exist between the
two countries. Within the overall aim of this research, there are a number of objectives that
are required to be fulfilled.
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The following are the set of objectives that this research will attempt to accomplish:
1. What are the customers' perceptions on security in internet banking in UK and Nigeria?
a. Clarify and define the term internet banking
b. Define the term 'internet' or information security
c. Identify types of internet security breaches that may affect internet banking
customers
d. Examine the security measures available to banks
e. Identify and discuss the positions of UK and Nigerian banks towards customer
trust
f. Identify customer perceptions on security in internet banking
g. Assess customer behaviour and concerns towards internet banking
2. What are the similarities and differences in their behaviours and concerns?
h. Evaluate the similarities that exist between UK and Nigerian internet banking
systems
i. Evaluate the differences that exist between UK and Nigerian internet banking
systems
The initial objective 'a' provides a clear meaning and general overview of internet banking.
This present the background knowledge of the research environment including the types of
internet banking services offered in banks and the advantages and disadvantages of banking
online. It is established in the literature review section.
The preceding objectives 'b' 'c 'and 'd' is to define and explain the meaning of internet
security in the context of internet banking. Specifically, it identifies the different internet
security breaches that exist within the broader area of internet banking and then examines
security measures that are available for protection against those breaches. This will attempt to
scrutinize various bank sites to identify the kind of security measures used and also research
useful literatures pertaining to this subject.
Subsequently, the objective 'e' will try to identify via useful literature, the position of UK and
Nigerian banks towards customer trust. That is, an extensive literature review will endeavour
to gather various views and approaches on how banks perceive customer trust and what they
are willing to do in order to gain customer loyalty.
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Lastly objectives 'f' 'g' 'h' and 'i' will seek to identify customer perceptions on security in
internet banking, their behaviours and concerns towards internet banking and then evaluates
the similarities and differences in their behaviours and concerns. Also, the similarities and
differences of the two banking systems will be assessed. For this part, primary data in the
form of questionnaires is collected following a quantitative research approach.
1.3 Summary and Dissertation Outline
The entire dissertation is covered in six chapters. Chapter one introduces the research
backgrounds, aims and objectives.
Chapter two presents the literature review which provides the general knowledge and the
theoretical background related to the research topic. This chapter is divided into two parts:
part one provides a brief overview of the internet as a whole and how internet banking
emerged in the two countries being explored (that is, UK and Nigeria). More particularly, the
great transformations that the evolution of internet banking has brought and how it greatly
influences today's businesses are discussed. Secondly, a general definition of internet banking
and the types of products and services used are provided, in anticipation to fulfilling the first
research objective. Lastly, the factors that influence the adoption of internet banking both for
banks and their customers are reviewed. Additionally, the benefits and drawbacks for banking
online are presented, both in the banks perspectives and the customers' perspectives as well.
The second part of chapter two is established in anticipation to fulfilling research objectives
'b' through 'e'. It commences by defining security in the context of internet banking then
providing an overview of internet banking security. In addition, this part also provides the
different types of internet security breaches that may affect online banking customers and the
type of measures that can be taken in prevention of such breaches. Finally, a brief
introduction to internet security in the UK and Nigeria is discussed providing history of
security breaches that have occurred in past years.
The methodology for the research is presented in chapter Three. This gives an outline of the
framework for collecting and analyzing data used in the study. The research approach, the
method for data collection and the techniques used in analysing the data are examined.
Furthermore, ethical issues are also discussed.
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Chapter four provides a clear presentation of the results obtained from the study using
graphical techniques and tabulations. Results are analyzed using sophisticated computer
software for quantitative research known as SPSS (Statistical Package for Social Sciences).
The results obtained are then discussed in chapter five. This chapter reports the findings of
the study. Particularly, thorough discussions of the results relevant to the research objectives
are established.
Chapter six provides an overall conclusion to the findings and suggestions for further
research opportunities. In addition, the limitations of this research are also discussed.
The remainder of the dissertation includes: the appendices and the bibliography. The
appendices contain a copy of the questionnaires used in data collection, the glossary of terms
and other relevant information pertaining to the study. And the bibliography contains all the
source material used for the successful completion of the dissertation.
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CHAPTER 2
2. LITERATURE REVIEW
2.1 Introduction
In this chapter, the theory and background of the research is presented. The literature review
provides a general knowledge about the research topic and has been established to fulfil the
following objectives:
Clarify and define the term internet banking
Define the term 'internet' or information security
Identify types of internet security breaches that may affect internet banking customers
Examine the security measures available to banks
Identify and discuss the positions of UK and Nigerian banks towards customer trust
This chapter is divided into two major parts; part one discusses internet banking in general.
It specifically, provides an overview of the internet and then describes the emergence of
internet banking in both Nigeria and UK. It also presents the several types of internet banking
products and services; factors that influence internet banking and the advantages and
disadvantages of internet banking. Part two presents the primary topic of the research, which
is security in the context of internet banking. It addresses the various security breaches that
may affect online banking customers and the types of security measures that might help in
preventing those breaches.
PART ONE: INTERNET BANKING
2.2 Overview of the Internet
The internet was first introduced in the 1960s, then became well known as the World Wide
Web in the 1990s (Castells, 2001). Over the years, the internet advanced from basic transfer
of information across network of computers, usually via email to now offering a wide range
of services (Tan and Teo, 2000). Recent literature shows that the internet comprises of more
than 5,000 individual computer networks in over 70 countries (Weis, 2010). Every year, the
number of worldwide internet networks doubles (Weis, 2010). The continuous adoption of
the internet by businesses and individuals has lead to the belief that, the world is now a global
village and the internet a "resource for global" advancement (Ngini et al, 2002). Castells
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(2001) described the internet as "the fabric of our lives". Therefore, the internet is now
regarded as a key resource for economic growth (Ngini et al, 2002).
2.3 The Emergence of Internet Banking
Over the past decade, the development in information technology has lead to the evolution of
internet banking in the banking sector (Wong et al, 2009). The advancement of the internet
and the subsequent growth in internet banking has drastically transformed the traditional
banking system and the way consumers carry out their banking activities (Sayar and Wolfe,
2007; Eriksson et al, 2008). Internet banking enables customers to perform a wide range of
transactional services electronically via the bank's website (Gabner-Kräuter and Fraullant,
2008). The benefit for the customers, as compared with the traditional banking system, ranges
from faster service to ease of accessibility and low service charge (Unsal and Movassaghi,
2001; Gabner-Kräuter and Fraullant, 2008; Wong et al, 2009). While for the banks, internet
banking has reduced operational costs by cutting back physical facilities and staffing, and
increase sales as a result of reduced waiting times in branches and facilitated global reach
(Wong et al, 2009).
In the UK, internet banking was first introduced in 1997 and has since become widespread
thus, presenting a more developed internet banking infrastructure and a greater possibility for
acceptance by customers (Gerrard et al, 2006; Sayar and Wolfe, 2007). In 2006, online
banking customers in the UK increased to 17 million as compared to the 6.2 million in 2001
(Alsajjan and Dennis, 2008). This rapid adoption of internet banking system by British
consumers was predicted to be as a result of the high level of internet penetration. Broadband
penetration in the UK had risen from 5.3 percent in 2003 to 7.4 percent in June 2004 (Sayar
and Wolfe, 2007).
On the other hand, Nigeria's banking industry introduced the guidelines for electronic
banking for the first time in 2003 (Aderonke and Charlse, 2010) while, the actual internet
banking was adopted in 2007. The introduction of the guidelines led to a serious reformation
in the banking industry and in June 2004, the reformation in effect left Nigeria with only 25
banks against the 89 that were previously in place (Aderonke and Charles, 2010).
Currently, all banks in Nigeria have adopted information and communication technology
(ICT) as the basis for delivering effective and efficient financial services (Aderonke and
Charlse, 2010). According to Idowu, Alu and Adagunodo (2002), Nigerian banks have
realized that only by adopting information technology will they gain competitive advantage
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over their competitors. And most customers' choice of bank greatly depends on the banks'
implementation of E-Business (Salawu and Salawu, 2007). In their research, Chiemeke,
Evwiekpaefe and Chete (2006) found that internet banking in Nigeria is operated at a basic
level of interactivity, with most banks' websites providing mainly information with little or
no transactional services. In 2002, of 89 banks in Nigeria, only 17 (19.1%) were offering
basic internet banking services (Chiemeka et al, 2006; Ezeoha, 2005). While, 24 were
offering basic telephone banking services, only 7 provided ATM services (Ezeoha, 2005). It
has been concluded that internet banking in Nigeria "is still at the basic informative stage"
(Ezeoha, 2005).
2.4 Internet Banking Defined
Internet banking, also known as 'online banking' or 'electronic banking' (e-banking) is a
means of conducting financial transactions electronically via the bank's website (Tan and
Teo, 2000; Sayar and Wolfe, 2007). Internet banking enables fast and efficient delivery of
banking services to a larger number of customers anytime, anywhere at a reduced cost as
compared to the traditional method (Sayar and Wolfe, 2007; Egwali, 2008; Mannan, 2008).
Usually, internet banking means using a computer to access and conduct banking activities on
the internet however, it also implies the use of mobile phones, digital TVs etc. for accessing
the bank's website (also known as internet branch) (Sayar and Wolfe, 2007). According to
Sayar and Wolfe (2007), a bank's website providing only basic inquiry and information
services such as checking account statements but not transactional services like fund transfer
etc. does not qualify as an internet banking site or branch.
Ordinarily, internet banking and electronic banking have come to mean the same thing. Thus
there may be slight difference in the meaning of the two terms. Electronic banking (or e-
banking) refers to the overall term used to describe online or internet banking and other forms
of activities performed electronically. Kanellopoulos, (2002) defined electronic banking as
"the execution of banking operations via electronic channels, without the use of a physical
branch". Electronic banking takes four major forms including PC banking; Telephone
banking; Mobile banking and other channels such as automated teller machine (ATM)
(Kanellopoulos, 2002). Another channel for delivering electronic banking services is the
"internet-only bank" (also called virtual or branchless bank) (Sayar and Wolfe, 2007).
Internet-only bank is a name given to banks that do not have a physical space or traditional
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branch but offer internet banking services and other forms of transactions via ATMs (Sayar
and Wolfe, 2007).
