Chapter 71 The Impact of Internet Adoption on the International Marketing of the Jordanian Banking Sector: Some Emerging Practices

Said Al-Hasan

University of Glamorgan, UK

Brychan Thomas

University of Glamorgan, UK

Ayman Mansour

University of Glamorgan, UK

ABSTRACT

The research aims are to explore the extent of the banking sector’s adoption of Internet applications in Jordan for marketing products and to identify the impact of such adoption on developing international markets.

DOI: 10.4018∕978-1-4666-6268-1.ch071

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INTRODUCTION

This chapter considers the impact of adopting the Internet on the international marketing of the Jordanian Banking sector in terms of emerging practices. The main function of the marketing of business organisations is to make the important connection between the introduction of appro­priate products that satisfy customers’ needs and contributing to achieving the goals of the organisation.

Information and Communication Technology (ICT) has brought about fundamental changes to many sectors in developing countries and the sec­tors in these countries have benefited considerably from the enormous and rapid changes taking place in the field of Information Technology (IT). Obvi­ously, the banking sector in developing countries has a large financial potential, which can be used to invest in IT. Additionally, growing competition between banks at national and global levels has required significant expansion of their IT opera­tions. This has been in concert with the sweeping wave of financial innovations which have been launched in recent years leading to fundamental changes in the processes of investing money and creating many new financial products and services.

This study has used quantitative research and descriptive statistical analysis involving the distribution of a questionnaire to branches of banks in Jordan. The statistical software package SPSS has been used to analyse the data and test the hypotheses and from the findings a series of recommendations have been formulated for the upgrading of the banking industry in Jordan.

The key results from the statistical analysis show that the Jordanian banking sector’s adoption of the Internet has an impact on the international clients’ commitment towards the banks and the international banking services have differed according to the size of the banks. Also, it has been found that the quality of the international banking services have differed according to the banks’ experiences.

In order to study the impact of Internet adoption on the international marketing of the Jordanian banking sector (Al-Fayoumi & Abuzayed, 2009) this chapter initially investigates Internet banking in Jordan which is one form of electronic banking (e-banking) in the country. E-banking is defined as “the use of electronic channels to communicate and transact business with both domestic and interna­tional customers, primarily through the use of the Internet and the World Wide Web” (McDowell, 2002, p. 40). Currently, there are three basic kinds of Internet banking that are employed in the market place and these are information, communication and transaction (Pereummal & Shanmugan, 2004, pp. 80-90). Wang et al. (2003) conducted a study based on a sample of 123 users in Taiwan, which aimed to identify the factors that determine ac­ceptance of Internet banking by users. Perceived ease of use, usefulness and credibility were found to be significant antecedents of the intention to use an Internet banking system. The individual difference variable (i.e. computer self-efficacy) was found to be an important determinant of perceived ease of use, usefulness and credibility of Internet banking. People with higher computer self-efficacy were more readily prepared to use Internet banking services. Rotchanakitumnuai and Speece (2003) conducted a qualitative study to explore the barriers to Internet banking adoption based on qualitative interviews with Thai firms. It was found that trust in the Internet was a criti­cal issue inhibiting adoption, including worries about security of the system, low reliability of transactions, and distrust of the service provider.

In Jordan, the banking sector has endeavoured to keep pace with global developments, and has shown considerable interest in modern technical applications especially in the field of communica­tion networks. The banking industry has, therefore, sought to carry out the automation of processes linking branches and providing benefit through technological advancement in terms of automated services. Due to limited research into the adoption of the Internet for the international marketing of the banking sector in Jordan the chapter seeks to explore the impact of such adoption on the marketing of banking sector’s products at an international level and the emerging practices that are evident. The study also seeks to determine the major obstacles limiting the banking sector in terms of the marketing of its products internationally through the Internet. The chapter provides recommendations conducive to an effective and optimal implementation of In­ternet applications for the international marketing of the banking sector in Jordan.

BACKGROUND

The presentation of the literature review below on the impact of Internet adoption on the international marketing of the Jordanian banking sector has been linked and the relationships between different levels of the literature illustrated according to the following sections: “Marketing Jordanian Banking Services,” “The Banking Sector in Jordan,” and “E-Banking Transactions and Services in Jordan.”

