E-banking services and bank performance: perspective from India

Internet technology is being embraced by financial institutions to enhance the reach of their product and services using electronic platforms. Although there is a rapid shift in adopting e-banking services, what impact does it have on the bank's performance? This paper examines these questions in the context of Indian banks. Using an unbalanced panel data of 20 Indian banks over the period 2010 to 2019, this study examines the impact of e-banking services on the performance of Indian banks measured in terms of return on assets, return on equity, and net interest margin. There has been a consistent expansion of e-banking activities over the last decade, but the findings of the study report mixed results on its impact. Possible reasons for these outcomes could be that India is a developing country; the cost of implementing these e-service platforms is high; clients' perspective is quite traditional, and there is a lack of banking infrastructure. However, consumers' perspective is slowly changing, and users of e-banking services are gaining pace.