2.5 Types of Internet Banking Products & Services
According to Perumal and Shanmugam, (2004) there are three types of internet banking:
Information: This type of internet banking provides products and services to
customers only at a basic level. That is, the bank's website only provides information
and enquiry services.
Communication: The internet banking website, in this case, allows customers to
interact with the bank's system. It allows the customers to send and receive emails,
apply for loan, check account balance and statements and update details.
Transaction: This type of internet banking enables customers to carry out
transactions including paying bills, transferring funds, accessing accounts etc.
2.6 Factors that Influence Internet Banking Adoption
Shinghal and Padhmanabhan, (2008) indicated that factors like convenience, flexibility,
reliability, time, transaction cost, real time access, bill payment, security, speed, ease of use
and friendliness of bank's websites, anywhere/anytime access, ability to view current and
historical data, fund transfer and queue management are the main factors that influence the
adoption of internet banking by customers.
On the other hand, Internet banking simplifies things for banks by assigning to customers
those tasks that bank staff perform traditionally behind the counter and this save both time
and minimizes errors that are likely to occur when the staff are dealing with customers'
transactions (Jayawardhena and Foley, 2000). A study reported that external factors such as
number of banks adopting internet banking, customer demand and availability of certain
technology tools are among the many reasons that influence the adoption of internet banking
(Sayar and Wolfe, 2007). However, Jayawardhena and Foley, (2000) identified that the
factors that influence banks to adopt internet banking include cost savings; increased
customer base; enhanced mass communication; marketing and communication; innovation;
and the development of non-core business.
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A non-cash payment costs eleven (11) times more at a physical branch than on the internet
(Jayawardhena and Foley, 2000). Banks could cut cost through better organization of
workforce, equipments and effective management of space and operational costs
(Jayawardhena and Foley, 2000). Secondly, Customer base is increased by attracting new
customers and retaining existing ones (Jayawardhena and Foley, 2000). Thirdly, mass
communication is achieved through customizing information to suite the customers' needs
and is actually referred to the idea that customers perceive service offered to them is
personalized to their own taste (Jayawardhena and Foley, 2000). Subsequently, the
development in internet technologies has open doors for banks to create and deliver
innovated products and services. And lastly banks are now developing non-core businesses
such as insurance and stock brokerages to increase their services.
2.7 Advantages and Disadvantages of Internet Banking
Internet banking offers great benefits to both banks and their customers (Aderonke and
Charles, 2010). It presents with "benefits of convenience and cost savings" (Wong et al,
2009). For the customers, the benefits range from ease of accessibility, reduced wait in-lines,
24/7 access to account, to ease and speed of fund transfer across and within banks. In addition,
it also allows for "enhanced control", "ease of usability" and "reduced transaction charges"
(Unsal and Movassaghi, 2001). The main attraction for customers is the flexibility of
conducting high speed banking transactions without geographical barriers or time constraints,
and a very low cost (Sayar and Wolfe, 2007; Singhal and Padhmanabhan, 2008; Manzano et
al, 2008). Lastly, with online banking, customers could easily access personalized
information content and choose from a range of services available for investment and
financial decision making purposes (Manzano et al, 2008).
Most advanced banks have adopted technology even before the emergence of the internet in
order to automate their business operations (Sayar and Wolfe, 2007). However, achieving
competitive advantage and maintaining close relationship with customers are among the
many benefits for banks while providing internet banking services (Mols, 2000; Moutinho
and Philips, 2002; Aladwani, 2001). Banks have come to realize that it is cheaper to deliver
services over the internet than by using the traditional ways (Gerrard et al, 2006).
Furthermore, Sayar and Wolfe (2007) and Moutinho and Philips, (2002) in their studies
mentioned that efficiency and improved service quality are also part of the reasons why banks
provide internet banking services. Internet banking also present banks with the opportunity to
amplify their geographic range (Perumal and Shanmugam, 2004). However, Thornton and
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White (2001) argued that attracting new customers and retaining current ones is as important
as cost cutting and achieving competitiveness for banks offering internet banking services.
Despite the many advantages of internet banking, there are, yet some drawbacks that exist
within this field. As White and Nteli, (2004) stated; the adoption of internet banking has not
kept pace with the actual usage of the internet. That is, not as many customers use internet
banking services (Sayar and Wolfe, 2007) as they do the internet. The reason is that bank
customers, especially older people often lack trust in the websites that offer internet banking
services (Perumal and Shanmugam, 2004). And since internet banking has been proven to be
"one of the most sensitive tasks performed" by customers; and its increased growth and
popularity has brought about several incidences of attacks from 'cyber' criminals (Mannan,
2008), thus, this is a major drawback for customers considering the adoption of internet
banking. Moreover, Wong et al, (2009) added that customers still preferred the old fashioned
face-to-face interaction because they feel insecure in the online environment.
Subsequently, for banks, internet banking comes with a lot of risks. According to Perumal
and Shanmugam, (2004), these risks include credit risks, interest rate risk, liquidity risk,
transaction risk and total reliability risk. Because online banking customers are not physically
present, it is challenging for banks to verify their customer details and make sound decisions
about credit checks (Perumal and Shanmugam, 2004). Also, banks are very concerned about
security intrusions and attacks to their computers and networks as several surveys have
confirmed that banks are likely to be attacked internally than externally because internal users
have great level of awareness of the systems in place (Perumal and Shanmugam, 2004).
PART TWO: INTERNET SECURITY
2.8 Internet 'Online' Security Defined
The term internet security or online security have been given several other names, for
instance, some researchers refer to it as "Cyber Crime" or "Cyber Security" (Reich, 2008).
Others may call it computer crime, computer intrusion or even network intrusion. That is to
say that, there is no standard definition or term for internet security, and that it varies from
nation to nation (Reich, 2008). However, in the context of online banking, internet security
may refer to as the perceptions of customers on security in terms of transacting online,
making payments, and transmitting information (Casaló et al, 2007). The term 'internet
security' also means the protection of sensitive data from online security breaches. Wall
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(2005) added that the term "Cyber Crime" has come to mean insecurity in the cyber space
over the years and does not limit to crimes that relate to computers only.
2.9 Overview of Internet Banking Security
The increased growth and popularity of internet banking has brought about several incidences
of attacks from 'cyber' criminals (Mannan, 2008). As a result, customers (especially older
people) have become hesitant in adapting internet banking. These attacks are usually in form
of phishing scams where customers receive misleading email messages asking them to input
their account information in to a website that may look exactly like their banks' website
(Egwali, 2008). However, when it comes to security, the customer is as responsible as the
banks themselves because not many customers read and follow the security terms of their
banks (Mannan, 2008). Sasse and Adams, (1999) argued that; this is not particularly true as
users (customers) are usually not aware of the security implications that exist on the internet.
Therefore, it is the banks' responsibility to create awareness for its customers in terms of
security.
According to Adams and Sasse, (1999) 'confidentiality' is an important part of internet
security. This greatly depends on user authentication and verification mechanisms; User ID
and Passwords (Adams and Sasse, 1999). It is these two mechanisms that attract the
attentions of hackers in the cyber 'space'. They (hackers) tend to pay more attention to human
links of security than even the security companies themselves (Adams and Sasse, 1999).
Mannan (2008) believes that some security requirements are often too complex for users and
customers to follow. Despite banks offering 100 percent online security guarantee, it is
usually conditional on the customers' ability to fulfil particular requirements (Mannan, 2008).
If a customers' password or pin is easily guessed, they could be held responsible and liable
for their own carelessness (Mannan, 2008).
2.10 Types of Security Breaches
With the increasing threats to the internet, trust in internet banking has become a major
concern over the years (Nilson et al, 2005). Some of these threats may include; phishing,
identity theft and fraud (Nilson et al, 2005). Phishing or phishing scam is usually done using
a phony website to trick victims (customers) into inputting sensitive data such as password,
credit card details and other bank details in an attempt to defraud them (Reich, 2008). The
perpetrator usually performs this scheme by simply sending an email that contains the link to
that 'fake' website (Reich, 2008). Subsequently, Identity theft is another form of internet
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breach, where a person's identity or personal information is stolen in order to commit theft or
fraud (Reich, 2008). In addition, Spoofing is also a form of security breach by which cyber
criminals pretend to be someone's email or website in order to access personal information.
However, internet security breaches or "cyber crimes" come in several other forms.
According to Burden et al, (2003) some of the security breaches that relate to internet
banking include the following:
Hacking: This type of cyber crime is performed by hackers, who by using technology
gain unauthorized access to private computers to obtain confidential information
(such as bank details) or committing some other kinds of fraud.
Cyber vandalism: This type of crime is often aimed at websites that have already
been hacked into. The perpetrator then makes changes to these websites (sometimes
bank websites) with the intent to destroy it.
Denial of service (DoS) attack: this type of attack is made in attempt to prevent
"legitimate" users from gaining access to their own internet service or a specific
internet service. The perpetrator often uses a host or a "zombie" computer for the
purpose of the attack.
Viruses: viruses are codes usually sent via email in order to disrupt or cause a
computer to perform unusual activities that may harm the system. Usually, those who
send viruses may not be aware that their system has been infected. However, the virus
does not just create itself; there is always someone who started it.
Domain Name Hijacking: this started in the April of 2000 when hackers hijacked
about 50 companies' "domain names" (internet or website address). Hackers usually
perform this task by transferring domain name to some other postal address where
they can easily tap into private information.
Credit card misuse: As a result of new technologies such as websniffer technology
which is used to monitor internet bandwidths, fraudsters can now easily get hold of
credit card details or even buy them online
2.11 Types of Security Measures
According to Hutchinson and Warren, (2003), any internet banking system must satisfy the
following security requirements:
Identification and Authentication: Is the ability to uniquely identify a person.
Authorization: Means the ability to control the action of a person.
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Confidentiality: Is the ability to protect the privacy of a person.
Integrity: Is the ability to assure that data have not been modified accidentally or by
any other means.
Non-repudiation: Is the ability to prevent denial of actions by a person.
Availability: Is the ability to provide services to a person uninterruptedly.
Privacy: Is the ability to prevent unlawful or unethical use of information.
Auditability: Is the ability to keep an accurate record of all transactions for the
purpose of reconciliation.
