Thực hành Green Banking và sự hài lòng của khách hàng

Green banking practices and customer satisfaction-way to

green sustainability

Ajaz Akbar Mir

, Aijaz Ahmad Bhat

, Ahmad Samed Al-Adwan

, Summaira Farooq

Dima Jamali

, Irshad Ahmad Malik

Department of Management Studies, University of Kashmir, J&K, India

Department of Business Technology, Business School, Al-Ahliyya Amman University, Jordan

Hourani Center for Applied Scientiﬁc Research, Al-Ahliyya Amman University, Jordan

Dima Jamali, VP University Advancement, Canadian University Dubai, United Arab Emirates

ARTICLE INFO

Keywords:

Green banking

Green ﬁnance

Green infrastructure

Green services

Digital banking

Climate ﬁnance

Customer satisfaction

ABSTRACT

The global environmental concerns have driven sustainable practices in several industries, including banking.

Therefore, this paper is an endeavour to examine the relationship between green banking and customer satis-

faction. The study identiﬁed four pivotal variables and examined how digital banking, green infrastructure, green

loans and services affect consumer satisfaction in select public and private sector banks. The study used cluster

sampling technique and sample was taken systematically from each cluster selected using a comprehensive

research framework. The data show that digital banking, green services, and green loans positively and signiﬁ-

cantly affect customer satisfaction, while green infrastructure does not. The study found that privacy does not

mediate green infrastructure and green loan relationships with consumer satisfaction. The study’s results have

signiﬁcant ramiﬁcations for both the banking sector and government, underscoring the crucial role of green

banking in enhancing consumer happiness. As environmental consciousness continues to increase, this might

potentially result in heightened customer satisfaction and eventually contribute to improved customer retention

for banks. The present study also endorses India’s digital agenda by promoting digital and sustainable banking

practices.

1. Introduction

The economic sustainability of a society depends on adopting envi-

ronmentally friendly practices, products, and procedures. The concept of

sustainable management encompasses the principles of promoting envi-

ronmental sustainability and offering services that are eco-friendly (Garg

&Sharma, 2017). Green management is a dynamic concept in which

ﬁrms actively monitor and mitigate the environmental effects of their

projects and activities (Loknath &Azeem, 2017;Ghosh, Ghosh, &

Chowdhury, 2018). Every economy aims to achieve economic growth

and progress often at the expense of environmental damage. However,

the relationship between economic progress and development does not

ensure sustainability. Sustainable development needs economies to

demonstrate environmental ﬂexibility while also achieving economic

growth. The advancement and expansion of industrialized economies

have a detrimental effect on the condition of the environment and hence

environmental contamination is a worldwide issue (AlGore, 2007). A

banking institution is essential in providing ﬁnancial assistance to the

corporate sector. Banks themselves do not directly inﬂict damage on the

environment, but they do provide ﬁnancial support for initiatives that

subsequently have adverse impacts on the environment (Khan &Fasih,

2014;Meena, 2013). In order to ensure long-term viability, the banking

sector has begun integrating environmentally friendly practices into their

services and implementing measures that yield environmental beneﬁts.

Shantha (2019) and Khan et al. (2020) have identiﬁed two techniques

that banks use to provide sustainable services. The ﬁrst approach in-

volves making bank branches environmentally friendly by adopting

energy-efﬁcient technologies and utilizing eco-friendly energy sources.

The notion of green banking centers around four fundamental elements

economy, environment, society and welfare which is observed in both

This article is part of a special issue entitled: Low-Carbon Economy published in Innovation and Green Development.

* Corresponding author.

E-mail address: caabhat@gmail.com (A.A. Bhat).

Note: denotes equal contribution by Ajaz Akbar Mir and Aijaz Ahmad Bhat.

Contents lists available at ScienceDirect

Innovation and Green Development

journal homepage: www.journals.elsevier.com/innovation-and-green-development

https://doi.org/10.1016/j.igd.2025.100221

Received 31 December 2023; Received in revised form 3 November 2024; Accepted 1 January 2025

Available online 28 February 2025

ND license (http://creativecommons.org/licenses/by-nc-nd/4.0/).

Innovation and Green Development 4 (2025) 100221

established and developing economies (Maulani, 2015). Green banking,

sometimes referred to as G-banking, contributes to eco-friendly sustain-

ability by efﬁciently reducing carbon dioxide emissions (Ikram et al.,

2019;Rehman et al., 2021).