Marketing Jordanian Banking Services

In the Kingdom of Jordan the real implementation of marketing within banking organisations has taken place only very recently compared to other sectors within the country.

The Jordanian banking industry today is in the middle of an information technology (IT) revolution involving technology changes which have created greater competition among the banks and this has led to increasing banking automation. Traditional branch-based banking remains the most widespread method for conducting bank­ing transactions as evidenced in other countries. However, the considerable advances in technology, deregulations, globalisation, and liberalisation measures have resulted in a completely new operat­ing environment for banks. Services and products like tele-banking, Internet banking (Baraghani, 2007; Celik, 2008; Hernandez et al., 2007; Sat- tabusaya et al., 2007; Zheng, 2010), Web banking (Casalo et al., 2008), e-banking, online banking (Han, 2008), etc., have become buzzwords with the banks endeavouring to cope with competition by offering innovative and attractive packaged technology based services to their customers (Akram & Asghar, 2012; Musiime & Ramadhan, 2011; Sorournejad & Monadjemi, 2011).

The Banking Sector in Jordan

The banking sector in Jordan consists of the Central Bank of Jordan (CBJ), private banks, special -credit institutions and money-exchange companies. Banks operating in the Kingdom are distributed according to sixteen national banks including two banks working according to Islamic Sharri’a, two Arab banks and three foreign banks. These banks practice their activities through 449 branches and 154 offices. However, there were 139 bank branches and representation offices for the Jordanian banks operating abroad by the end of 2008 including 58 branches in Palestine (Central Bank of Jordan, 2008).

In Jordan the majority of banks have moved steadily towards Internet banking and these banks have tried to introduce Internet-based e-banking systems (Casalo et al., 2008; Riyadh, 2009) to improve their operations, reduce costs and meet customers’ demand and to deal with increased competition. Banks started Internet banking initially with simple functions such as information gather­ing about interest rates, checking account balances and computing loan eligibility. Services were then extended to online bill payment, transfer of funds between accounts and cash management services for corporations. Following this banks have facilitated payment for e-commerce transactions by directly debiting bank accounts or through credit cards.

Financial and banking services offered by the Jordanian banks, which are marketed and sold on the Internet through e-commerce channels, include sophisticated financial and banking ser­vices. Banks’ Web sites on the Internet contain promotional information and pictures intended to facilitate and consolidate contacts with customers and identify their views and needs. Such informa­tion includes introducing the bank’s achievements, a description of the bank’s activities and the overall services marketed by the bank (Mash’al & Abbas, 2002, p. 77-88). These services include opening different types of accounts, enquiries about the source, transfer from one account to another, paying invoices for household and commercial services, loans services, buying and selling foreign currencies, issuing different credit cards, buying and selling traveller’s cheques, financial brokerage services, executing purchase orders and selling shares, along with trade financing operations and guarantees.

It has been found that Jordanian banks have been successful in the introductory phase of Web banking at a basic level including institutional and promotional information, but they have not fully utilised the concepts and applications of Web bank­ing at intermediate and advanced levels compared to developments in international markets. Some of the commercial banks in Jordan offer e-banking services (Casalo et al., 2008; Riyadh, 2009).

For this study, a sample of banks has been ran­domly chosen which provide a sample of services offered and how these are related to e-commerce has been investigated. These banks include the Arab Bank (AB), Jordan Kuwait Bank (JKB), Jordan National Bank (JNB) and the Citi Bank (CB) (Royal Jordanian Society, 2002). The Arab Bank is the Amman-based Arab Bank, Jordan’s first institution in the private sector in the Arab world. The Arab Bank is ranked as one of the largest global financial institutions as listed by Fitch (A-), Standard and Poor (A-) and Moody (A3). The capital base of the Arab Bank is US $6.9 billion in total assets of $38.3 billion and income before tax of 1001.1 million dollars in 2007. A sample of electronic services offered by the Arab Bank includes Internet banking (the Arab bank was the first to launch Internet banking services in the country), Internet shopping card (ISC), mobile bank and WAP banking.