Also, on the customer's part, trust in internet banking can be gained through the provision of
the following by banks (Hutchinson and Warren, 2003):
Protection: This is a process that ensures the customer that his or her personal data is
adequately maintained and preserved by the bank collecting the information.
Verification: This is a process by which some kind of proof is provided to the
customer that their bank's websites is accurate and that they are actually transacting
with the real internet bank.
Authentication: This is a process that guarantees that the website the customer is
dealing with, is indeed authentic and real.
Non-repudiation: This ensures that the customer can be certain they are
communicating with the bank or vice versa, such that neither of the communicating
parties can later falsely deny that the transaction actually took place.
2.12 Internet Security in UK and Nigeria
Whether it is in a developing or a developed world, internet banking comes with a lot of
security issues. In 2006, bank card related fraud in the UK dropped enormously, however
internet banking fraud increased by 55 percent during this period (Mannan, 2008). A survey
about security found that 40 percent of 23,000 internet users all over Europe worry about
security (Mannan, 2008). On the other hand, the popularity of internet banking in Nigeria has
brought about legitimate and illegitimate online practices (Egwali, 2008). Ezeoha (2005)
revealed that customers in Nigeria are quite hesitant in adapting internet banking because of
the fear of being exploited by cyber criminals who use deceptive looking but real websites to
phish users' sensitive data. Chiemeke et al (2006) also confirmed that Nigerian banks' major
challenges are fraud and corruption. This is particularly true because of the reputation that
Nigeria has for Internet fraud in the world (Chiemeke et al, 2006).
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Nigeria is popularly "regarded as the headquarters of Advance fee fraud or 419" (Ezeoha,
2005). The Advanced Fee Fraud Scheme or 419 is one of the most popular internet frauds in
Nigeria (Ezeoha, 2005). "The code 419 is named after section '419' of the Nigerian criminal
code that deals with obtaining property by false pretence and cheating" (Ezeoha, 2005). It
consists of anything from bank frauds such as scams, money laundry, to forgeries (Ezeoha,
2005). These issues have become the main reason why internet banking adoptions is still
growing at a very slow pace.
The rapid growth of technology and security measures has left banks more confident about
their security system. In the more developed world, banks are becoming more reluctant in
refunding customers who are victims of cyber attacks such as phishing (Mannan, 2008).
Mannan (2008) also reported that; in US, there were more victims of phishing in 2006 than in
2005, while 80 percent of the victims of 2006 got their money back only 54 percent of 2005
victims were reimbursed. Therefore, by adopting the ways and security tools used in the more
advanced global banks, developing banks could also cut their losses to a minimum level. One
way is to implement security indicators (SI) on the banks' website to alert customer (Egwali,
2008). Another way is by encouraging them to implement the 128 bit Secure Sockets Layer
(SSL) encryption security measures (Chiemeke et al 2006). In addition, Chiemeke et al
(2006) suggested that; banks should constantly update their websites and maintain their
security features, level of confidentiality, integrity, availability and effective communication.
Increasing customer awareness in the subject of security is also very important stated (Adams
and Sasse, 1999). This includes warning them against writing their password or PIN down or
choosing easily guessed PIN (Adams and Sasse, 1999). Since the "ability to crack a password
is greater than usually believed" (Davis and Ganesan, 1999).
2.13 Customer's Perceived Risk and Trust
Customer's security and particularly trust in the online banking environment is a vital issue
(Nilson et al, 2005), mostly because developments in new technologies have made privacy a
growing concern (Casaló et al, 2007). However, customers attracted to online banking tend to
be unconcerned about the threats that exist (such as identity theft and phishing scams) (Hole
et al, 2006) because they lack awareness and knowledge of such issue. Therefore, Wong et al,
(2009) stressed the importance of trust especially in areas where "risk", "uncertainty" and
"interdependence" exist (i.e. the online environment). In general, "perceived risk" means
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"customers perceptions of the uncertainty and possible undesirable consequences of
transacting online" (Wong et al, 2009). A research found that, perceived risk is directly
related to an individual's willingness to engage in online banking (Gerrard et al, 2006) and
this is often affected by fear of theft or fraud (Gerrard et al, 2006).
Perceived risk and trust are somehow interdependent. According to Wong et al, (2009) lack
of trust is one of the key reasons why consumers are hesitant in carrying out financial
transactions over the internet. Another reason for the increased need in trust is the consumers'
growing fear of safety due to perpetrators such as hackers and other cyber crimes (Wong et al,
2009). However, it has been identified that the effect of trust in online banking could be
reduced or managed through perceived risk (Wong et al, 2009). Therefore, increased trust
may yield to satisfied and committed customers (Wong et al, 2009).
2.14 Summary
In summary, the internet has greatly affected the way banks conduct their business and the
way individuals conduct financial transactions. Banks have come to realise that only by
adopting internet banking will they reach global standards and achieve competitive advantage.
In Nigeria, internet banking is still at a cradle stage. In order words, Nigeria's banking
systems still operates at a basic level of interactivity. Whilst, UK's internet banking system is
much more sophisticated and advanced as it has been in existence for over 13 years now.
There are three main types of internet banking service; information, communication and
transactions and within each of these services, are a varied range of products. Furthermore, it
has been identified that the main factors that influence internet banking adoption for
customers include; accessibility, convenience, reliability, flexibility, security, speed of
transaction on the internet etc. while factors such as cost saving, increased customer base,
marketing and communication, innovation are among the many reasons why banks
implement internet banking systems.
The primary benefit for customers while conducting internet banking is the ability to access
one's account from anywhere, at any time and place. While for the banks, the main benefit is
the ability to attract new customers and retain existing ones. On the other hand, the major
drawback for the customers has been identified to be the exposure to cyber crimes and the
risk of transacting online. While for the banks, the major drawback is the fact that customers
are hesitant in adopting internet banking services due to security issues.
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The rapid growth of the internet, and subsequently, the increased adoption of internet banking
have brought about several incidences of crimes over the internet (also known as cyber
crimes). Most popular cyber crime well-known to online banking customers is the phishing
scam. Others include hacking, cyber vandalism, credit card misuse, viruses etc. These crimes
could be prevented if appropriate security measures are implemented. The types of security
measures available to banks and their customers include; username and password
identification and authentication; verification; authorization and many others.
Finally, several findings show that Nigerians are more concerned about security than British.
This is because the case of internet fraud is more prominent in Nigeria as compared to the
UK. And most banks in Nigeria lack appropriate security technologies and also, the country
is well-known for corruption and illegitimate affairs (more popularly known as '419').
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CHAPTER 3
3. METHODOLOGY
3.1 Introduction
This chapter presents the methodology for the study, which is an inductive approach
following a mixed method of qualitative and quantitative research strategy. It specifically
covers the methods and sampling techniques, data collection and the framework for data
analysis. The chapter also gives a clear justification for using the particular chosen
methodology.
3.2 The Research Approach
The research approach for this study is inductive in nature. This approach was chosen over a
deductive approach and it implies the gathering of data in order to establish a theoretical
understanding of the topic (Bryman, 2008). As opposed to inductive, deductive approach
implies the use of already established theory to arrive at an outcome (Bryman, 2008).
Inductive approach proved to be more appropriate in this case because there is no theory that
is already in place. According to Bryman (2008), "a 'theory' maybe little more than the
literature on a certain topic in the form of accumulated knowledge gleaned from books and
articles". The key advantage for the inductive approach is that; it allows the researcher to
propose a question or a problem situation and then draw a conclusion based on the data
collected (Silverman, 2000). Therefore, an inductive approach, following a mixed method
best suites this study.
3.3 Research Method
Preceding an inductive approach, a combination of qualitative and quantitative research
strategies is used. Biggam (2008) pointed out that most student or researchers usually think
that their research strategy determines whether their research is going to use a qualitative or a
quantitative approach. However, that is not the case as the research objectives coupled with
the techniques used in collecting the data decides which approach to be used (Biggam, 2008).
After careful review of the research objectives, it was concluded that a combination of
secondary and primary data should be obtained. A secondary data is basically a literature
based study which allows the collection of data from some or all of the following sources;
books; journal articles; databases; government reports; internet sources etc. (Biggam, 2008).
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On the other hand, a primary data in this case, follows a quantitative study which attempts to
answer the question 'how' a particular question needs to be answered (Biggam, 2008).
A mixed method is employed using 'completeness' method. As Bryman (2008) asserted;
completeness is used when the researcher requires a more complete answer to a research
question(s) and its objectives. A completeness method is achieved by including both
quantitative and qualitative methods. It means that the gap left in one method can be fulfilled
using the other. In this case, a qualitative method is established in the literature review in
anticipation of fulfilling some of the objectives while, a quantitative method is in a form of
survey questionnaires established to obtain primary data.
Qualitative research is a research strategy that usually stresses the use of words rather than
numbers in the collection and analysis of data (Bryman, 2000). One of its advantages is that;
it allows researchers to view things "through the eyes of the people being studied" (Bryman,
2000). Secondly, it enables the researcher to be descriptive and thorough when drawing
results and arriving at conclusions. On the other hand, a quantitative study entails "the
collection of numerical data" (Bryman, 2000). "It refers to a research that is concerned with
quantities and measurement" (Biggam, 2008). While qualitative research answers the why
question, quantitative, answers the how question (Biggam, 2008).
The research aims to find out customers' perceptions on security with regards to internet
banking. Additionally, it attempts to reveal the similarities and differences in customer
perceptions on the banking systems of the two distinct countries. As a result of this, a
quantitative approach was chosen to best suite this research primarily because it enables the
measurement of data and reports the results in a clear and concise manner. Furthermore, a
qualitative approach was also chosen, mostly because it involves studying "things in their
natural settings, attempting to make sense of, or interpret, phenomena in terms of the
meaning people bring to them" (Denzin and Lincoln 1994:2). Also, a qualitative approach is
inductive in nature; has high 'internal validity' and leads the researcher to observe human
behaviour as a way of how they interpret their world (Bogdan and Taylor, 1975; Bryman,
2008).
However, this does not mean that qualitative research is completely without its disadvantages.
Its main criticism as discussed in Bryman (2008) is that; it is often too subjective. That is to
say that; a qualitative study is strictly based on the researcher's point of view. Also, a
qualitative study is not easily replicated and the findings from such research are mostly
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restricted. Whilst, for quantitative study the drawbacks include overreliance on instruments
and procedures; and it often loses sight of other people's views. This concludes that there is
no perfect research strategy therefore, for the purpose of this study; the combination of both
qualitative and quantitative research strategies is more likely to yield better results.