The notion of “G-banking”emerges as a strategic aproach to tackle

climate change and preserve the environment via environmentally

responsible investments in products and services (Lindenberg &Volz,

2016;Sarma and Roy, 2021). The prior research has predominantly

concentrated on the factors, difﬁculties, and advantages of adopting

G-banking, resulting in a signiﬁcant knowledge vacuum about different

dimensions of GBP (Zhang &Yang, 2016). It is essential to address this

gap in order to fully comprehend the consequences and success of

G-banking programs in promoting environmental sustainability. Green

banking is a strategy approach where banks include environmental fac-

tors into their operations, both internally and externally (Sharma &

Choubey, 2022). The environmental impact of banks often stems from

lending activities, where borrowers' actions inﬂuence the environment.

Green banking seeks to incorporate environmental factors into lending

decisions, promoting economic development while also working towards

environmental sustainability and minimizing banks' vulnerability to

environmental risks (Sahoo &Nayak, 2007). It is essential to acknowl-

edge environmental concerns, as they play a vital role in maintaining the

stability of the banking system and managing the ﬁnancial risks related

with climate change (Park &Kim, 2020).

The growing understanding of the complex problems caused by

environmental deprivation has led to a tougher concentration on

reducing the negative effects of human activities, especially in the busi-

ness sector. In 2019, there was a signiﬁcant change when business

leaders, who are part of the Business Roundtable, reinterpreted the re-

sponsibilities of corporations. They started focusing on the interests of all

stakeholders and giving more importance to environmental protection,

rather than just prioritizing the aims of shareholders (Harrison et al.,

2020). The banking sector has become increasingly important in dis-

cussions about the environment, since it aligns with global initiatives

such as the Paris Agreement and makes major contributions to achieving

the aims of the Sustainable Development Goals (Chen, Siddik, Zheng,

Masukujjaman, &Bekhzod, 2022a, 2022b,2022b).

The customers have signiﬁcant role in the operations of commercial

enterprises Rahaman et al. (2022) and hence to satisfy customers is

critical aspect of the organizations particularly in modern Banking and

ﬁnancial services industry. The banking organizations face a hard prob-

lem in retaining consumers (Ayinaddis et al., 2023). Green banking ac-

tivities are in line with the growing trend towards sustainability and have

the potential to improve customer satisfaction and loyalty (Ettinger et al.,

2021). Banks cannot afford to lose consumers, thus maintaining

continual communication with them is in their best interests (Ho &

Chow, 2023). Therefore, satisfying customers is important to retain them

in the organisation. The customer satisfaction has been widely recog-

nized by the ﬁnancial industry, as it plays a key role in establishing

long-lasting, mutually beneﬁcial, and sustainable relationships with

customers (Ravald &Gronroos, 1996). Every organization aims to

establish the kind of rapport with customers that will motivate them to

purchase its goods over an extended length of time (Raza et al., 2020). In

fact, a lack of customer satisfaction has been found to be a signiﬁcant

factor in clients choosing to switch to other Banking institutions (Manari

&Manari, 2007a,2007b). The pursuit of customer satisfaction has

become a crucial principle in the highly competitive contemporary

Banking industry, which is vital for retaining customers (Rust &Zahoric,

1993). However, the Banking landscape has evolved with the increasing

importance of environmental sustainability and ethical Banking princi-

ples. This has resulted in the emergence of green Banking, which goes

beyond technology-focused approaches to encompass the efforts made by

Banks to safeguard the environment and participate in green ﬁnance

activities, as well as compliance with environmental regulations.

Signiﬁcantly, these initiatives are driven by the convergence of envi-

ronmental concerns and social obligations and have a signiﬁcant impact

on customer satisfaction levels (Fernando &Fernando, 2016;Singh,

2015a,2015b).

The relationship between customer satisfaction and green Banking is

crucial, as ﬁnancial institutions have invested heavily in various sus-

tainable Banking activities. The success and ﬁnancial feasibility of these

initiatives depend on various factors, including customer preferences,

awareness, willingness to adopt, and satisfaction with the environmen-

tally friendly products and services provided. The concept of green

consumer happiness is a signiﬁcant topic in this domain (Campiglio,

2016). Green Customer Satisfaction refers to the level of satisfaction a

customer achieves from consuming products and services that meet or

exceed their green requirements, comply with environmental regula-

tions, or align with societal expectations of sustainability. Environmental

themes have been integrated into the design, packaging, and features of

products and services due to the inﬂuence of customer environmentalism

and the impact of environmental regulations. This trend has been

observed in both ﬁrms and Banks. The main objective of this approach is

to meet environmental requirements and fulﬁll customer expectations

(Chang &Fong, 2010). The comprehension and effective management of

consumer expectations have signiﬁcant importance for Banking

institutions.