The Jordan Kuwait Bank was established in 1976 in Amman as a Jordanian joint investment between Jordanian and Kuwaiti investors and investors from other Arab countries. The group of investors had the idea of attracting capital from Kuwait to invest in Jordan which was known for its efficiency and the development of its workforce. The investment and development opportunities offered by Jordan were based on certainty of success and the Jordan Kuwait Bank is one of the few projects that have been established and through joint Arab contributions it has been able to continue successfully. The Jordan Kuwait Bank offers electronic services including on-line stock trading and the bank offers this service in col­laboration with its affiliate organisation the United Financial Investment Company (UFICO). The service allows JKB customers to trade in Amman through UFICO’s Web site and settle the value of shares traded through JFK’s Internet banking service directly from their accounts with the bank. Other services include Net Banker for performing banking transactions and Cyber branch which is a comprehensive electronic bank providing services directly to clients on a 24 hour basis.

The Jordan National Bank Plc was one of the earliest national banks to be established in Jordan in 1955. It operates 54 branches and offices in Jordan, 35 of which are in the Greater Amman area including Al Ahli International Bank, a subsidiary 85.5% owned by the Jordan National Bank, the international banking unit in Limassol-Cyprus, and 5 branches in the West Bank. The bank’s principal activities include retail and corporate banking services, such as deposits and all prin­cipal foreign currencies, lending, trade finance, foreign exchange and credit cards. The Jordan National Bank is regarded as a retail bank with a strong market position and customer base and it offers central banking services such an E-com card which is a pre-paid electronic card, which allows purchase of the World Wide Web, the phone and mail order.

The Citibank N.A. (‘Citi ’) was first established in Jordan in 1974 and it is now a fully licensed commercial bank with two branches located in the capital city, Amman. They have approxi­mately 70 employees based in Jordan, which are responsible for Citi’s business in Jordan, Syria and the Palestine National Authority, and they are presently the only commercial US bank in the country and the only global foreign bank with senior local management. A sample of electronic services offered by Citi Bank include on-line bank statements (the customer can access online bank statements on time), online bill payments (the bank offers two services: a safety check and checking plus), and wireless alert (the customer can use Citi Bank’s free wireless alerts to receive information on their text-enabled digital cell phone at any e-mail address).

According to Mash’ al and Abbas (2002, pp 77­88) banking transactions in Jordan have progressed through four phases. The first phase began with communication through the Internet only using e-mail and browsing the Internet. The second phase took the form of a Web site for promoting the bank. The third phase proceeded making an advanced step through linking the website with other websites and exchanging information either with foreign or internal systems. Finally, the fourth phase involved making full banking transactions.

E-Banking Transactions and Services in Jordan

Many Jordanian commercial banks have shown an interest in e-banking and have invested a considerable part of their public expenditure for providing sophisticated electronic financial and banking services (e-banking). This tendency has led to reducing the cost of banking operations and promoting the local banking market. A system has been introduced connecting the ATM systems of licensed banks through a joint network (JONET) which enables customers to receive banking services at any time. Jordanian banks have been linked to the international payment systems such as VISA and Master Card where holders of such cards can use them to pay for purchases directly out of their accounts through points of sales outside the Kingdom. They have also been able to provide banking services through a number of e-channels including home banks and the phone and mobile banks. Other banks have provided banking and financial services through a number of call centres, automated banks and Internet bank­ing. Since Jordan has assumed a leading role for countries in the Middle East, with rapid growth rates in the use of Visa credit cards, it is expected that the Kingdom will have considerable growth in banking services.

There have been a number of drivers for Internet banking in the Jordanian banking systems involv­ing increased investments in e-communications technology with greater access to e-commerce through the Internet. There has been reduction in the cost of banking operations by providing bank­ing services on an ongoing basis without need for human involvement which has reduced the cost of banking service procedures. This has reduced the operational costs and other administrative expenses. By coping with regional and interna­tional competition the Jordanian banking sector is expected to face strong competition following international agreements and arrangements. In the light of these the Jordanian market will be open to regional and international competition. This means that there will be strong competition with foreign banks wanting to operate in Jordan. In order to face up to competitive international banks in terms of investing in, and adopting, banking technology, improving transactions using financial and mon­etary instruments, and upgrading Web sites on the Internet, the Jordanian banks will have to access and develop financial and monetary services and products which depend on international automated technologies like the Internet. By doing this the Jordanian banks will be able to retain a reasonable share of banking services.

