The twenty-first century is characterised by the use of information technology

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1.0 Background to the study (Problem Statement)

The twenty-first century is characterised by the use of information technology and the internet which has revolutionised our working and living patterns. Banks are among the

most intense users of technology by offering financial products and services over the internet. They developed internet applications for carrying out a diversity of financial transactions which replaced the traditional forms of banking procedure —for example, in

opting for an online account, customers can set up, amend and cancel standing orders and make one-off payments at a time and location suitable to them.

Many banks in the developed courtiers have identified online banking as a tool to increase both retain their existing customers and increase their market share. Online banking services are now offered by most of the Saudi banks and the major services offered include transfer funds between client's own accounts, to another client of the bank, and to other banks locally and aboard; view and print account balances and summaries. Due to the limited research available on Online banking in Saudi Arabia,

Information about the factors that have influenced users' behaviour to adopt or use online banking in Saudi Arabia is required. In fact, online banking has not been critically examined in Saudi Arabia in which the researcher believes that there is a need to understand users' acceptance of internet banking as well as the relevant factors that affect customers' attitude towards adopting online banking activities. Hence, the finding of this study will help commercial banks in Saudi Arabia in developing strategic plans to promote products and services and to design easy, useful and trustworthy systems over the internet in future. Generally speaking, it is important to conduct this research that seeks to explore consumer views about how commercial banks in Saudi Arabia can design easy, useful and trustworthy systems, particularly given the fact that Saudis could switch to new entrants offering better E-banking services and facilities.

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1.1 Aim and objectives of the Research

The aim of this study is to identify the factors that discourage customers to adopt online banking in Saudi Arabia and to develop strategies in order to eliminate barriers to the use of online banking and to maximise the rate of adoption. In order to fulfil the overall aim of this research, the following objectives will need to be addressed: To explore the Saudi Arabian financial sector structure and the Saudi commercial

• To review the literature that suggests the use of technology acceptance models and theories in information technology acceptance/adoption to understand customers' behaviour towards technology.

• To determine factors that influence customers' acceptance and use of online banking from previous research and validate the relationship between these factors that drive the adoption and acceptance of such a service.

• To present recommendations for commercial banks and government in order to develop better online banking systems.

1.2. Significance of the research

1.3 Limitation of the research

1.4 Research Questions

To examine the factors that affect customers' attitude towards online banking acceptance at the Saudi Arabian banking sector, the following research questions will be raised:

I. What are the factors that influence the customers' tendency to use online banking as a primary banking Channel?

2. What is the role of culture, trust, social influence, security and demographic characteristic in the acceptance of technology and in affecting customers' attitude towards online banking?

3. How can findings from this study be used to advance the Saudi Arabian financialinstitutions and other gulf and Middle East countries in similar context?

4. How can the findings from this study in Saudi Arabia be replicated to enhance the acceptance of ecommerce and IT applications in general and online banking in particular in developing, gulf and Middle East countries?

IS Research hypothesis

Figure 1 shows the research model and, the study put forward the following hypothesis:

o H 1: There is a positive relationship between Quality of Internet connection and the perceived usefulness (PU) of the online banking systems.

H 2: There is a positive relationship between consumer awareness and benefits of online banking services and the perceived usefulness (PU) of the online banking systems.

Independent Variables

• Quality of Intemet HI connection

• Awareness benefits

Dependent Variable

Perceived usefulness (PU) and of online banking services

Figure 1: Research model

1.4 Limitation of the research

This study examines the factors affecting customers' attitude towards online banking acceptance in the Saudi Arabia. The city of Jeddah in Mekka province (figurel) was chosen because it has a very rich cultural heritage characterized by various immigrant populations- which compares rather differently to other more culturally homogenous