3.4 Data Collection
3.4.1 Questionnaires
The research uses a set of questionnaires as the chosen qualitative method for collecting data.
"A questionnaire may be used in different ways" (Oppenheim, 1998). However, in this case,
the term 'questionnaire comprises of postal questionnaires, group questionnaires, self-
administered questionnaires and structured interviews (Oppenheim, 1998). In the context of
this research, a self-administered questionnaire would be more practical. Self-administered
questionnaires are usually handed out to the respondent by the interviewers themselves and
this method is appropriate because, as stated by (Oppenheim, 1998), it provides greater
response rate, "accurate sampling and a minimum of interviewer bias" while allowing the
interviewer to explain and provide certain degree of personal contacts. However, Oppenheim
(1998) warned that the interviewer should be careful while briefing the respondent so as not
to introduce serious biases.
The questionnaires were designed to accommodate approximately 41 questions categorized
into 5 sections namely A, B, C, D and E. Section A consisted of general questions (such as
age, gender etc.); B consisted of questions about internet banking in general; C comprised of
questions about online security; D was basically questions about internet banking in the UK
and Nigeria; and lastly E presented a set of statements in which the participant would indicate
whether they agree or disagree with the statements. The questions asked were mostly closed
questions with very few open ended ones. This method was considered appropriate because
closed questions are less time consuming and do not requires coding as opposed to open
questions.
A total of 100 questionnaires were administered of which 10 were a pilot study. The 10
questionnaires were given out to Nigerian students at the university campus. The main reason
was to conduct a test about the structure of the questions, the sensitivity and adequacy of the
questions and the language being used. And also to address any potential misunderstanding or
confusion that may arise. At this stage, it was possible to identify the questions that
participants skip and why they skip it. The feedback from the pilot study was positive and
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quite helpful. However, participants observed that, some of the questions lack clarity and
others a little confusing. As a result, some questions were then modified but none of the
questions were considered too sensitive. Following the suggestions of the participants,
additional questions were introduced to eliminate the confusions. The most useful suggestion
given was to clarify whether the kinds of services offered by banks in the UK and Nigeria as
stated in a particular question referred to online-based or the normal "off-the-counter' services.
Out of the 100 questionnaires administered, a total of 83 responses were obtained which is a
response rate of about 80 percent. Thus, this was considered a huge success. A copy of the
questionnaire could be found in (Appendix 2).
3.4.2 Sampling
To make the research well-structured, highly organized and detailed as Gill and Johnson
(1997) recommended; it is essential to verify the sampling technique that would be used for
distributing the questionnaires. In this case, a combination of two sampling techniques was
used; convenience sampling and random sampling. A convenience sampling as defined by
Biggam (2008) is a "non-probability approach to sampling" where the researcher chooses a
group of people that are most convenient for him/her (maybe in terms of location, age etc.). A
random sampling, also, explained by Biggam (2008) is a sampling technique where a random
population is selected. The two approach coupled together would yield better results as the
research is solely dependent on questionnaires.
Nigerian students studying at the University of Sheffield were the main target for this
research. This is primarily because living in the UK has led them to experience both banking
systems. They could easily relate to the problem situation and easily make comparisons. In
addition, the number of Nigerians in the university has been found to be quite higher than
expected and postgraduate students alone came to a total of 99. Consequently, the study
focused mostly on the postgraduate student, as they are more matured and have a lot of
experience. Therefore, by limiting the sample size to Nigerian students, a more accurate
result would be obtained.
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3.4.3 Literature Review
Apart from the questionnaires, a literature review was conducted with the intention to fulfil
some of the objective and to provide a more clear view of the research topic and its
background knowledge as a whole. Following the review, a number of both printed and
electronic documents were examined, most particularly; journal articles and books were
reviewed. Moreover, the literature review helped in determining the level of internet banking
adoption in the two countries being investigated and their positions towards customer
perceptions and trust in conducting internet banking. Some of the sources used in reviewing
the literature include:
Online databases (such as Emerald Insight, journal of internet banking and commerce
(JIBC) and Google Scholar)
Bank websites (UK and Nigeria's banking websites)
Previous Dissertations
Book's from the university's library (mainly books on research)
3.5 Data Analysis
In analyzing the data, a quantitative method was chosen because the research uses survey
data. Computer software called Statistical Package for Social Sciences (SPSS) was used to
analyse data obtained from the questionnaires. These data were first coded then entered into
the system and results obtained from it were presented in form of pie charts, bar charts,
histograms and frequency tables. For the final section in the survey, a likert scale (of scale 1-
5) is used to measure the intensity of individual attitudes (refer to chapter four for further
details regarding this section).
3.6 Ethical Issues
The research proposes the use of human participants. Questionnaires will simply be delivered,
targeting the general public (please refer to the section on sampling for more information). It
would be explained to them, the nature of the questions and seek their approval before
handing out the questionnaires. An information sheet is attached to the questionnaires stating
that participation is voluntary and if doubts or complaints arise they can easily contact the
university's registrar or supervisor in charge. However, the research raises a very low risk of
ethical concerns because the questionnaires will not contain any sensitive or personal
questions and all responses obtained will remain anonymous. In addition, the respondent
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could at anytime choose not to respond to any of the questions if he/she is not comfortable.
Also, the research is carried out in accordance with the University of Sheffield's Ethics
Committee. A copy of the information sheet could be found in (Appendix 1).
3.7 Summary
In summary, the research methodology used in carrying out this research is an inductive
approach preceding a mixed method of qualitative and quantitative research strategies. It is
qualitative in the sense that literatures pertaining security and internet banking in the UK and
Nigeria is reviewed, and quantitative in the parts where data is collected and analysed in
order to arrive at the conclusions. Subsequently, data were collected in a form of
questionnaires targeting the Nigerian students studying at the university as they have
experienced the banking systems of both UK and Nigeria. As a result, a total of 100
questionnaires have been administered to enable a more accurate and unbiased findings to the
research. However to arrive at the results, a quantitative data analysis technique has been
proposed, which uses SPSS in analyzing the data obtained through the questionnaires.
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CHAPTER 4
4. ANALYSIS OF RESULTS
4.1 Introduction
This chapter presents the results of the data collected from the research. The data is reviewed
using a quantitative data analysis and generated through several data analysis techniques. The
results acquired were illustrated in form of tables and figures, for better and easier
understanding of the information obtained.
4.2 Questionnaires
A self-administered questionnaire was chosen as the preferred method of data collection. It
was developed and administered in Sheffield to a sample size of 99 postgraduate students at
the university. The process began on June 25th
and ended August 15th
. A total result of 83
questionnaires were obtained, which is a response rate of (82%) percent. This was considered
to be a huge success. The questionnaires were designed to accommodate 41 questions
categorised into 5 sections and it entails both closed-ended and open ended questions, (for a
copy of the questionnaire, see appendix 2). Also, a brief introduction to each of the sections
in the questionnaire was discussed in chapter 3.
4.3 Method of Analysis
As discussed in the previous chapter, a quantitative data analysis was used. Different
techniques for analysing quantitative data were examined and implemented using computer
software called SPSS for windows. SPSS is short for Statistical Package for Social Sciences
and has been used for quantitative data analysis since the 1960s (Bryman, 2008). The
software requires already processed and coded questionnaire. A ranking scale of one to five
(1-5) was used to code closed-ended questions while open-ended questions were coded
through a coding frame which enables the researcher to read and reread the different
responses in order to categorise them under different codes (or numbers). Subsequently, the
software allows the researcher to generate results using different methods of analysis such as
frequency tables, pie charts, bar charts, histograms, contingency tables etc. In the last section
of the questionnaire, a Likert Scale was used to code the data because the section deals with
investigating individual's attitudes and feelings. The main purpose of Likert Scale is to
measure the intensity of feelings about the specific questions being asked (Bryman, 2008). A
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5-point scale was used, with 5 measuring the highest score of intensity for positive feelings to
1 measuring the score of intensity for negative feelings.
4.4 Survey Results
In the first part of the questionnaire, questions regarding gender, age and length of stay were
asked. It was obtained from the results that, 44 respondents (53 percent) were male and 39
(47 percent) were female. Also, the results revealed that; majority of the respondents were of
age between 21 and 30 which amount to 73.2 percent. 16 respondents (19.5 percent) were
between the age 31 and 40; three (3.7 percent) were above the age 40 and two (2.4 percent)
were between the age 16 and 20. The highest percentage of participant being 21-30 was not
very surprising as the target sample was mainly postgraduate students. For the question
regarding the length of stay, the research found that almost all of the respondents have been
living in Sheffield for about 10 to12 months with the exceptions of, one respondent who has
been living in Sheffield for seven years and another, five years. However, few stated that
they've been living in Sheffield for nine months. Table 4.1 displays the results obtained for
the gender and table 4.2 displays the results obtained for age in the form of frequency tables,
with the middle column representing frequency and third column representing the percentage.
Frequency Percent
Valid Male 44 53.0
Female 39 47.0
Total 83 100.0
Table 4.1: Respondents' Gender
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Table 4.2: Age of Respondents
4.5 Internet 'Online' Banking
In section B of the questionnaire, questions about internet banking were asked. The first
question in this section attempts to answer how frequently respondents engage in internet
banking and secondly, their reasons for choosing to bank online.
Figure 4.1 illustrates the frequency at which respondent conduct internet banking. A bar chart
represents the percentage and number of respondents and how frequently they conduct
internet banking. A very high percentage, precisely, 37.04 percent indicated that respondent
conduct internet banking 'a lot' and 34.57 percent said they conduct internet banking 'quite a
lot'. Therefore, this figure concludes that; the majority of the respondents were internet
banking customers and tend to use this medium as their preferred method of conducting
financial transactions. However, 14 respondents (17.28 percent) reported that they did not
conduct internet banking as much while 5 respondents (6.17 percent) reported that; they
never engaged in such activity. Lastly, the figure showed that only 4 of the respondents were
'not sure' of how often they engaged in online banking.
