Banking Sector in Jordan: a Structural Equation Modeling Application

With the development and growth of internet, its applications of e-banking, e-commerce, and e-business became irreplaceable channels regarding its fast access, rich content, and smooth interactivity. High investments are paid toward improving the quality of service offered by the banks. This paper is dedicated to empirically investigating the drivers of e-Business value creation in the Jordanian banking sector. This work summarizes the main differences among employees of Jordanian and foreign bank regarding their perspectives. Many of the competing foreign banks to the Jordanian banks are enforced with huge financial capital, having long periods of banking practices and are employing cutting-edge technologies and tools. To minimize the technological gap, Jordanian banks are working hard to develop their e-Business services. This in one hand has to enhance their trust, satisfaction, and commitment toward existing customers and entice new comers on other hand. Based on business model of Amit and Zott, i.e. the four constructs of eValue framework (efficiency, complementarities, lock-in, and novelty), four hypotheses have been formulated to test the differences in the drivers of e-Business value creation between Jordanian and foreign banks. A survey questionnaire in a form of paper-and-pencil was delivered personally to 200 employees from four main Jordanian banks and 200 employees from four foreign banks working in Jordan. The questionnaire was formed and constructed to test the proposed hypotheses. the findings in this study based on the SEM and T-test analyses, revealed important implications that will help banks’ managers to make well-informed decisions and policies regarding investments and resources allocation for implementing eBusiness strategies and ventures. The paper concludes with discussing the importance of these findings for practitioners and for future research on value accrued from e-Business services.