In contemporary times, there is a prevailing expectation among

consumers for the availability of cashless payment options and round-

the-clock accessibility to electronic Banking services. Green Banking

emerges as a viable solution to meet these demands by providing services

such as electronic cards, online Banking, and automated teller machines

(ATMs). Furthermore, in the continuous endeavour to combat global

warming, consumers value energy-conservation endeavours. The admi-

ration motivates Banks to embrace energy-efﬁcient technology, envi-

ronmentally friendly infrastructure, and sustainable construction

practises. Banks can boost their reputation as environmentally consci-

entious organizations and lower their carbon footprint by achieving these

requirements through customer awareness (Malliga &Revathi, 2016).

Customer satisfaction is the driving force behind customer loyalty, which

is the act of repeatedly purchasing items or services from a certain

organisation, leading to enduring ties with the ﬁrm (Herath &Herath,

2019). Green customer loyalty in the context of green banking refers to

the tendency of consumers to maintain a relationship with ﬁnancial in-

stitutions that prioritise environmental concerns. This involves not only

meeting customers' expectations for ﬁnancial services but also providing

them with opportunities to actively participate in Banking products and

services that mitigate their environmental footprint.

This research provides a substantial addition to the existing body of

knowledge on GBP and customer satisfaction in the Indian setting via

many important means. The text presents a new approach to evaluate the

widespread adoption of environmentally friendly practices in speciﬁc

public and private sector banks. It offers useful insights into the current

status of eco-friendly activities in the Indian banking industry. Secondly,

by measuring the impact of GBP on customer satisfaction, the study

underscores the potential for enhanced customer contentment to moti-

vate banks towards furthering their commitment to environmentally

sustainable Banking practices. The examination of the relationship be-

tween digital Banking, green infrastructure, green loans, green services,

and customer satisfaction adds a crucial dimension to the literature on

the Indian green Banking sector, shedding light on contemporary issues

faced by Banking customers, particularly concerning online Banking

privacy. Lastly, the ﬁndings revealing the signiﬁcant impact of green

Banking on the relationship between customer satisfaction and digital

Banking, green loans, and green services, with privacy acting as a

mediating variable, contribute valuable insights and expand the existing

knowledge base in the ﬁeld of green Banking. This study provides a

detailed and thorough viewpoint on GBP and their impact on customer

satisfaction in the Indian banking industry.

The subsequent part of this work progresses with Section 2, which

presents the literature review. Section 3provides an analysis of the study

data and outlines the methodologies used. Section 4provides an

A.A. Mir et al. Innovation and Green Development 4 (2025) 100221

explanation of the observed data. Section 5is designated for the dis-

cussion, while section 6is designated for the conclusion and

implications.

