The Use of Internet and Mobile Banking in the Czech Republic

. Internet and mobile banking is becoming more important worldwide. New technologies have huge impact for the introduction of new functionalities in both internet and mobile banking. Growth of Internet users and smartphones also has an impact on this growth. The Czech Republic was using internet banking above the European Union average in 2017. In the European Union 51% of individuals used internet banking and 57% of individuals in the Czech Republic. The main aim of the article is to analyze the situation in the use of internet banking in the Czech Republic by the number and percentage of individuals and by age, gender and education. The second part of the article is focused on the analysis of ten banks with the largest number of clients in the Czech Republic, where they analyze the latest and most needed features of their mobile banking from the client perspective. The last part focuses on the use of social networks by banks. The article uses primary and secondary data.


Introduction and current situation
With the sky rocking number of smartphone users and popularizing of internet worldwide, there with the phenomenal growth of e-banking transactions through mobile phones. According to a recent forecast (Internet world, 2015) [1]. Mobile and Internet Banking has a great contribute in online banking revolution, which is giving a competitive edge to the banks against their rivals. Especially "Transaction Alert / Confirmation" is most demanding service by users. Customers feel that after monetary transaction the SMS should be received, and they prefer the version of the IVR (Interactive Voice Response) banking service that provides (outof-band) SMS confirmation over those one that does not [2]. Therefore, online banking helps banks to retain and enhance the loyalty of their existing customers, increase customer satisfaction, provide opportunity to the banks to increase market share, reduce administrative and operational cost and to improve banks' competitive positions against their rivals [3][4][5].
The popularity of Internet banking is growing worldwide. Internet banking is the only activity that students use to a lesser extent than the average population (of the monitored population).

2
The literature review The market for banking services in the Czech Republic is characterised by high competition. The market was recently joined by four new 'low-cost' banks which opted for an offensive pricing strategy to enforce themselves. [6] One of the ways to keep the number of clients for existing banks is Internet and Mobile banking. The Promotion of online banking technology enabled the banks to enhance its operations with cost cutting effectively and efficiently in order to handle daily banking affairs via online banking channel. Customers are being facilitated by reducing their visits in banks and they can carryout their transactions via internet or ATM Machines instead of personally visiting the branches. [5].
With the growth of using e-banking transactions through mobile phones in China, it brings along with convenience of people's life as it enables people to have access to banking services anywhere and at any time as well as it conducts business more effectively. [7].
When the consumer has a market overview then the optimal product can be chosen more or less easily. Soukal and Draessler [8] model more realistic situation where the consumer does not have a market overview and so the process of search has to be performed. The harder the search is the higher information asymmetry is. Currently, clients decide how according to the charges for current account and primarily by the level of Internet and Mobile Banking. Customers are particularly interested in the features to help control and manage their accounts.
In the last decade, Internet banking technology has made remarkable progress. However, there is a huge disparity across different nations all over the world in the diffusion of Internet banking services. This leads to the research question of Takieddine and Sun [9] study: why different countries exhibit different levels of Internet banking adoption? We will focus on the situation of Internet Banking in the Czech Republic. Regarding technological readiness the Czech Republic is doing better than the other Visegrad countries. Citizens are technological equipped and they have competencies to use ebanking. [10] Černohorská et al. [11] examine the comparative performance of Banks for the Visegrad group (V4) of four Central European States for the period 20092013.Their results showed that average technical efficiency (for all banks) trended upward during the study period. This increase efficiency is not common for all banks in the Czech Republic, Poland, Hungary and Slovak. They found that efficiency for Czech, Polish and Slovak banks increase during research time. Development of efficiency Hungarian banks has on the contrary a downward trend from 0.882 in 2009 to 0.856 in 2013. We also founded that the Total Factor of Productivity (TFP) changes across all countries was relatively stable in 3 of the 4 observation periods.
Smaller firms, however, invested more in research and development (R&D) and Vokoun [12] was found no linear relationship for output characteristics.

The goal of article and methodology
The article is based on primary and secondary sources. Secondary sources comprise information about Internet Banking in the Czech Republic and European Union, professional literature, information collected from professional press, discussions or previous participations in professional seminars and conferences relating to the chosen subject. Primary resources are based on information obtained from the web portals of individual banks in the Czech Republic. Then it was necessary to select, classify and up-date accessible relevant information from the numerous published materials that would provide the basic knowledge of the selected topic. [13]. The goal of the article is to focus on the Internet Banking in the Czech Republic and its position within the European Union. The second part of the article analyzes new features in mobile applications at the top ten banks according to the number of clients in the Czech Republic. The last part focuses on the use of social networks by banks. The article uses primary and secondary data.

Internet banking in European Union
By 2017, the share of EU-28 households with internet access had risen to 87 %, some 32 percentage points higher than in 2007. Broadband internet access was used by 85 % of the households in the EU-28 in 2017, approximately double the share recorded in 2007 (42 %). [14]. Figure 1 shows that on average 51 % individuals aged 16-74 used Internet banking in in European Union in 2017. This share is constantly increasing and has doubled since 2007, when it stood at 25%.
Internet banking is particularly popular among 25 to 34 year olds, with 68% using this facility. The use of internet banking tends to increase in line with the education level of the user. While only 24% of those with low education use e-banking, 77% of those with high education use this service.
Among EU Member States, internet banking is most common in Denmark (where 90% of people aged 16 to 74 said they were using it) and the Netherlands (89%), followed by the other Nordic countries -Finland (87%) and Sweden (86%).
Internet Banking is second less popular among the youngest ones. Only 44 % of younger internet users performed some kind of electronic transactions with a bank (for payment, transfers, etc. or for looking up account information) against 55 % aged 5574 and 65 % aged 25-54 in 2016. [16].  Figure 1 shows that the Czech Republic is above the EU average and 57% of individuals used Internet banking in 2017.

5
The results of the Internet Banking in the Czech Republic In a deeper analysis and use of statistical functions, it was subsequently found that Internet Banking has increasing trend. The logarithmic trend explains 93 % of the variance. The linear trend explains over 95% of the variance.

Internet Banking in the Czech Republic
Overall, Internet Banking uses 52% of individuals in 2017. Of this, 55% of males and 49% of women use the internet banking in the Czech Republic (see Figure 3). Males Females 66 % of individuals using the Internet in 2017 and 52 % of individuals using Internet Banking in the Czech Republic. Interestingly, in the 16-24 age group, all who use the Internet are also using Internet banking. This trend, with a slight decrease, can be observed for the age groups of 25-54 years. Since the age of 55, there has been a steep decline in the use of Internet Banking. Only 12% of individuals from age 65+ use Internet Banking. The Internet uses 36% (see Figure 4).

Use of social networks by banks
The biggest commercial banks were selected into comparison. All of ten most important banks use Facebook, Instagram, Twitter, Linkedin and YouTube. Half of them do not use account on the Google+. Account on Google+ have Air bank, Equa bank, Česká spořitelna, Fio bank and Komerční banka (see Table 2).