Many customers prefer to process their banking transactions from their offices or homes at any time of the day without having to stand in long queues to obtain a particular banking service. Most businessmen prefer to carry out their banking transactions including the opening of documen­tary credits and financial brokerage works on the Internet while they are at work whereby they can reduce the costs and time involved. The banking sector in Jordan has for the past few years realised the importance of the developments in the field of communications technology and its impact on international banking business. Jordanian banks are undertaking to understand and apply technol­ogy to the services they provide. However, it is apparent that despite these banks’ awareness of the importance underlying the need to provide financial and banking services, through the In­ternet and e-commerce to reach a new and wider customer base, the steps made have been slow. Jordanian banks with websites have tended to use these in the past only for promoting their services and not for using services on the part of customers for completing their transactions.

According to the Jordan Kuwait Bank (2008), banking services cannot be produced in advance or stored and are intangible. The bank, branch or employee cannot produce samples that will be put on-show to clients before selling. The banking service is provided once the client’s needs, require­ments and capacities have been ascertained and it is produced and delivered (sold) simultaneously. The product quality can often be verified by the clients after sale through a feedback process in­tended to ascertain the extent to which the service satisfies customer needs.

The Internet has made fundamental changes to the basic principles of transacting business. The implications and effects of these developments on business marketing might be even more significant. What is clear about these developments is that some of the basic tenets of marketing are being called into question. This part of the study sheds light on the application of the Internet in bank marketing and the impacts of such applications on the marketing mix elements. It can be argued that the traditional concept of marketing is no longer adequate to meet the increased demands of customers and the ever-changing competitive business environment. Therefore, it is necessary for banks to adopt new strategies to achieve competitive advantage (Al-Rousan & Qawasmeh, 2009) by integrating customer relationships and developing interactive marketing.

RESEARCH METHODOLOGY

The research aims are to explore the extent of the banking sector’s adoption of Internet applications in Jordan for marketing products and to identify the impact of such adoption on developing interna­tional markets. This study also aims to determine the major obstacles restraining banks marketing their products internationally through the Internet and to make recommendations conducive to an effective and optimal implementation of Internet applications for marketing bank products locally and internationally. The main research problem is the absence of a clear and comprehensive under­standing of the banking sector’s adoption of the Internet in Jordan to market products and services and the impact of such adoption on marketing products. Arising from this the research question is - does the adoption of Internet applications by the Jordanian banking sector affect the marketing of products at an international level? This study used a quantitative analytical research method and descriptive statistical analysis involving the distribution of a questionnaire to branches of banks in Jordan. The statistical software package SPSS was used to analyse data and test hypotheses and from the findings a series of recommenda­tions were formulated for upgrading the banking industry in Jordan. A population frame included banking organisations in Jordan and a research sample of 19 banks was used involving an inclu­sive field survey. For the unit of analysis the study analysed information and data gathered through the questionnaire which was distributed to man­agers and other personnel involved in marketing at banks. Questionnaire forms were submitted to managers, officers and other personnel involved in marketing on the Internet regardless of their job titles in the departments of marketing and sales, public relations, finance, computing, information technology and information systems, electronic services, research and development. The three types of variables were independent, dependent and moderating variables. The independent vari­able was the adoption of the Internet by banks in Jordan. The variable was measured according to developing services’ quality, pricing, distribution and promotion. The dependent variable was inter­national marketing and the moderating variables were size (assets), experience (number of years) and the presence of branches abroad. SPSS was used to analyse the data and test the hypotheses. Statistical methods used to analyse data and test hypotheses were frequency rates and percentages relevant to the questionnaire, standard deviations and means, and multiple regression analysis.

