PROJECT PROPOSAL

REPORT PRESENT ON

The Prospect of implementing E commerce in commercial Banking: A Case study of Janata BanK Limited

PROJECT PROPOSAL

Title:

The Prospect of implementing Ecommerce in commercial Banking: A Case study of Janata Bank Limited.

Date of Submission :

.2011

Proposal Submitted By:

Mohammad Kamruzzaman SID No.08-2-71-812-002 CEMBA Program Tutorial Centre: Dhaka RRC School of Business, Bangladesh Open University

Supervised By:

Counter Signed By:

Mr.Shahidul Islam Fakir Asstt. Professor & Tutor CEMBA/CEMPA Program Bangladesh Open University

Md.Jakir Hossain Coordinator CEMBA/CEMPA Program Bangladesh Open University

APPROVED BY:
Dean

School of Business

Bangladesh Open University

Introduction
COMMONWEALTH EXECUTIVE MASTERS OF BUSINESS ADMINISTRATION (CEMBA) Program of Bangladesh Open University, I have to prepare a project Report which is the Core Course requirement of the program. I seek permission to be assigned by the university to prepare master paper under the kind supervision of Mr.Shahidul Islam Fakir, Asstt. Professor & Tutor of CEMBA/MBA Program. I am intended to work according to the instructions and guidance of his kind Supervision to have a creatable project paper on The Prospect of implementing Ecommerce in commercial Banking: A Case study of Janata Bank Limited. This study will analyze the prospect of implementing ecommerce in commercial Banking. This study will investigate the factors that constraint Ecommerce application in commercial banking. I will state the background of the study, review of the problem, aims and objectives of the study, scope of the study, methodology, nad the significance of the study.
STUDENT OF

As a

Back Ground
Ecommerce generally includes the tasks that support buying and selling of goods and services and interaction between this tasks. In easy word, providing services or options to buy and sell through electronic network, can be defined as Ecommerce. Bank as a financial institute it sells services and provides options to the clients or customers by improving customer relationship and eliminates constraints of place and time. It is a fast expanding business process where buyers and sellers staying at a far distance can communicate easily and directly reducing the constraints of time and place. Because, consumer behavior is changing partly because of more spare time. The way of use of financial services is characterized by individuality, mobility, independence of place and time, and flexibility. Financial transactions caused by purchases will more and more be carried out by non and near banks. These facts represent big challenges for the banks and other related financial services providers. To face this

challenge, banks started the `Internet as an `Strategic Weapon for creation of new distribution channels. I this study we will evaluate the following items. Internet as a distribution channel. Areas of use of the internet in financial institutions. - Information presentation - Internet Transactions. Digital coin based money. Required system for E-banking. The use and implementation of information technology and electronic media varies from one bank to another. But the goal is the same and that it is an initiative for the development of banking and modernization of transaction in comparatively more secured way. Electronic Commerce in banking or EBanking are used for managing financial and commercial activities in bank between business-to business(B2B) and business-to customer(B2C). Banking is one of the most information intensive sectors and is an ideal domain for the successful development of Ecommerce. Internet banking refers to the use of the internet as a remote delivery channel for banking services. In our country the use of E-banking becomes popular since 1990. Nationalized commercial banks were unaware over the issue. But the increased popularity of E-banking attract the NCBs to get adopt the most modern technology of banking. Now The Janata Bank Limited is on the way of involving consumers using internet to access their bank account and to undertake business transactions. Janata Bank Limited is entering to the internet banking in two different ways. First, the existing bank with physical offices can establish a web site and offer Internet banking in addition to its delivery channels. Secondly, the bank may be established a branchless, Internet or virtual bank. For entering to the Internet banking Janata Bank Limited is developing their own website. A web site plays a very significant role in Internet banking .It should be able to convey all the information for both current customers and potential new one via the Internet. A well designed website creates an interest in the firm and its offerings, and it should also offer the users opportunities to reconstruct the website in their minds so that it matches their cognitive structure.

This concept encompasses all aspects of the bank with which the consumer may interact, including its personnel, its physical facilities, and other tangible elements, during a given period. It involves both interpersonal and non-human interactions with service providers. To date, few research studies have paid attention to customers perceptions of service quality in Internet banking, perhaps due to the view of the Internet as remote technological format change only.Yet,Zeithaml (2000) indicates that ,although there is no direct human contact in remote services, each service elements provided represents an opportunity for the firm to reinforce or establish quality perceptions for customers. Given the wealth of opportunities that the Internet creates for financial institutions, having a strong on-line presence is becoming a strategic necessity for most of them and raises the importance of the Internet as a strategic distribution channel for providing banking services. According to Mols (2001), there has been a considerable growth in the segment of consumers preferring Internet banking due to the increase in computer literacy, the availability of computers and the reduction in the costs of PCs and Internet access. This fact will change the optimal distribution structure for most banks and financial institutes. Especially in Bnagladesh, although the use of Internet is not the expected one, Internet banking continues to increase because of Internets easiness in use, its low cost and the requirement from some public authorities to only receive online payments. Due to changes in the banking sector and expansion plans in Bangladesh, local banks are trying to strengthen their position in the market and improve their efficiency. Following this course the Janata Bank Limited is trying to find new distribution channels and methods of providing their services in order to maintain and increase their share in the market. An appealing method of doing that is through the Internet because it can offer banking services at cheaper prices to more potential clients and the transactions can be carried out from anywhere in the world at any time of day or night. This means that by using Internet technology, financial institutions can establish a direct link to customers and improve their market shares while increasing their profits, without paying the high cost of building new branches.