Frequency Percent
Valid 16-20 2 2.4
21-30 60 73.2
31-40 16 19.5
41 or above 3 3.7
I prefer not to say 1 1.2
Total 82 100.0
Missing .00 1
Total 83
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Figure 4.1: Frequency at which customers use internet banking
Figure 4.2 exhibits results for reasons why respondents choose to bank online in form of a pie
chart. Out of the 83 respondents, 50 reported that they conducted internet banking for
convenience purposes. This displays a large portion of the chart with a percentage of 61.73
percent; 22.22 percent chose accessibility as their main reason while 12.35 percent chose
speed; only 1.23 percent think ease of use is a reason for conducting internet banking.
However, some of the options specified; such as better rate, lower service charge, cost and
security were not considered at all. That is to say that; most internet banking customers are
attracted by the convenience, accessibility and speed of banking online. This is not quite
surprising because several finding have come up with the same results as the primary reasons
for internet banking customers choosing to conduct their financial transactions over the
internet.
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Figure 4.2: Reasons for banking online
The evolution of internet banking and technology has presented with several benefits for
customers. One of the primary benefits and reasons for online banking as derived from the
results above is convenience. Convenience of accessing one's account from anywhere, and at
anytime; and the ability to conduct most financial transaction through the internet has
reduced the number of visits to traditional bank branches by individual customers.
Consequently, the survey results presented the frequency at which respondents (customers)
visit their bank's branch per month and their reasons for visiting.
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Table 4.3 displays results of the frequency at which respondents (customers) visited their
bank's branch per month. The result indicated that; 55.5 percent of respondents visit their
bank between 1 and 3 time(s); 26.5 percent reported that they visited less than 1 time; 15.7
percent reported that they visited 4 to 8 times while only 2.4 percent visited their bank more
than 12 times.
Frequency Percent
Valid Less than 1 22 26.5
1 to 3 times 46 55.4
4 to 8 times 13 15.7
Over 12 times 2 2.4
Total 83 100.0
Table 4.3: Frequency at which customer's visit their bank branch
Mostly, those who visited their bank went to make deposit. This result was obtained from
figure 4.3 below. The figure displays results on the reasons for visiting bank branch in form
of a pie chart. The majority of the respondents reported that the primary reason for visiting
their bank's branch is to make deposit. This percentage came to a total of 71.08 percent.
Subsequently, the second largest percentage (15.66 percent) went to make complaints and
very few went to withdraw cash or cash cheques. The percentages were 6.02 percent and 2.41
percent respectively.
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Figure 4.3: Reasons for banking online
Other questions regarding internet banking were also enquired in this section, particularly,
questions relating to telephone banking and automated teller machines (ATM) were asked.
Participants were asked questions on how frequently they used telephone banking and how
frequently they used the ATM machines per month. Surprisingly, the result derived,
concluded that; not many internet banking customers used telephone banking as much as they
use the internet itself. Precisely, 71.6 percent of the participant reported that they used
telephone banking zero or one time per month. 17.3 percent indicated that they used it about
one to three (1-3) times while 8.6 percent said they used it 4 to 8 times, only 2.5 percent used
telephone banking over 12 times in a month.
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The results were quite fascinating and revealed a huge gap between the frequencies obtained
for telephone banking and ATM usage. In fact, the results obtained for ATM usage were
almost opposite to that of the telephone banking. Thus, 33 participants (39.8 percent)
revealed that they used the ATMs more than 12 times per month; 28.9 percent used it 4 to 8;
21.7 percent used it 9 to 12 times; while 6.0 percent used it 1 to 3 times, only 3.6 percent used
the ATM between zero and 3 times. Therefore, it can be derived from these results that;
internet banking customers or individuals in general tend to use the ATMs more than they use
telephone banking.
4.6 Security and Internet banking
The third section of the questionnaire addresses the issue of security in internet banking.
There were 11 questions within this section and the main purpose was to find out participants'
perceptions on security. The section also aims to acquire respondents' levels of concern about
security while banking online and their attitudes towards internet fraud and related crimes.
Additionally, participants were asked to report their bank's reactions to fraud and how the
banks attempt to resolve such issue.
Figure 4.4 provides a clear illustration of the various participants' level of concerns in
conducting internet banking. The results were displayed in form of bar chart. Of the 83
respondents, 38 (i.e. 45.78 percent) reported that their level of concerns on security is
'extremely high' and precisely 18 (21.69 percent) of the respondents have 'high' concerns.
That is to say; 67 percent of the respondents perceive security to be of top priority while
banking online. At the middle of the chart, the percentage of respondent who have 'medium'
concerns is displayed. The result presents that 17 (20.48 percent) of the respondents have
medium concerns. In other words, their concerns about security are moderate and they do not
perceive security to be of high relevance. On the other hand, the numbers of respondents
having low or no concerns at all were not so many. As can be seen in the figure 4.4 below,
the percentages were 3.61 percent and 8.43 percent respectively, which is not up to 25
percent of the total responses rate.
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Figure 4.4: Level of security concerns as perceived by customers
After discovering the level of security concerns, participants were then asked to reveal what
their concerns were manly about. The results were illustrated in form of pie chart in the
figure 4.5 below. Participants were provided with three options (see figure 4.5 below) to
choose from and the majority chose; "afraid someone might get access to account". This is
presented as 80.49 percent in the chart. The reason behind this response could be as a result
of the existence of cyber criminals like hackers (as discussed in chapter 2) who can easily
hack into a person's computer and access sensitive information such as account username and
password. However, very few (8 respondents) relate their concerns to the security of the
bank's website itself. The percentage came to a total of 9.76 percent. This means online
banking customers often trust their bank's website but are more concerned with the risk of
transacting on the internet as a whole. Subsequently, the remaining 9.76 percent of the
respondents chose the option "Other" as they may have other reasons beside the ones
provided in the survey.
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Figure 4.5: Reasons for Security Concerns as Perceived by Participants
Despite the high level of concerns about security and fear of transacting online, it was quite
surprising that not many participants reported that they have actually experienced fraudulent
attacks. Only 31.3 percent of the participants responded positively when asked if they have
been affected by internet fraud. The remaining 68.7 percent of participant's responses were
negative. This result can be seen in the table 4.4 below which displays the frequency in one
column and the percentage in the other.
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Frequency Percent
Valid Yes 26 31.3
No 57 68.7
Total 83 100.0
Table 4.4: Number of Respondents Affected by Internet Fraud
Nonetheless, those who responded positively to having been affected by internet fraud were
also required to state the number of times they have experienced such issue. Thus the entire
respondents reported that it occurred one or two time(s). In other words, the 26 (i.e. 31
percent) participants that admitted to being affected by internet fraud indicated that the
number of occurrence were once or twice. However, when asked if that has stopped them
from further engaging in internet banking? Surprisingly, 21 (25.3 percent) of the respondent
said "No" and only four (4.8 percent) answered "Yes" to the question. The table below shows
the results in terms of frequencies and percentages with the frequency column showing the
number of respondents and the percent column displaying the percentage.
Frequency Percent
Valid Yes 4 4.8
No 21 25.3
Total 25 30.1
Missing .00 58 69.9
Total 83 100.0
Table 4.5: Percentage of Respondents Who Disengaged in Internet Banking
Although, being a victim of internet fraud did not stop the participants from further engaging
in internet banking, their reactions after such incident were quite captivating. When asked of
their reactions, one participant said:
"I was shocked and that is why I do not do online banking"
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This participant was also among the four respondents (mentioned above) who disengaged in
the use of internet banking because they have been affected by internet fraud. Another
participant reported that:
"I was surprised and worried because I couldn't make payments with my card and when I
called the bank, they told me about the issue and rectified it"
A third participants' reaction was simply:
"I was angry and I reported to the bank"
Similarly, a fourth participant said:
"I was angry and I reported to the bank"
Many of these participants were mainly expressing their feelings and not stating how they
approached the situation. Indeed, when faced with such an unfortunate situation most people
do not tackle things rationally. However, some actually gave a brief description on how they
dealt with the situation. One response was:
"Went to the bank, I opened the account to complain verbally, insisting to understand why it
happened and how I can get my money back"
Another interesting one was when the participant said he visited the bank's branch and laid
complaints:
"Mailed the customer complaints unit of my bank. I also paid a visit to a branch of the bank
to lay my complaints"
Likewise a second respondent reported the same:
"Went to my bank branch to complain and told them I would sue them"
Two other respondents said they just reported to their bank:
"Reported to my bank immediately"
And lastly, a participant described her reaction as follows:
"I was very angry. I was broke and my money was missing. The bank made an effort to get
my money back but it wasn't possible"
It can be concluded that respondent affected by internet fraud were left feeling hostile and
vulnerable and therefore consider themselves at high risk. This could lead to lack of trust in
internet banking. Unless banks provide extraordinary security measures or solutions to those
faced with internet fraud, they will lose their customers' trust. Thus respondents who have
been affected by internet fraud were also asked of their banks' approach to resolving issues
regarding fraud and were provided with options to choose from. The figure 4.6 below shows
the results to this question.
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The results were illustrated in form of pie chart and participants were provided with four
options. Of the 26 respondent that were reported victims of internet fraud, 25 responded to
this particular question. 11 of the respondents (i.e. 44 percent) indicated that their banks
provided refunds. Subsequently, 40 percent of the participants said their banks issued a new
credit/debit card but could not reimburse them. Lastly, four of the respondents (i.e. 26 percent)
reported that their banks implemented new security measures in addition to replacing their
credit/ debit cards.
Figure 4.6: Banks approach to resolving internet fraud issues
The participants also stated their level of satisfaction with how their banks dealt with fraud
issues. Figure 4.7 below is a pie chart that represents the level of customer satisfactions.
Furthermore, 11 respondents (40 percent) which is equivalent to the number of respondents
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who received reimbursement said they were "very satisfied". This is not surprising since
these respondents were reimbursed and therefore have certain level of trust in their banks. In
addition seven (28 percent) admitted that they were quite "satisfied" with their bank; while
five respondent (20 percent) were neutral toward the whole situation, only two (8 percent)
reported that their banks approach to resolving the issues was completely unsatisfactory.
Figure 4.7: Level of customer satisfaction
In addition to this, participants also responded to questions like; 1) Does your bank provide
advice on security? 2) Does your bank allow you to create your own user name and password?