The null and the alternative hypotheses inves­tigated in this study are:

Hypothesis 1:

Ho: The banking sector’s adoption of Internet applications in Jordan does not affect the international banking services’ quality, prices, distribution and promotion.

Ha: The banking sector’s adoption of Internet ap­plications in Jordan affects the international banking services’ quality, prices, distribution and promotion.

Hypothesis 2:

Ho: The banking sector’s adoption of Internet applications in Jordan has no impact on the international clients’ commitment towards the bank.

Ha: The banking sector’s adoption of Internet applications in Jordan has an impact on the international clients’ commitment towards the bank.

The results of the analysis of the data and the testing of the hypotheses are reported in the findings.

FINDINGS

The findings of the study are reported according to the adoption of Internet applications, the impact of the Internet and obstacles facing the banking sector’s adoption of the Internet in Jordan and the marketing of services internationally. In order to determine whether the banks had, or had not, been adopting Internet applications within the elements of the marketing mix this was investigated for service development, pricing, distribution and promotion of banking services.

Internet Applications

As evidenced in the findings, 63.2% of banks adopted Internet applications to develop their services in an efficient manner. These banks pro­vided up-to-date and developed information on the Internet about the diversified services marketed by them. Also, these banks simplified procedures and steps which the client goes through to obtain services via the Internet, and provided new bank­ing services corresponding to the clients’ different needs and desires, expanded and diversified online banking services already offered commensurate with the surrounding environment and respond­ing to various proposals and views submitted by clients about online banking services. Further­more, these banks continuously kept improving their electronic systems and the technology used in delivering online banking services.

Some two thirds of banks adopted Internet applications according to pricing, but this adop­tion was not at the required level. This became clear in the responses of banks with regard to whether they publish their statements of fees and charges relating to the use of their Internet bank­ing services. Banks appeared to co-ordinate their pricing decision with other marketing elements taking into consideration economic conditions and competitor banks’ prices and the cost along with the profit margin in determining the process of their online services.

Twelve out of the nineteen banks (63.2%) adopted Internet applications in distributing their banking services efficiently. The results indicated that these banks drew up a clear plan for distri­bution of their online banking services and took into consideration designing a website adapted to the clients’ different needs, desires and cultures. Moreover, these banks maintained and developed their websites to secure continued service delivery and coverage of targeted markets. Also, the web­sites of these banks contained instructions about the way to obtain services and to pay for them.

Sixteen out of the nineteen banks (84.2%) adopted Internet applications efficiently in pro­moting their banking services. It was found that the banking sector’s adoption of Internet appli­cations in promoting its services was the major adoption among other elements in the marketing mix (84.5%), which reflected the importance of promotional activities on the Internet for banks in marketing their services. This finding is con­sistent with the study of Awamleh et al. (2003), which found that most Jordanian banks present institutional and promotional information in their websites.

These banks drew up a clear plan for promot­ing banking services on the Internet, advertised on the Internet, retained contact and interaction with their clients before and after delivering ser­vices and published information and news about their bank’s services in the form of news items through the Internet. Furthermore, they sought to establish and consolidate relations with their audience through the Internet. However, sales promotion as an element of the promotional mix was not adopted efficiently by banks for promot­ing online banking services. This was clear in the responses of the banks which measured whether the banks provide rewards for promoting online banking services marketed via the Internet.

Impact of the Internet

In order to shed light on the impact of the bank­ing sector’s adoption of the Internet analysis was undertaken on international banking service quality, price, distribution, promotion, and the in­ternational clients’ commitment towards the bank. The banking sector’s adoption of the Internet had an impact on the international banking services quality of 12 out of the 19 banks (63.2%). These impacts become clear in the light of the findings, which indicated that the adoption of the Internet enabled these banks to offer their international clients reliable, accurate, secure, improved and immediate banking services via the Internet to meet their expectations. Furthermore, the acces­sibility and ease to contact international online banking services and ATM networks have also been indicated.

The adoption of the Internet affected service prices for two thirds of the banks. This became clear in the light of the results, which indicated that the adoption of the Internet by these banks contributed to increase price competition and stan­dardisation of prices of online banking services across borders, and reduced prices as a result of international baking competition. Furthermore, attracting market share beyond geographical borders and promoting banks’ competitive ad­vantage through the prices of banking services were delivered via the Internet.

