New Delhi, Jul 3 (IANS): While the government has been pushing people to go online when it comes to banking, the branch still continues to dominate banking channels in India, with 94 per cent of retail banking customers having visited the branch/store at least once in the past 12 months, a new study revealed on Monday.

According to the 2017 Oracle J.D. Power India 'Retail Banking Study,' despite the impetus provided by demonetisation, digital banking is not yet a pervasive experience in India.

"Most banking relationships still begin and continue at the branch. However, there is great potential for banks to move more into the digital space. Only 51 per cent of retail banking customers have a reliable online banking experience with their main financial institution," said Gordon Shields, senior director, J.D. Power, a US-based global marketing information services firm.

The results was based on in-person interviews with 5,368 retail banking customers conducted between February and April 2017 across 14 states and included both private and public banks.

"In fact, overall customer satisfaction with banking in India is lagging significantly behind other key markets at 672 index points, compared to the industry average score reported in other J.D. Power studies in China (806), the USA (793) and Australia (748)," Shields added.

The study measured overall satisfaction in five factors: account activities (39 per cent); account information (18 per cent); facility (17 per cent); product offerings (14 per cent) and fees (12 per cent).

While overall customer satisfaction with mobile banking is markedly higher (693) than with In-Person Branch interaction (676), only 9 per cent of India retail banking customers use mobile banking for everyday transactions.

"Among the 48 per cent of customers who have yet to download a banking app, one-fourth state lack of security is a key reason for non-usage," Shields noted.

Nearly three-fourths (73 per cent) of customers believe their financial needs were not fully understood before they were offered new products, with only 7 per cent having had fees and pricing of products explained.

"As India embarks on its digitisation agenda, results on ground exhibit a contrary reality," said Kiran Kumar Kesavarapu, APAC leader, industry innovation advisors-financial services Oracle.

"We believe the issue lies in customer engagement models that Indian banks employ today and related security uncertainties when transacting online. This can be addressed easily and quickly," Kesavarapu added.

Private banks outperformed public banks and were rated higher in overall satisfaction (680) than public banks (666).

Private banking customers are more likely to recommend their bank to friends and relatives (89 per cent) than public banks (86 per cent).