2. Literature review

The implementation of substantial green banking programs in India

has been noticeably deﬁcient although the immense potential it provides

for promoting sustainable development (Sahoo &Nayak, 2007). Indian

banks frequently avoid thoroughly examining the possible environ-

mental consequences of the cash they provide, as they are afraid that

such investigations could discourage potential borrowers from request-

ing ﬁnancial aid (Choubey &Sharma, 2021). The research undertaken by

Durrani et al. (2020) highlights the signiﬁcant recognition by central

banks in the Asia-Paciﬁc region, namely India, of their pivotal role in

promoting green ﬁnancing. Indian banks are inclined to embrace green

banking techniques owing to many factors. Nevertheless, they face sub-

stantial challenges, including the risk of losing customers to rivals and the

absence of regulations established by the Reserve Bank of India. The

research undertaken by Sarma &Roy (2021) used several approaches to

examine the perspectives of different stakeholders in green banking, with

a particular focus on consumers. The impact of stakeholders, including

societal pressures and media dynamics, has been essential in deﬁning

banks' reactions to environmental hazards (Bose et al., 2018). Customers,

being important stakeholders, have been the focus of much research

regarding their views and behaviours towards environmentally-friendly

banking procedures. Burhanudin et al. (2021) examined how cus-

tomers' behaviour towards green banking services is affected by negative

messaging and concerns about banks indirectly subsidizing environ-

mentally harmful activities. They found that these factors have an impact

on the adoption of green banking services. Ellahi et al. (2021) empha-

sized the signiﬁcance of customers' consciousness and eagerness to

participate in environmentally friendly banking operations, with

educational attainment emerging as a determining factor. Pillai and Raj

(2019) discovered a widespread lack of knowledge among clients

regarding green banking, with many considering it as a mere marketing

tactic rather than a sincere dedication to sustainability goals. Rai et al.

(2019) investigated the way in which bank clients in Nepal perceive

green banking activities. The survey identiﬁed a signiﬁcant lack of con-

sumer knowledge, even though certain institutions had established these

regulations. The study by Bryson et al. (2016) revealed that Indian clients

were driven by environmental factors, resulting in a positive attitude

and, to some extent, a willingness to pay more for banking services that

are environmentally friendly. Nevertheless, they underscored the ne-

cessity for additional study to substantiate these ﬁndings over a wider

range of circumstances within the Indian context.

The literature study examines the existing shortcomings and pro-

spective avenues for further research in the fast-evolving domain of green

banking, speciﬁcally on customer views and behaviour (Burhanudin

et al., 2021;Sarma and Roy, 2021). Evaluating the correlation between

eco-friendly banking practices and client satisfaction is an essential

aspect that need continuous scholarly research (Rai et al., 2019). The

correlation between environmentally friendly banking practices and

client happiness is a crucial element of the contemporary banking and

ﬁnancial services sector. The importance of CS has been widely recog-

nized by the ﬁnancial industry, as it plays a key role in establishing

long-lasting, mutually beneﬁcial, and sustainable relationships with

customers (Ravald &Gronroos, 1996). In fact, a lack of CS has been found

to be a signiﬁcant factor in clients choosing to switch to other banking

institutions (Manari &Manari, 2007a,2007b). The pursuit of CS has

become a crucial principle in the highly competitive contemporary

banking industry, which is vital for retaining customers (Rust &Zahoric,

1993;Zeithaml, Bitner, Gremler, &Pandit, 2013). Green banks offer

numerous advantages such as technological innovation, enhanced

customer experience, and reduced personnel costs, contributing to con-

sumer satisfaction (Abbas et al., 2023;Maheshwari &Chatnani, 2023).

There are various techniques to dealing with environmental concerns,

including as public, commercial, or non-commercial responses (Bhat

et al., 2024). The rising concern of climate change has brought green

banking and green ﬁnance to the fore of discourse and green banking is

essential for promoting environmental sustainability (Gulzar et al.,

2024). Green banking incorporates operational adjustments, necessary

technology, and changing customer habits in the banking industry. It

encourages environmentally beneﬁcial behaviors and ensures an easy

transition to net zero and renewable energy in the future. However, the

banking landscape has evolved with the increasing importance of envi-

ronmental sustainability and ethical banking principles. This has resulted

in the emergence of green banking, which goes beyond

technology-focused approaches to encompass the efforts made by banks

to safeguard the environment and participate in green ﬁnance activities,

as well as compliance with environmental regulations. Signiﬁcantly,

these initiatives are driven by the convergence of environmental con-

cerns and social obligations and have a signiﬁcant impact on CS levels

(Singh, 2015a,2015b;Dittmer, 2015;Fernando &Fernando, 2016;

Campiglio, 2016). The rise of innovative green services and technology

has empowered environmentally conscious consumers to access pro-

visions independently, reducing the need for direct support from service

employees (Bhatnagr &Rajesh, 2023).