Twelve out of nineteen banks’ (63.2%) adop­tion of the Internet affected their international banking services distribution. This impact became clear in terms of delivering banking services to the largest possible clients beyond geographical borders according to proper time and place and achieving a continuing contact with them on a 24 hour basis. Furthermore, reducing the distribution cost and creating policy changes in distributing banking services in international markets have also been clarified.

Internet applications affected the international banking services promotion of 18 out of 19 banks (94.7%). This result shows that the highest impact of the banking sector’s adoption of the Internet was the impact on promoting its services internation­ally. This impact became clear in the light of the findings, which illustrated the important role of promotional activities on the Internet in informing current or prospective clients in international mar­kets by virtue of the variety of banking services, invoking clients’ interest beyond geographical borders and persuading them to deal with the bank and bolstering ties and relations with them. Furthermore, reducing the promotion costs of banking services through the Internet in interna­tional markets has been demonstrated compared to the traditional promotion methods, creating policy changes in terms of promoting banking in international markets and the remarkable improve­ment in the process of market intelligence at an international level.

The banking sector’s adoption of the Internet affected the international clients’ commitment towards 12 of the 19 banks (63.2%). This impact became clear in terms of meeting international clients’ satisfaction and enhancing their trust in banks. Furthermore, this was consolidated in in­ternational clients’ loyalty to the banks and their frequent use of their Internet banking services. This finding is closely related to the study of Rexha et al. (2003), where it was found that customer satisfaction, trust, and the use of electronic bank­ing were found to have a positive impact on the corporate clients’ commitment towards their bank. Also, this finding is consistent with the survey of ForeSee Results and Forbes.com (2003), in which it was found that customers using online bill payment are more satisfied with their banks than customers not utilising online bill payment. Moreover, online bill payment has a significant direct impact on adoption, loyalty and will also increase the frequency of use of online banking.

Obstacles Facing the Banking Sector's Adoption of the Internet for Marketing its Services Internationally

The major obstacle facing the banking sector’s adoption of the Internet, and for marketing its services internationally and ranked first, was lack of legislation that regulates and controls e-trans­actions (100% of respondent banks). This find­ing is consistent with other studies, for example, the existing legacy system became an inhibitor for the adoption of Internet banking (Bradley & Stewart, 2002). Jordan is still suffering from a lack of basic requirements for implementing the Internet as a result of a deficiency related to the absence of rules for implementation for legal and financial aspects (The Royal Scientific Society, 2003), and legal support is also a major barrier to Internet banking adoption for corporate custom­ers (Rotchanakitumnuai & Speece, 2003). The obstacles that were ranked second (94.7%) were increasing computer crimes, fraud and piracy on the Internet, concerns related to the privacy and security of transactions delivered via the Internet. This finding is consistent with those from other studies, for example, privacy and security con­cerns was a major reason for not currently using online banking (ForeSee Results & Forbes.com, 2003), security concerns affecting the adoption of Internet banking by Australian consumers (Sathye, 1999) and security was the prime issue for those not banking online (Singh, 2004). Also, other obstacles ranked second were lack of an efficient strategy for marketing banking services internationally on the Internet and the low level of clients’ trust in e-transactions. This finding is consistent with those found in other studies, for example, trust in the Internet is one of the most critical issues inhibiting adoption, including wor­ries about security of the system, low reliability of transactions, and distrust in the service provider (Rotchanakitumnuai & Speece, 2003). A major obstacle facing implementation at an international level was the poor rate of trust in the payment process (The Royal Scientific Society, 2003). Obstacles also included poor demand for banking services marketed by the bank via the Internet outside geographical borders, which ranked third (89.5% of respondent banks), followed by lack of safety in e-payments and e-money on the Internet, inability to compete in international markets, and lack of a homogenous mixture of technical expertise, information technology knowledge and marketing skills, which ranked fourth (78.9% of respondent banks). This finding is consistent with the study of Awamleh et al. (2003), which found that non-availability of information technologies, packages, solutions and human resources was one of the major challenges facing further development of Web banking in Jordan.

