Impact of Digital Banking Services on Customer Satisfaction: A Study of Banks in Jamshedpur

Abstract

The rapid expansion of digital banking services has significantly transformed the banking sector by improving the delivery of financial services through mobile banking, internet banking, ATMs, and UPI-based platforms. The present study examines the impact of digital banking services on customer satisfaction among bank customers in Jamshedpur. A descriptive and quantitative research design was adopted, and primary data were collected from 390 respondents using a structured questionnaire. The data were analyzed using SmartPLS 4, and the hypothesis was tested through structural equation modeling with bootstrapping. The results reveal that digital banking services have a significant positive impact on customer satisfaction (? = 0.499, t = 10.943, p < 0.001). The findings indicate that improvements in convenience, accessibility, security, and efficiency of digital banking services lead to higher customer satisfaction. The study concludes that effective digital banking services play a crucial role in enhancing customer experience and fostering long-term customer satisfaction in the banking sector of Jamshedpur.

Introduction

The text discusses the impact of digital banking services on customer satisfaction among bank customers in Jamshedpur. The growth of information and communication technology has transformed banking through services such as mobile banking, internet banking, ATMs, and digital payment platforms. These services improve convenience, accessibility, speed, and flexibility for customers. However, factors such as security, reliability, trust, and service quality strongly influence customer acceptance and satisfaction.

The study highlights that traditional banking is being replaced by digital solutions, making it important to evaluate whether digital banking services effectively improve customer experiences. Previous research shows that perceived usefulness, ease of use, convenience, security, and electronic service quality positively affect customer satisfaction and loyalty.

Problem Statement:

Although banks are rapidly adopting digital technologies, customer satisfaction remains a concern. Issues such as transaction reliability, security, ease of use, and accessibility influence users’ perceptions. Limited research exists on the effect of digital banking services on customers in Jamshedpur, creating a need to examine this relationship.

Objectives:

1. Analyze customer demographics and digital banking usage patterns in Jamshedpur.
2. Examine the impact of digital banking services on customer satisfaction.

Research Methodology:

• Research design: Descriptive and quantitative research
• Data source: Primary and secondary data
• Sample size: 390 bank customers
• Location: Jamshedpur, Jharkhand
• Sampling method: Convenience sampling
• Measurement: Five-point Likert scale
• Analysis tool: SmartPLS 4 using PLS-SEM

Key Findings:

• Most respondents were male (56.41%) and belonged to the 25–35 age group (39.74%).
• Graduates formed the largest educational group (42.31%).
• Mobile banking apps were the most commonly used digital banking service (37.18%), followed by UPI payments (32.05%).
• Nearly half of respondents (47.44%) used digital banking services daily.

The measurement model showed acceptable reliability, as all indicator loadings exceeded the required threshold of 0.50.

The structural model results showed that:

• Digital Banking Services → Customer Satisfaction
• Path coefficient (β) = 0.499
• t-value = 10.943
• p-value = 0.000

This confirms that digital banking services have a significant positive impact on customer satisfaction. Therefore, the null hypothesis was rejected and the alternative hypothesis was accepted.

Suggestions:

Banks should:

• Improve mobile banking, internet banking, UPI, and ATM services.
• Enhance transaction speed, reliability, and ease of use.
• Strengthen cybersecurity through encryption, two-factor authentication, and fraud monitoring.
• Provide 24/7 customer support through helplines and chatbots.
• Conduct digital literacy programs for customers.
• Collect customer feedback to continuously improve digital services.

Conclusion

The study concludes that digital banking services have a significant positive impact on customer satisfaction among bank customers in Jamshedpur. The empirical results clearly indicate that improvements in digital banking facilities such as convenience, accessibility, security, and efficiency lead to higher levels of customer satisfaction. This finding is consistent with previous studies that highlight the importance of service quality in electronic banking environments. It can therefore be inferred that customers increasingly prefer digital banking channels due to their ease of use, speed, and flexibility compared to traditional banking methods. Overall, digital transformation in the banking sector has become essential for enhancing customer experience and maintaining competitiveness. Banks that continuously invest in secure, innovative, and user-friendly digital banking systems are more likely to achieve higher customer satisfaction and long-term customer loyalty.

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Copyright

Copyright © 2026 Dr. Sayak Gupta , Dr. Puja Prasad , Dr. Rakesh Kumar . This is an open access article distributed under the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.