International Journal of Innovative Technology and Exploring Engineering (IJITEE) ISSN: 2278-3075, Volume-8 Issue-6, April 2019 A Study on Customer Satisfaction of Bharat Interface for Money (BHIM) Anjali R, Suresh A Abstract: After demonetization on November 8th, 2016, India saw an increased use of different internet payment systems for Mobile banking saw its growth during the period of 2009- money transfer through various devices. NPCI (National 2010 with improvement in mobile internet services across Payments Corporation India) launched Bharat interface for India. SMS based applications along with mobile Money (BHIM) an application run on UPI (Unified Payment application compatible with smartphones offered improved Interface) in December 2016 to cater the growing online payment banking services to the customers. Apart from the bank’s needs. The different modes of digital payments saw a drastic mobile applications other applications like BHIM, Paytm, change in usage in the last 2 years. Though technological Tez etc. offered provided enhanced features that lead to easy innovations brought in efficiency and security in transactions, access to banking services. In addition to this, The Reserve many are still unwilling to adopt and use it. Earlier studies Bank of India has given approval to 80 Banks to start mobile related to adoption, importance of internet banking and payment systems attributed it to some factors which are linked to security, banking services including applications. Bharat Interface for ease of use and satisfaction level of customers. The purpose of money (BHIM) was launched after demonetization by this study is to unfold some factors which have an influence on National Payments Corporation (NPCI) by Prime Minister the customer satisfaction of BHIM application. The study was Narendra Modi, at Digi Dhan mela at Talkatora Stadium in conducted using data collected from 130 users of (prior and New Delhi on 30th December 2016 [15]. current users) BHIM application. The analysis gives an understanding, that factors which can influence the intensity of II. HISTORY OF INDIAN PAYMENTS customer satisfaction of BHIM application are speed of The Indian Payment system was very different and transaction, perceived ease of use, security and customer service. Though all the factors are related to customer satisfaction, the fascinating from usage of shells to digitalization as means of intensity of relationship is stronger for speed of transaction payment. The many transformations that has undergone in the medium of exchange of Indian currency is shown below Keywords- Internet banking, BHIM, customer satisfaction, [11][17][18].Though demonetization has moved a step to payment systems, fintech. push the economy to adopt to digital payments the love for money is still the same. I.INTRODUCTION It was in 1920’s that e-banking (the use of electronic medium such as telephones, mobiles, internet etc.) for banking services came into being in UK and US with the introduction of telegraphic mode of payments[2][5]. The usage of electronic fund transfers and credit cards was popular in these countries by 1960.The concept of web based mode of banking started in 1980’s [2]. Indian mode of traditional banking namely branch banking got switched to e-banking in 1990’s with ICICI bank being the first mover to launch the internet banking services. Now most of the banks in India offer e-banking services or products which include ATM, mobile banking, tele-banking, electronic clearing services, and smart cards etc. Offering banking services through mobile applications and internet banking is the concept of mobile banking. The proliferation of internet and development of communication and technology has forced banks to compete with each other and introduce mobile banking services in India. Fig 1: History of Indian Payments (Source:Authors compilation) First decade of 18th century saw the beginning of Indian banking industry with the introduction of paper Published By: Retrieval Number: F3493048619/19©BEIESP Blue Eyes Intelligence Engineering 266 & Sciences Publication A Study on Customer Satisfaction of Bharat Interface for Money (BHIM) currency which is more said to be the 1st phase of banking payment was introduced like the Real time gross (1947) with the establishment of General Bank of India (the settlement(RTGS),Electronic clearing service(ETS)National General Bank of Bengal and Bihar (1773-75). The Bank of Electronic fund transfer(NEFT), Immediate Payment Hindustan (1770-1832) were the earliest issuers of paper Service(IMPS), mobile wallets and more importantly currency in India in the year 1786[10]. This has become the introduction of UPI (Unified payment system ) which can important tool which facilitated the financial development of help mobile applications to transfer money from one bank Indian economy. Various other banks were also set up by account to another in seconds. Now even retail payments the East Indian Company (Bank of