The null (Ho) and the alternative (Ha) hypoth­eses investigated in this study were:

Hypothesis 1:

Ho: The banking sector’s adoption of Internet applications in Jordan does not affect the international banking services’ quality, prices, distribution and promotion.

Ha: The banking sector’s adoption of Internet ap­plications in Jordan affects the international banking services’ quality, prices, distribution and promotion.

Multiple regression analysis was used to test the hypothesis and it was found that the calculated F value was greater than the tabulated F value. According to the decision rule accept Ho if the calculated value (F) is less than the tabulated value (R) and reject Ho if the calculated value (F) is greater than the tabulated value (R). Since the calculated value (F) was greater than the tabulated value (R) Ho was rejected and Ha was accepted. Thus, the banking sector’s adoption of Internet applications in Jordan affects the marketing of its banking services at an international level in terms of quality, process, distribution and promotion.

Hypothesis 2:

Ho: The banking sector’s adoption of Internet applications in Jordan has no impact on the international clients’ commitment towards the bank.

Ha: The banking sector’s adoption of Internet applications in Jordan has an impact on the international clients’ commitment towards the bank.

Again, multiple regression analysis was used to test the hypothesis and it was found that the calculated F value was greater than the tabulated F value. Thus, the banking sector’s adoption of Internet applications in Jordan has an impact on the international clients’ commitment towards the bank.

CONCLUSION

In the light of the statistical findings there are a number of significant conclusions and recom­mendations. The banking sector’s adoption of Internet applications in Jordan has had an impact on the international clients’ commitment towards the banks. This impact has become clear in terms of meeting international clients’ satisfaction and enhancing their trust in the banks. Furthermore, this has consolidated international clients’ loy­alty to the banks and their frequent usage of their Internet banking services (Sorournejad & Monadjemi, 2011). The influence of the banking sector’s adoption in Jordan of Internet applica­tions on international banking services quality differs according to the different size of banks. Meanwhile, the impact of such adoption on in­ternational banking services’ prices, distribution, promotion, and international clients’ commitment towards the bank does not differ according to the different sizes of banks. The effect of the banking sector’s adoption in Jordan of Internet applications on international banking services’ quality differs according to different banks’ experiences. Mean­while, the impact of such adoption on international banking services’ prices, distribution, promotion, and the international clients’ commitment towards the bank does not differ according to the different banks’ experiences. The bearing of the banking sector’s adoption in Jordan of Internet applications on marketing its services internationally does not differ insofar as banks have branches abroad. It appears that the banking sector in Jordan adopts Internet applications for marketing its banking services in an efficient manner. Banks adopted Internet applications in developing, distributing, and promoting their banking services (Sorournejad & Monadjemi, 2011) efficiently. But in terms of pricing adoption was not to the required level. The major obstacle facing the banking sector’s adoption of the Internet for marketing its services internationally was lack of legislation to regulate and control e-transactions.

Further to the conclusions some approaches are recommended for emerging practices to enhance the process of improving the efficiency of adopt­ing Internet applications for marketing banking services in Jordan locally and internationally. Banks have to continuously improve their online security (Rotchanakitumnuai & Speece, 2003; ForeSee Results & Forbes.com, 2003) in order to increase consumer confidence. Since the Internet is an open network, Internet banking customers appear to be much more concerned with security of their banking transactions and the privacy of their personal information than do traditional banking customers. Therefore, the Internet banks should do their best to ensure security of their customers’ personal information and banking transactions.

Banks should also advertise and publicise their security innovations, as this will play a role in improving consumer confidence in their service. If customers are aware of what is on offer, they will soon want to use it (Akram & Asghar, 2012; Musiime & Ramadhan, 2011).