Objective of the study :

The primary objective of this study is to examine the Prospect of implementing Ecommerce in commercial Banking as a perspective view of Janata Bank Limited. To address this objective, the I would like to explore the nature of e-commerce: its benefits and advantages to commercial Banking, the requirements for its implementation, the factors to be considered in developing Internet-based services, and its maintenance. Afterwards, characteristics of the natural practice environment of banking in Janata Bank Limited that affect the success of e-commerce are discussed. The effectiveness of e-commerce to commercial Banking is determined through the evaluation of banking practices which already implemented e-commerce. The changes in their market share, the quality of their products and services are examined. Moreover, this study shows how commercial Bank deals with important issues in e-commerce such as concerns in security. A survey is conducted to managers to determine what affects the success of implementing e-commerce to their regular banking practices. An interview takes place to know what are their problems and concerns regarding the application. As customers largely determine the survival of a business, I shall interview customers to assess their perception on e-commerce. Finally, this research comes up with pertinent findings, and provides insightful recommendations on ecommerce application to Janata Bank Limited. E-commerce has proven to be effective in commercial banks business as there is increase in market share. The study wills attempts to answer the following questions: a. How applicable is e-commerce to Janata Bank Limited? b. What are the factors that affect the success of e-commerce to Janata Bank Limited? c. What measures should be done in developing e-commerce to Janata Bank Limited? This study will be helpful to banking practitioners for this will be a guide for them when they employ e-commerce systems to their businesses. By examining the risks and other factors involved in e-commerce the bank will be able to design measures to minimize the risks. Further, through the

understanding of the needs of their customers in terms of security and satisfaction, this study will help the bank in the process of implementing e-commerce. Moreover, this study will be a significant endeavor in promoting e-commerce awareness among consumers who are still hesitating to shop online through banking. This study is deemed useful for future researchers on ecommerce and its application to commercial banking.

Methodology
For this study, primary research and secondary research are be used. Primary research is conducted using questionnaire surveys that are sent to bank managers who are in the process of implementing e-commerce or e-banking. The primary sources of data came from the surveyquestionnaire and interviews conducted. The secondary sources of data were based on published articles from business and IT journals, books and related studies on the Internet, ecommerce and its application to commercial banking. During data gathering the choice and design of methods are constantly modified, based on ongoing analysis. This study will also employ qualitative research method because it will try to find and build theories that will explain the relationship of one variable with another variable through qualitative elements in research. Through this method, qualitative elements that do not have standard measures such as behavior, attitudes, opinions, and beliefs within the ecommerce domain will be analyzed.

Primary Sources
For general concept development about the bank short interviews and discussion sessions were taken as primary source. More over a market survey was conducted with a specific questioner. To identify the implementation, supervision, monitoring and practice- interview with the

employee and extensive study of the existing file was and practical case observation was done.

Secondary Sources
The information for the Organization part of the report was collected from secondary sources like books, published reports and for website gathering of concept of JBL e(www.janatabankbd.org) commerce of JBL.

Sampling
For the survey, cluster sampling was thought to be appropriate. The e-commerce practices of JBL can be categorized into four clusters1
2

General Banking (Deposit & Marketing functions) Trading Businesses (Commercial Lending) Foreign Trade (Import & Export) Remittance (Foreign & Local) Within the clusters, random sampling was conducted

3 4

according to advantage of the surveyor and also considering the time factor. The sample size for each cluster was determined as per the ratio of the total populations of the clusters. The total sample size was limited to 200.

Limitations
This research study only covers the application of ecommerce to Janata Bank Limited as there are numerous studies on large and modernized banking sectors. The outcome of this study is limited only to the data gathered from books and journals about e-commerce and from the primary data gathered from the result of the questionnaire survey and interview that will be conducted by the researcher. Internet banking is a new business. There are plenty of issues, which need to be explored from various perspectives. The present study has lot of limitations. The mock-up size is very limited; therefore, a big sample size is attractive to accurately evaluate the perception of customers services in Internet banking. There are still many issues for further study to conquer the important role of Internet banking in developing countries. So, I would like to suggest for further research.

References
Bacchus, L. Molina, A. (2001) Internet-based tourism services: Business Issues and trends. Futures, Vol. 33. Bloch, P.H. ,1982, An exploration into the scaling of consumers involvement with a product class, in Monroe K.B., eds., Advances in Consumer Research, 8, Association for Consumer Research, Provo, UT, 61-5. Cabbar, Y. (2000) Black-Sea Economic Cooperation Workshop on Internet, E-commerce and SMEs. Speech delivered at the Heaquarters of the BSEC Permanent International Secretariat, Istanbul, Turkey, 2 May. Available at [www.unce.org]. Accessed [01/10/03]. Cobanoglu, C., Ekinci, Y., & Park, J. (2003) An Empirical Analysis of Internet Users Intention to Purchase Vacations Online. Available at www.ttra.com]. Accessed [12/08/03].

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