2.1. Privacy in green banking

The Privacy can be conceptualized as the level of safeguarding inside

a digital environment, encompassing the safeguarding of customer-

provided information to prevent its unauthorized disclosure or utiliza-

tion for alternative objectives (Masoud &AbuTaqa, 2017;Zeithaml et al.,

2000). This variable holds considerable importance in the realm of green

banking services since clients sense a substantial level of threat or

vulnerability in the digital realm when utilizing this particular online

service and the potential for unauthorized utilization of individuals'

ﬁnancial and personal information is the underlying cause (Kusyanti &

Prastanti, 2017). It is worth noting that security and privacy are widely

regarded as the primary dimensions of green service quality, as shown by

previous research (Jahangir &Begum, 2008). It is important to

acknowledge that in the current study, we integrate these two notions

and treat them as a uniﬁed concept, as has been done by other re-

searchers in the ﬁeld of marketing (Bressoles et al., 2014). Security, as

deﬁned by Parasuraman (2019), includes physical security, ﬁnancial

security, and privacy. It involves protecting data from being accessed,

altered, or destroyed by unauthorized individuals. Privacy refers to the

legal rights of persons and organizations in relation to the sharing of

personal information with external parties (Abreu et al., 2015;Liao &

Cheung, 2005). Customers must have a strong feeling of security while

doing online transactions with a ﬁnancial institution. This is crucial in

building conﬁdence with clients in the ﬁeld of green business (Jahangir

&Begum, 2008).

2.2. Green banking and Customer Satisfaction

Green Customer Satisfaction refers to the level of satisfaction a

customer achieves from consuming products and services that meet or

exceed their green requirements, comply with environmental regula-

tions, or align with societal expectations of sustainability. The main

objective of this approach is to meet environmental requirements and

fulﬁll customer expectations (Chang &Fong, 2010). According to Sab-

harwal (2013), banks can boost their reputation as environmentally

conscientious organizations and lower their carbon footprint by

achieving these requirements within the realm of green banking, the

synchronisation between green banking objectives and consumer ex-

pectations holds signiﬁcant importance as a strategic tool for augmenting

the green corporate image (Maignan, Ferrell, &Ferrell, 2005;Sen &

Bhattacharya, 2001). Customer satisfaction is the driving force behind

customer loyalty, which is characterised by the ongoing patronage of a

A.A. Mir et al. Innovation and Green Development 4 (2025) 100221

certain company’s goods or services, leading to enduring relationships

with the business. As stated by Oliver (1997), loyalty can be deﬁned as

the ongoing choice to engage in repeat purchases or sustained utilization

of a certain product or service over time. The manifestation of loyalty is

evident in customers consistently selecting the same product or service

and advocating for its merits to others.

The concept of customer satisfaction has gained signiﬁcant emphasis

in recent years, both in academic discussions and real-world applications.

Amir (2021) astutely argues that there is a noticeable lack of study on

green banking, indicating a pressing need for further examination. The

issue is often acknowledged, as Sharma and Choubey (2021) similarly

voice their concerns over the scarcity of research in the ﬁeld of green

banking. The existence of signiﬁcant disparities in the ﬁeld of green

banking becomes evident when examining the global context. Developed

nations have shown signiﬁcant efforts in adopting and incorporating GBP

into their ﬁnancial systems, as evidenced by the extensive literature on

the subject (Jeucken, 2010;Kumar et al., 2022;Mir &Bhat, 2021;Roca &

Searcy, 2012; Weber, 2016). However, it is noteworthy that developing

countries have generally overlooked this essential aspect of sustainable

ﬁnance. Prakash et al. (2018) noted a lack of research devoted to green

banking in India, a country characterized by its dynamic and diversiﬁed

nature.

The progress of CS research within the banking sector has witnessed a

transformative shift, increasingly incorporating environmental consid-

erations into its discourse. However, conventional studies traditionally

prioritized factors such as product quality and corporate image, the

emergence of green customer satisfaction, as elucidated by scholars like

Iqbal (2020) underscores the critical importance of integrating green

product quality and corporate image into the framework of customer

loyalty. The research conducted by Gulzar et al., (2024) emphasized on

the green banking on environmental performance and found signiﬁcant

relationship. The research conducted by Mir and Bhat (2021) explained

GBP in selected banks of India. This evolution is further supported by

investigations such as those conducted by Nisha (2016), throwing light

on how customers' perceptions of green banking inﬂuence their attitudes

towards participating banks. The research conducted by Herath and

Herath (2019) on green banking and CS found the signiﬁcant impact.

The research has further concluded that it is important for banks to

consider customer side and its satisfaction which is the end user for any

organisation. The qualitative study performed by Sharma and Choubey

(2021) on the green banking industry discovered that green banking

activities have a beneﬁcial impact in rebuilding consumer trust by

improving the green brand image. Therefore, banks should prioritise

customer happiness while carrying out their operations. According to

Chen and Chang (2013), implementing green initiatives may enhance

customer trust and their willingness to buy a product or service. There-

fore, it is crucial to prioritise consumer happiness while providing green

services, as emphasized by Gefen and Straub (2004). Furthermore,

studies by Islam et al. (2014, pp. 1–6);Bhat et al. (2024);Sharma et al.