And 3) Does your bank provide additional security measures? The results of these questions
are shown in the tables below: Table 4.6 provides answers to question 1, in which 73
respondents (i.e. 88 percent) said 'Yes' to the question; 6 respondents (i.e. 7.2 percent)
responded negatively and 4 (4.8 percent) reported that they are not aware of such services
being offered by their banks.
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Table 4.7 displays results obtained for question 2 above, in which 61 (73.5 percent)
participants admitted to banks allowing them to create their username and password; 18 (21.7
percent) responded 'No' while the remaining 4 (4.8 percent) answered 'Don't know' .
Lastly, table 4.8 displays results obtained for question 3 above, in which 40 (48.2 percent)
participants said 'Yes' to the question; 31 (37.3 percent) answered 'No' and the remaining 12
(14.5 percent) reported that they 'Don't know'.
Frequency Percent
Valid Yes 73 88.0
No 6 7.2
Don't know 4 4.8
Total 83 100.0
Table 4.6: Responses on bank security
Table 4.7: Responses on user name and password
Table 4.8: Responses on security measures
The main purpose for these questions was to find out what banks do to ensure security and
assure their customers of safety while banking online. In conclusion, the results show that
Frequency Percent
Valid Yes 61 73.5
No 18 21.7
Don't know 4 4.8
Total 83 100.0
Frequency Percent
Valid Yes 40 48.2
No 31 37.3
Don't know 12 14.5
Total 83 100.0
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most of the participants are concerned with security but not of the bank's website itself, but of
general fear of transacting on the internet as a whole.
4.7 Internet Banking in Nigeria and UK
The fourth section of the questionnaire that is, Section D compares the internet banking
services offered in UK and Nigeria. Specifically, participants were asked how the British
banking system differs from that of Nigeria. Also, they were given options to choose from, a
list of services that they are aware of, that are offered in the UK and Nigeria. The list of
services included both advanced and basic level of bank websites' interactivity.
The figure 4.8 below shows the difference in internet banking system of Nigeria and UK as
perceived by participants. As can be seen in the bar chart below, 39 (48.75 percent) of the
respondents believe the two banking systems differ 'Greatly'; 12 (15 percent) reported that
the difference is 'Only a little' and 25 (31.25 percent) admitted that they 'Don't know' while
only 2 (2.50 percent) reported that there is 'No difference' at all; the remaining 2 (2.50 percent)
chose the option 'Other'. The high percentage of response being 'greatly' was as a result of
the level of bank website interactivity. Participants indicated that British bank websites
provide advanced level of interactivity in addition to the basic services offered. Whilst, banks
in Nigeria do not offer all of the basic services offered in British banks.
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Figure 4.8: Difference in Internet Banking System of Nigeria and UK as perceived by
customers
For the basic level of interactivity, the following options were provided: Check account
balance, Check account transaction, Account details, Check historical records, Bill payments,
Transfer funds, Standing order/direct debit, View credit card balance, Credit card bill
payment, Order cheque book, Order/print statement, Send messages, View credit balance.
For the advance level of interactivity, the following options were provide: Open current
account, Apply for loan, Apply for mortgage, Apply for savings account, Apply for insurance.
All of the above listed basic services are offered in British banks' websites but only account
details, check account balance, check account transactions, print statements and order/print
statements are offered in Nigerian banks. While for the advanced services, British banks offer
services such as; open current account, apply for loan, apply for mortgage and apply for
insurance for their online banking customers, while none of the advanced services mentioned
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above are offered online in Nigerian banks. The figure 4.9 below shows the level of Nigerian
and British banks' website interactivity.
A bar chart illustrates the level of bank website interactivity of UK and Nigerian banks. It
specifically displays the advanced and the basic level of interactivity. The blue colour
represents Nigeria and the red represents UK. From the chart, it can be seen that Nigeria is far
behind both in delivering the basic services and the advanced services as well. For the basic
level of interactivity, 56 participants reported that British banks provide all the basic services
online as listed above while only 27 participants indicated that only some of the basic
services are offered in Nigerian banks. However, 72 participants reported that British banks
offer almost all of the advanced services but only 11 stated that Nigerian banking websites
offer some of the advanced services online.
This concludes that; British banks are more innovative and developed than Nigerian banks. In
addition, British banks have the advantage of better information technology and
telecommunication infrastructure and an enhanced level of internet penetration.
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Figure 4.9: Level of website interactivity (UK & Nigeria)
In the second part of this section, participants were asked if they have noticed any similarities
between the banking systems of UK and Nigeria. Table 4.9 is a frequency table showing the
number and percentage of people who responded to that particular question. 41 respondents
which is equivalent to 50 percent reported that; a great similarity exist between the two
banking systems while 28 respondents (i.e. 34.1 percent) said 'No'; the remaining 13
respondents (15.9 percent) admitted that they 'Don't know' or are not aware of any
similarities that exist between the two countries.
Table 4.9: Similarities in internet banking system of Nigeria & UK as perceived by customers
0
10
20
30
40
50
60
70
80
Basic Advanced
Website Interactivity
Frequency Percent
Valid Yes 41 50.0
No 28 34.1
Don't know 13 15.9
Total 82 100.0
Missing .00 1
Total 83
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4.8 Customers Perceptions and Attitudes towards Internet Banking
The final section which is section E consists of a set of statements in which the participant is
required to state whether he/she agrees or disagrees with them. Within this section, 13
questions were asked and the main purpose was to investigate participants' attitudes and
feelings towards internet banking and internet security.
First of all, participants were asked whether they are willing to provide their credit/debit card
details over the internet in the UK and their responses were; 32 (38.55 percent) of the
participants responded 'strongly agree' and 36 respondents (43.37 percent) agreed to that
statement. In other words, online banking customers in the UK are usually unconcerned about
security and are willing to provide sensitive information such as credit/ debit card details over
the internet without hesitations. This could be because of the trust that has already been
established and the advanced security measure that online shopping portals and banking
websites implement. On the other hand, 10 respondents (12.05 percent) reported that their
feelings are neutral while, only 5 respondents (6.02 percent) disagreed to this statement.
Figure 4.10 below illustrated these results in form of a bar chart.
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Figure 4.10: Customers' willingness to provide credit/debit card details over the internet in
the UK
Secondly, participants were then asked if they are willing to provide credit/debit card details
over the internet in Nigeria. Figure 4.11 below displays the result in form of a bar chart.
From the chart below, it can be seen that none of the respondents strongly agrees with this
statement and only seven (8.43 percent) respondents agree while 11 (13. 25 percent) are
neutral. On the other hand, the number of participants who reported that they strongly
disagree is quite fascinating. This was reported to be 60.24 percent of the total responses
while the number of participants who disagreed to this statement came to a total of 18.07
percent. This can be reflected in the literature about Nigeria being a notorious for internet
fraud and corruption (in chapter two).
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Figure 4.11: Customers' willingness to provide credit/debit card details over the internet in
Nigeria
In the next part of this section, participants were asked if they are willing to provide
credit/debit card details over the telephone in the UK and Nigeria. Results obtained show that
69.88 percent of the respondents strongly disagree; 22.89 percent disagreed; and 6. 02 percent
are neutral while only 1.20 percent agreed that they are willing to provide credit/debit card
details over the telephone in Nigeria. However in the UK, participants reported that they are
willing to provide credit/debit card details over the telephone. Results obtained for this
include; 23 respondents (27.71 percent) reporting that they strongly agree and 36 respondents
(43.37 percent) said they simply agree to this statement. Thus, 16 respondents (19.28 percent)
are neutral; 7 respondents (8.43 percent) reported that they disagree; while only one
respondent (1.20) percent strongly disagrees.
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These results reveal that; the same participants who are willing to provide their credit/ debit
card details over the telephone in the UK are not willing to provide the same information in
Nigeria.
Similarly, participants were then asked if they are willing to provide credit/card details via
fax or email in Nigeria and the UK. Results show that, of the 83 responses obtained, 20.48
percent strongly agreed that they would provide such sensitive information via fax or email in
the UK and 42.17 percent simply agreed while 13.25 percent disagreed with this statement,
only 7.23 percent strongly disagreed. The remaining 16.87 percent stated that their feelings
are neutral. On the other hand, results obtained for Nigeria was quite the opposite as 77. 11
percent strongly disagreed, which is equivalent to 64 respondents of the total of 83. 18.07
percent disagreed while the remaining 4.82 percent reported neutral.
The result concludes that participants are more willing to provide their credit/debit card
details via fax or email in UK than in Nigeria. These findings could be related to the literature
in chapter two, in which Nigerians are being exploited by phishing scams usually sent
through email.
Consequently, participants were then asked if they feel more secured banking online in UK as
compared to Nigeria. The results are illustrated in form of bar chart in the figure 4.12 below.
Specifically, the results present whether they agree with the statement or not. Result obtained
show that; 54.22 percent strongly agree with this statement, 27.71 percent agree that this
statement is true, 12.05 percent reported neutral while the remaining 4.82 percent and 1.20
percent disagree and strongly disagree respectively.
However this is not surprising since participants' attitudes to providing credit/debit card
details in Nigeria have been reported to be negative regardless of the method of transaction
used, whether it is by telephone, via email or over the internet.
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Figure 4.12: Customers feel more secure banking in the UK as compared to Nigeria
Furthermore, participants were then asked if they consider themselves to be at risk while
engaging in internet banking in general. A bar chart in figure 4.13 below illustrates the results.
33.73 percent strongly agreed that they consider themselves to be at risk; also, 30.12 percent
reported that they agree that they are at risk while banking online. While, only 3.61 percent
and 7.23 percent strongly disagree and disagreed to this statement, 25.30 percent reported that
their feelings are neutral.
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Figure 4.13: Customers consider themselves to be at risk while banking online
Finally, participants were asked whether security is one of the main issues affecting Nigeria's
internet banking system. The results for this statement is presented in the figure 4.14 below,
in which, results are illustrated in form of bar chart. From the chart, it can be seen that; 53
respondents (63.86 percent) admitted that they strongly agree; 24 respondents (28.92 percent)
reported that they agree with the statement; while three respondents (3.61 percent) are neutral;
only one respondent (1.20 percent) and two respondents (2.41 percent) admitted that they
disagree and strongly disagree respectively.