Banks should implement appropriate public awareness programmes and train their custom­ers to use their online facilities in order to grow their Internet service usage (Casalo et al., 2008). Training can be conducted through the banks’ regional training centres. Institutions and person­nel such as universities and technicians have the infrastructure available, and sessions could be held for bank customers using either the banks’ trainers or lecturers who have been trained as train­ers. Training should not be restricted to current customers. Banks need to educate the potential market. Therefore, banks could try and capture final year students by providing them with free Internet banking training. Banks should pay more attention to sales promotion, the important element in the promotional mix. It was found that 21.1% of banks only provided rewards or lower prices for promoting online banking (Han, 2008) services. Banks could allocate a portion of the savings they enjoy from customers using Internet banking and reward them with incentives. The rewards that could be given to Internet bankers are limited only by the imagination of the banks. Some ideas that could be used include double airline miles, points that could be redeemed for products, entry into a competition that carries a large financial prize, incentives for introducing new online bankers, customers who pay water and electricity bills online could receive a month’s free electricity.

The banks are required to keep increasing the speed of online systems’ responses to custom­ers’ input, upgrading the websites’ navigational functions, and improving the compatibility of their online systems with customers’ application software as well as hardware. It is necessary to take into consideration that these websites do not target solely clients inside Jordan, but are also of a universal nature, and their design should reflect cultural, linguistic and technological differences. There is a need to formulate and implement inte­grated educational and training plans that aim to prepare a qualified technical workforce capable of developing and managing Internet applications to World standards. Prior to engagement in cross­border e-banking (Casalo et al., 2008; Riyadh et al., 2009) activities, a banking institution should conduct an appropriate risk assessment (Alrawash- deh et al., 2011) and due diligence. It needs to establish an effective risk management programme for these activities. International harmonisation of electronic banking regulations must be a top priority. This means intensifying cross-border co­operation between supervisors and co-ordinating laws and regulatory practices internationally and domestically across different regulatory agencies. There is a need to provide insurance for hardware appliances, software, information networks, and employees of information technology depart­ments against damage, error, cheating, robbery and fraud. It is necessary to draw up effective strategies for enhancing e-banks’ works in Jordan and marketing their banking services both locally and internationally on the Internet in order to cope with challenges posed by international competition vis-a-vis the banking industry.

Research Limitations

There are three research limitations to this study of the impact of Internet adoption on the interna­tional marketing of the Jordanian banking sector. First, there is limited consideration of the updating and improvement of laws and legislation related to banking work. Second, computer fraud and crime have not been investigated in depth. Third, the attention paid by banks to the issue related to the supply and demand of Internet banking services (Sorournejad & Monadjemi, 2011) at the time of pricing the services has only received cursory attention.

Future Research Directions

In response to the research limitations future research needs to investigate how to update and improve laws and legislation related to banks’ work in conformity with requirements, developing a legal framework warranting confidentiality of transactions (Hayale & Khadra, 2006) between clients and banks and tackling all issues related to e-business (Alawneh & Hattab, 2009) such as digital signatures, digital identity, tax treatment and consumer protection, etc. Laws for computer fraud and crimes should also be investigated and put in place to protect those using online banking to give them a sense of trust and security. Such law should be harmonised with international law since computer crimes are international in nature. It is necessary for banks to pay greater attention to the issue related to the supply and demand of Internet banking services at the time of pricing these services and to publish their statement of fees and charges relating to the use of their Internet banking services (Sorournejad & Monadjemi, 2011) as an emerging practice.

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ADDiTiONAL READING

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KEY TERMS AND DEFINITIONS

E-Banking: Electronic, Internet, and WWW channels of communication to transact bank business for customers domestically and inter­nationally.

E-Business: Internet used to sell, buy, or exchange services or products.

E-Commerce: Buying and selling goods and services over the Internet.

E-Market Place: An electronic market place that allows buyers and sellers to communicate online.

Information and Communication Technol­ogy (ICT): The use of computer based information systems (ISs) and communication systems (CSs) to process, transmit, and store information and data.

International Marketing: Marketing under­taken by organizations across national boundaries or overseas.

Internet: The worldwide network of networks that use the TCP/IP communications protocol.

This work was previously published in E-Marketing in Developed and Developing Countries, edited by Hatem El-Gohary and Riyad Eid, pages 275-290, copyright 2013 by Business Science Reference (an imprint of IGI Global).