Bengal (1809), Bank of can be done using these applications and facilities. The Madras (1843), Bank of Bombay (1840) which was called effect of demonetization, increased the online transactions the Presidency Banks and these were amalgamated into by 250% compared to the previous other years [2]. Imperial Bank that came into its existence in the year 1920. Now many of the major banks started launching it's on This was further renamed as State Bank of India after private application for easy transaction like sbi pay, canara independence and Reserve bank of India came into being in bank app, HDFC bank mobile app etc. Many of the small 1935 [10][2][16]. finance banks like ESAF started to grow and they also The central authority or powers to supervise the entire started with their own payment apps as a part of financial banking in India was later given to the Reserve Bank of inclusion. Apart from this the key players in the telecom India. There were several changes or steps taken in the industry were also issued licenses to launch payments bank banking sector after independence. This started all with the like airtel payment bank and jio. India Post has also started Nationalization of Imperial bank to SBI with powers or with digital mode of transaction using DOP, mobile money banking facilities i.e. it was given the power to act as the transfer which enables instant money transfer from one to principal agent of RBI and to deal with the banking in union another using mobile through India post and also launched and state governments. Several other banks were also India Post Payment banks. Today in terms of supply and nationalized in 1960 (14 major commercial banks were product range banking in India is generally fair mature. For nationalized).The second phase of banking (1947-1991) all private sector and foreign banks the reach to rural areas still started with nationalizing 7 more banks in1980 [10][16].In seems to be a major challenge. the 3rd phase of Indian banking, the country was inundated Mobile and wireless market is the fastest growing over the with foreign banks, ATM’s (introduction of plastic money) past few years. Mobile banking is adopted in many parts of and it was the time when services like phone banking and the world. An exception to this can be remote or rural areas net banking was introduced. Banking started to be quick and where there is no or little infrastructure. Concern about the more easy than normal. Time, convenience and accessibility time and expense decreased when banks availed the services started to draw attention and became more important than of mobile payment applications. The retail transactions like the money itself .Digitalization took its role with the mobile recharges, bill payments, money transfers and replacement of paper based cheque clearing system with the purchases on e-commerce was made simple, quick and easy cheque transaction system (CTS). with the launch of mobile payment applications. At present, Later various forms of digital mode of payment was we have a number of mobile payment applications including introduced like the Real Time Gross Settlement (RTGS), payment banks. Paytm is the most used payment application Electronic clearing service(ETS), National Electronic Fund other application include Freecharge, Mobikwik, State Bank Transfer (NEFT), Immediate Payment Service(IMPS), Buddy, LIME by Axis bank, ICICI pockets, Vito Master mobile wallets and more importantly introduction of Pass, Citrus, Momoe etc. Bharat Interface for money UPI(Unified payment system )which help mobile (BHIM) is one such bank to bank instant payment applications to transfer money from one bank account to application launched after demonetization by National another in seconds. Now even retail payments can be done Payments Corporation (NPCI) by Prime Minister Narendra using these applications and facilities. The effect of Modi, at Digi Dhan mela at Talkatora Stadium in New Delhi demonetization, increased the online transactions by 250% on 30th December 2016 [15]. compared to the previous other years. [2] Today in terms of supply and product range banking in India III.BHIM is generally fair mature. For private sector and foreign banks Bharat Interface for Money (BHIM) is a mobile application the reach to rural areas still seems to be a major challenge. which can be used by a person who holds a bank account. It The Reserve Bank of India is an autonomous body with allows the user to make bank to bank money transactions as minimum pressure from government well as merchant transaction if the merchant application is India, today has 88 schedule commercial banks – 29 private registered on BHIM interface in an easy, simple and quick sector, 31 foreign banks and 28 public sector bank. Bank of manner using Unified Payments Interface (UPI). This is Baroda, State Bank of India, Canara Bank Punjab National done using the mobile number / Virtual Payment Address Bank, HDFC Bank, ICICI Bank, Kotak Mahindra Bank, (UPI ID).