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Figure 4.14: Security is the main issue affecting Nigeria's internet banking system
4.9 Summary
In summary, findings show that respondent conduct internet banking a lot and the primary
reasons for conducting internet banking has been indicated to be convenience, accessibility
and speed. Consequently, respondents did not visit their bank's branch simply because of the
availability of internet banking service. With the convenience and accessibility of internet
banking, customers (respondents) have reduced their visits to the physical branch however,
those visited, mainly went to make deposits or make complaints.
It has been identified that, most of the customers (respondents) were concerned about security
while banking online. And their main concern was that they are afraid someone might access
their account. Although, a huge percentage shows that customers are highly concerned about
security, not many of them have experienced internet fraud and those who have experienced
such issue did not disengage in banking online.
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Results also reported that, Nigeria's online banking system is still at a basic level of
interactivity, while UK's banking system is much more sophisticated and advanced. Thereby,
reporting a great difference between the two banking systems and thus, very little similarities.
Finally, in measuring the attitudes and perceptions of respondents, results obtained concluded
that; respondents are more willing to provide sensitive information such as credit/ debit card
details online or over the telephone in the UK as opposed to Nigeria. This is because
perceived customer risk is higher in Nigeria than in the UK. Also, a very high percentage of
the respondents decided that security is the main issue affecting Nigeria's internet banking
system.
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CHAPTER 5
5. DISCUSSION OF FINDINGS
5.1 Introduction
In this chapter, the findings of the results obtained in the previous chapter are discussed. The
discussion focuses on comparing customer perceptions on security. It specifically compares
the banking systems of UK and Nigeria, in terms of the services used, level of internet
banking acceptance and concerns about security. The comparison will assist in drawing
general conclusions regarding internet banking in the UK and Nigeria.
5.2 Internet Banking Services in UK and Nigeria
The research reveals a very clear difference between UK and Nigeria's internet banking
systems. Particularly, there is an enormous gap between the two countries in terms of
technological infrastructure, internet usage, security and the kinds of services offered. In
Nigeria, internet banking is still at a cradle stage. The banking websites offer services at a
basic level of interactivity, providing mainly informational services with little or no
transactional services. The informational services offered include; checking account details
and balance and general information enquiry services. On the other hand, findings reveal that
British banks offer more advanced services to their customers including both informational
and transactional services. Specifically, advanced transactional services such as opening a
current account, loan application and insurance application are delivered online.
The differences in the two countries regarding their banking industries are reflected in their
level of internet banking adoption and their technological advancement. Although, Nigeria's
banking sector is still developing and internet banking has only been adopted recently,
Nigeria is still striving to reach global standards and improving service delivery. Despite the
fact that Nigerian banks have invested much on technology and transformed from manual to
automated systems in past years, customers lack the awareness of the benefits of banking
online. However, even those that are aware of the benefits do not conduct internet banking
mainly because of factors like, low internet penetration, and fear of being exploited by cyber
criminals or other forms of fraudulent attacks. The internet penetration in Nigeria is very
slow as compared to the UK and because only a varied range of services are offered online,
customers mostly go to the bank's branch to perform their financial activities.
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On the contrary, British banks have adopted more sophisticated technologies and security
systems to help improve their service delivery. As a result, customers can easily carry out
their financial transactions in the comfort of their homes, offices etc. Subsequently,
customers in the UK visit their bank's physical branch less often and when they did, it was
mostly for making deposits, enquires or laying complaints. The result obtained show that
customers in the UK are fully dependent on internet banking. Apart from conducting services
such as transferring funds between accounts and checking account balance, they also pay bills
and shop online. The convenience and reliability of internet banking has made shopping and
bill payments easier and cost effective. Individuals can purchase items and conduct other
business transaction over the internet without any geographical barriers or time constraints.
5.3 Level of Internet Banking Acceptance
There is a huge gap in the level of internet banking adoption in the UK and Nigeria. Findings
reveal that customers banking in the UK are more willing to provide sensitive information
such as credit card, debit card and account details over the internet, telephone or fax. Whereas
customers banking in Nigeria asserted that, they would not dare provide such sensitive details
online as they consider themselves more at risk in Nigeria. Also, the same findings affirmed
that customers feel more secured banking in the UK. In retrospect of the theoretical
background on this topic, as discussed in chapter two, Nigeria is depicted as one of the most
corrupt nations, as the country is well-known for internet fraud and related crimes. This
explains the variation in the level of internet banking acceptance between the two countries.
Therefore, it can be deduced from these findings that, customers are more willing to accept
and embrace internet banking in the UK as compared to Nigeria. Despite the fact that, the
participants in this study are all Nigerian, their level of acceptance indicates that they are
willing to embrace internet banking in the UK, while, they are hesitant in doing so in Nigeria.
Thus it can be reckoned that, customers' perceived risks and trust influences the level of
internet banking acceptance in the UK and Nigeria.
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5.4 Customers' Behaviours and Concerns towards Internet Banking
Several results have been obtained in anticipation to assess the behaviours and concerns of
internet banking customers. A result indicated that, the level of security of a banks' website
determines whether the customer conducts internet banking or not. Another finding revealed
that, customers are more willing to embrace internet banking in the UK as compared to
Nigeria. A third result also revealed that customers consider themselves at risk while banking
online in general. This is to say that, customers' perceived risk is very high and that they
consider themselves at risk despite their geographical locations. Similarly, findings from
another result obtained indicated that customers' willingness to engage in online banking
anywhere depends mostly on their perceptions of risk in transacting on the internet as a whole
rather than their trust in the bank's website. This means that, even though customers may
have certain level of trust in their bank's website, they still feel insecure on the internet in
general.
This is not very surprising as the World Wide Web has now become a channel for
committing financial fraud and other related internet crimes. Also, the developments in new
technologies have made privacy and security an issue of growing concerns. Several
incidences of cyber attacks have left customers more vulnerable than ever before. Although
banks are doing their best to ensure that privacy is attained by providing authorization and
verification mechanism such as user name and password that are not easily guessed or
cracked by hackers; customers' are still very concerned about their safety on the internet. As a
result, some banks in the UK are now providing additional security measures, for example,
software to install on one's personal computer to serve as some form of protection against
hackers.
5.5 Customers' Perceptions on Security
The emergence of internet banking has brought about, various security issues. In general,
customers are still hesitant in fully embracing internet banking primarily because of security
concerns. Findings from this research reveal that customers have very high concerns about
security. The main reason for this concern is the fear of falling victim of fraud and other
related cyber crimes. The results also indicated that some of the customers have already
experienced such unfortunate incident. Although, those who have become victims have not
totally disengaged in online banking, however, they have limited their usage and their trust
level has decreased immensely.
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Despite UK banks having a more advanced banking systems and providing better security,
customers yet perceive security to be of relative concern. However, UK banks are
continuously making the effort to ensure that their customers are satisfied. As a result, they
are more willing to reimburse customers who are faced with internet fraud and related issues.
Findings reported that some of the customers who were victims of internet fraud have had
their money refunded to them. Consequently, customers trust in their bank remained strong
even though their perceived risk has amplified in the event of being exploited by cyber
criminals.
Findings also reveal that most of the customers that conduct online banking in the UK do not
carry out such activity in Nigeria. This is as a result of their perceptions on security.
Customers perceive that internet banking in these two countries differs greatly and that there
is no basis for comparison, thus revealing that only a little similarity exists between the two
countries.
5.6 Summary
There is a huge difference between the services offered in the UK and that of Nigeria.
Although the participants in this study are all Nigerians, it has been identified that they are
more willing to conduct internet banking in the UK as opposed to Nigeria. Customers also
consider themselves to be at risk while engaging in online banking. Particularly, their
perceived risk is based on the risk of transacting online as a whole rather than their trust in
their bank's website. More importantly, the research acknowledged a gap in the level of
internet banking acceptance, as it reveals that customers are more willing to embrace internet
banking in the UK than in Nigeria.
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CHAPTER 6
5. CONCLUSIONS, LIMITATIONS AND SUGGESTIONS
5.1 Conclusions
The main aim of this research was to compare customer perceptions on security in internet
banking of UK and Nigeria. It is believed that, this aim has been reached by fulfilling the
objectives set in chapter one. Therefore, an attempt has been made to ensure that these
objectives are met. Specifically, objectives one and two which are, clarification and definition
of internet banking and internet security have been depicted in chapter two and have provided
all relevant background knowledge for the successful development of this research.
Objectives three, four and five have been achieved through the literature review, while the
remaining objectives were fulfilled through primary data collected in form of questionnaires.
The data collected have been analyzed, and then critically discussed in order to fulfil the core
aim of this research which was to identify and compare customer perceptions on security and
asses customer behaviours and concerns towards internet banking. From the comparisons, a
number of conclusions have been drawn. British and Nigerian banks have both adopted
internet banking systems. However, British bank deliver advanced services which include
more consistent and wide ranging information delivery services, along with a comprehensive
range of transactional services through their websites. In Nigeria, banks deliver basic services,
with the website providing mostly information delivery services with little or no transactional
services.
Moreover, British banks appear to be more innovative and advanced in terms of information
technology infrastructure, telecommunication infrastructure, level of internet penetration and
security technologies thus, achieving higher customer satisfaction, customer retention,
competitiveness and a global reach. As a result, customers in the UK are more inclined to
carry out financial transactions online and are less concerned about security. On the contrary,
Nigerian banks seem to be lagging behind because of lower level of internet penetration and
lack of advanced technological tool. Also, internet banking in Nigeria has only been recently
introduced and therefore, the country is still at a developing phase. Consequently, customers
are hesitant in embracing internet banking and are generally insecure.
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The main reasons for banking online have been obtained through the primary data collected.
It has been identified that customers conduct online banking mainly because it is convenient
for them. In addition, the accessibility, speed and security of the bank's website are also
among the reasons that influence the adoption of internet banking. As a result of these
benefits, customers have cut back in their visits to the traditional bank branch and only visited
when they want to make cash and check deposits or lay complaints. Other forms of internet
banking, such as telephone banking and ATMs have also been assessed. In UK, customers
use the ATM more often than telephone banking or internet banking. However Nigerian
customers do not use ATM as much while telephone banking services are not provided in
majority of the banks in Nigeria.
In comparing the perceptions of customers on security and their behaviours and concerns;
customers consider themselves at risk in general. However, customers are more concerned
about the risk in transacting on the internet as a whole rather than the risk associated in using
their bank's website. That is to say that; the bank's website does not influence whether an
individual conducts internet banking or not. Furthermore, customers banking in Nigeria
appear to be more cautious in engaging with the internet bank. This may be the reason why
Nigerian banks are reluctant in implementing transactional services. On the other hand,
customers in the UK seem be unconcerned about security because banks have established a
certain level of trust in which customers recognized to be satisfactory.
Finally, although it can be seen visibly that Nigeria currently lags behind United Kingdom, it
is believed that the situation will change given that Nigeria is one of the fastest growing in
information and telecommunicate technology in Africa. However, the issue of security in
Nigerian banks might take a reasonably long time before it can be fully resolved because the
issues are not limited to the banking industry. Nigeria's government have to recognize that
internet banking and issue regarding internet fraud are a matter of economic relevance and
have to modify the guidelines for internet banking to address issues related to fraud and
internet crimes.
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5.2 Limitations of Study
The research is limited by the non-probability sampling used. It is particularly limited to a
small number of Nigerians living in Sheffield. As a result, findings obtained from this
research cannot be generalized. The study has successfully examined the internet banking
systems of United Kingdom and Nigeria. And has attempted to examine and compare
customers' perceptions on security. However, because the research is based on exploring
customer perceptions, the banks' perspectives have been ignored. This may have affected the
consistency of the research findings. Additionally, the research was solely dependent on
questionnaires; hence, this has limited the number of questions asked thereby affecting the
accuracy of the findings. Finally, internet banking is a rapidly growing and changing industry,
thus information related to such topic had to be extremely thorough and up-to-date. Perhaps,
use of literature that is not more than two years old would have helped in achieving better
result.
5.3 Suggestions for Future Research
Internet banking is a rapidly changing industry, and its development has brought about
continuous growth in internet related crimes. Consequently, a broader research on this topic
can help address issues related to security. Further research in this area can focus on the
business aspect of internet banking and security. In particular, it can investigate banks'
perceptions on security and examine the types of security technologies implemented in these
banks. Alternatively, a more technical research can be conducted; by exploring various
security measures implemented on bank websites; and examining online transaction and
payment systems.
Furthermore, in achieving a more complete result to this particular research, other approach
to data collection can be considered. For example; use of interviews and focus groups might
yield a better understanding of participant's attitudes and behaviours towards internet banking.
Lastly, the research could also use response from British citizens as well as Nigerians so as to
gain a useful insight on their perceptions and their attitudes and concerns.
Word Count: 15,943
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APPENDICES
Appendix I: Information Sheet
Dear Participants,
I am a postgraduate student at the University of Sheffield. I am currently conducting a
research on customer perceptions on security in internet banking. The research aims to
investigate the perceptions of internet banking customers in terms of security.
I am looking for participants that engage in internet banking to gather their views and
experiences in banking online. It will take approximately 10-15 minute to answer the
questions. No personal or confidential question would be asked, and all responses obtained
will remain anonymous. Participant should understand that participation is voluntary and may
choose not to answer any question if uncomfortable. Also, the research is carried out in
accordance with the University of Sheffield's Ethics Committee.
In the event of any doubts or complaints arising, should anything go wrong during the course
of your participation in this study, please contact the University Registrar or my supervisor at
the email address provide below.
Professor Val Gillet – [email protected]
Your response would be very much appreciated. Thank you.
If you require further details about this research, please feel free to contact me
Fatima Guba - [email protected]
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Appendix II: Questionnaire
Customer perception on security in internet banking: a comparative study between
Nigeria and UK
I understand that by answering this questionnaire I have agreed to take part in the
research study.
Your participation in this study is greatly appreciated
Please circle or tick the appropriate answer(s) in all sections
Section A: General Question(s)
1. Are you?
Male Female
2. How old are you?
16-20 21-30 31-40 40 or above I prefer not to answer
3. How long have you been in the UK?
Please specify…………………………
Section B: Internet 'Online' banking; allows customers to conduct a wide range of
electronic transactions on a secure website operated by their retail or virtual bank and
building society.
4. Are you an internet banking Customer?
a. Yes
b. No
5. If yes, how often do you conduct internet banking?
a. A lot
b. Quite a lot
c. Not sure
d. Not much
e. Never
6. Why did you choose to bank online? (Please choose one or more answers if
necessary).
a. Convenience
b. Accessibility
c. Ease of use
d. Speed
e. Better rate
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f. Lower service charge
g. cost
h. Security
i. All of the above
j. Other (please specify)……………………
k. None of the above
7. How frequently do you use telephone banking services per month? (For example
balance inquiry, fund transfer etc.).
a. Less than 1
b. 1 to 3 times
c. 4 to 8 times
d. 9 to 12 times
e. Over 12 times
8. How frequently do you use automated teller machine (ATM) per month?
a. Less than 1
b. 1 to 3 times
c. 4 to 8 times
d. 9 to 12 times
e. Over 12 times
9. How frequently do you visit your bank branch per month?
a. Less than 1
b. 1 to 3 times
c. 4 to 8 times
d. 9 to 12 times
e. Over 12 times
10. What is the main reason that you visit your bank branch? (Please choose single most
important reason).
a. Make deposit
b. Balance inquiry
c. Cash check
d. Cash withdrawal
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e. Complaints
f. Make other inquiries
g. Other (please specify)………………………
h. None of the above
Section C: Information or 'internet' security means protection of sensitive data from
online security breaches (such as fraud, hackers, password crackers etc.).
11. Does your bank provide advice on security?
a. Yes
b. No
c. Don't know
12. Does your bank allow you to create your own user name and password?
a. Yes
b. No
c. Don't know
13. Does your bank provide additional security measures? ( For example; A software that
you can install on your personal computer).
a. Yes
b. No
c. Don't know
14. How concerned are you about security while banking online?
a. Extremely high
b. High
c. Medium
d. Low
e. Never
15. What are your concerns mainly about?
a. You are afraid someone might get access to your account
b. You do not trust the level of security of your bank
c. Other (please specify)……………….
16. Have you ever been affected by internet fraud? (If No, please proceed to section D)
a. Yes
b. No
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17. If yes, how many times?
a. 1 to 2 times
b. 3 to 4 times
c. 5 to 6 times
d. Over 7 times
18. How did you react to it?
Please describe briefly.......................................
19. Did that stop you from engaging further in internet banking?
a. Yes
b. No
20. What did your bank do to resolve this issue?
a. Provide refund
b. Replace your debit/credit card(s)
c. Implement new security measures
d. Other (please specify)……………………….
21. How satisfied were you with their response?
a. Very satisfied
b. Satisfied
c. Neutral
d. Unsatisfied
Section D: Internet Banking in Nigeria and UK (For Nigerian participants)
22. Do you conduct internet banking in Nigeria? (if yes please proceed to the next
question)
a. Yes
b. No
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23. How does internet banking in UK differ from that of Nigeria?
a. Greatly
b. Only a little
c. No difference
d. Other (please specify)……………………
e. Don't know
24. Which of the following online services are you aware of that are provided by banks in
Nigeria (You can circle/tick as many as possible)
a. Check account balance
b. Check account transaction
c. Account details
d. Check historical records
e. Bill payments
f. Transfer funds
g. Standing order/Direct debit
h. View credit card balance
i. Credit card bill payment
j. Order cheque book
k. Order/print statement
l. Send messages
m. View credit balance
n. Other (please specify)………………………
o. None of the above
25. Which of the following online services are you aware of that are provided by banks
in the UK (You can circle/tick as many as possible)
a. Check account balance
b. Check account transaction
c. Account details
d. Check historical records
e. Bill payments
f. Transfer funds
g. Standing order/Direct debit
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h. View credit card balance
i. Credit card bill payment
j. Order cheque book
k. Order/print statement
l. Send messages
m. View credit balance
n. Other (please specify)………………………
o. None of the above
26. Which of the following advanced online transactional services are you aware of, that
are offered in Nigerian banks?
a. Open current account
b. Apply for loan
c. Apply for mortgage
d. Apply for savings account
e. Apply for insurance
f. Other (please specify)…………………….
g. None of the above
27. Which of the following advanced online transactional services are you aware of, that
are offered in UK banks?
h. Open current account
i. Apply for loan
j. Apply for mortgage
k. Apply for savings account
l. Apply for insurance
m. Other (please specify)…………………….
n. None of the above
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28. Have you noticed any similarities in the internet banking services of UK and Nigeria?
a. Yes
b. No
c. Don't know
Section E: Please indicate whether you agree or disagree with the following statement.
29. I am willing to provide credit/debit card details over the internet in the UK.
Strongly agree Agree Neutral Disagree Strongly disagree
30. I am willing to provide credit/debit card details over the internet in Nigeria.
Strongly agree Agree Neutral Disagree Strongly disagree
31. I am willing to provide credit/debit card details over the telephone in the UK.
Strongly agree Agree Neutral Disagree Strongly disagree
32. I am willing to provide credit/debit card details over the telephone in Nigeria.
Strongly agree Agree Neutral Disagree Strongly disagree
33. I am willing to provide credit/debit card details via fax or email in the UK.
Strongly agree Agree Neutral Disagree Strongly disagree
34. I am willing to provide credit/debit card details via fax or email in Nigeria.
Strongly agree Agree Neutral Disagree Strongly disagree
35. In general, I consider myself to be at risk while engaging in internet banking.
Strongly agree Agree Neutral Disagree Strongly disagree
36. In general, the level of security of a bank's website determines whether I conduct
internet banking or not.
Strongly agree Agree Neutral Disagree Strongly disagree
37. My willingness to engage in online banking anywhere depends solely on my
perception of risk in transacting on the internet as a whole rather than my trust in the
bank's website.
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Strongly agree Agree Neutral Disagree Strongly disagree
38. I think security is one of the main issues affecting Nigeria's internet banking system.
Strongly agree Agree Neutral Disagree Strongly disagree
39. I think technology is one of the main issues affecting Nigeria's internet banking
system.
Strongly agree Agree Neutral Disagree Strongly disagree
40. I feel more secure while banking online in UK as compared to Nigeria.
Strongly agree Agree Neutral Disagree Strongly disagree
41. In general, banks could gain customer trust by increasing security awareness through
educating their customers.
Strongly agree Agree Neutral Disagree Strongly disagree
Thank you for your participation!
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