(2014);Mir and Bhat (2021) accentuate the escalating consumer demand

for environmentally-conscious banking services and the advantageous

outcomes for banks aligning with green practices. However, despite these

advancements, a noticeable gap persists in comprehending customer

expectations and utilization patterns concerning green banking products,

as underscored by Risal and Joshi (2018). Thus, while strides have been

taken in recognizing the signiﬁcance of green initiatives for CS and

sustainability in banking, further research is imperative to bridge the

divergence between customer expectations and actual banking practices.

Research on CS in banking has advanced due to the works of Swamina-

than and Ananth (2010);Iqbal (2020);Yi (2010);Ma (2012) and

Mobarek (2007). These studies highlight the intricate interactions be-

tween different factors that affect customer loyalty and the crucial roles

that usability and service quality play in ensuring satisfaction. This

in-depth knowledge of CS in both traditional and green banking envi-

ronments serves as the basis for creating strategies that successfully adapt

to changing consumer needs and advance sustainability.

The majority of research on environmental management and corpo-

rate social responsibility in the banking sector is carried out in India

(Bahl, 2012;Bihari, 2010;Narwal, 2007;Rajput et al., 2013;Sahoo &

Nayak, 2007;Sharma &Mani, 2013;Tara, Singh, &Kumar, 2015).

Moreover, new studies investigating the connection between ﬁnancial

services and pandemic consumer satisfaction, like Shabir et al. (2023)

study, provide cross-national data to pinpoint more widespread patterns.

However, previous studies have overlooked how customers' behaviour

affects the adoption of GBP within the existing framework (Bukhari,

Hashim, &Amran, 2021). Consequently, there is a dearth of research on

green banking in India, and much less on the general level of consumer

satisfaction with green banking. The majority of emphasis has been

focused on the opinions of bankers and customers or GBP. To properly

understand the dynamics of GBP, including digital banking, green loans,

green infrastructure and green services, as well as how they impact CS in

the context of India, further study is obviously needed.

The Conceptual mode explains the relationship of GBP and CS with

the mediating variable as privacy in the relationship of the independent

variable and dependent variable.

As the objectives of this study aim to understand how various aspects

of green Banking practices affect customer satisfaction. The dimensions

that will be studied include digital banking, green infrastructure, green

loans and green services, examining each of these dimensions and how

they impact customer satisfaction is crucial for Banks that want to adopt

environmentally responsible practices. The Conceptual Model that has

been crafted based on the dimensions identiﬁed in the literature review,

for the purpose of the study. This model has been developed with a view

to providing an insightful interpretation of the related phenomena. The

model has been designed to reﬂect the speciﬁc parameters that have been

considered as signiﬁcant in this context. Thus, the present study posits

the following hypotheses.

H1(a). There is signiﬁcant impact of digital Banking on Customers

Satisfaction in select public and private sector Banks.

H1(b). There is signiﬁcant impact of green infrastructure on Customers

Satisfaction in select public and private sector Banks.

H1(c). There is signiﬁcant impact of green loan on Customers Satis-

faction in select public and private sector Banks.

H1(d). There is signiﬁcant impact of green services on Customers

Satisfaction in select public and private sector Banks.

H2(a). Mediating role of Privacy signiﬁcantly effects the relationship

between digital banking and customer satisfaction

H2(b). Mediating role of Privacy signiﬁcantly effects the relationship

between green infrastructure and customer satisfaction.

H2(c). Mediating role of Privacy signiﬁcantly effects the relationship

between green loan and customer satisfaction.

H2(d). Mediating role of Privacy signiﬁcantly effects the relationship

between green services and customer satisfaction.

3. Methodology

To ensure the collection of a comprehensive and inclusive sample for

this study, guidelines advocated by notable researchers have been fol-

lowed. Roscoe’s, (1975);Sekaran and Bougie, (2016) sample size of 500

or less is suitable for most behavioural studies while as a sample size

larger than 500 may lead to a Type II error. Comrey and Lee (2013);Hair,

Sarstedt, Ringle, and Mena (2012) and Qazi et al. (2020) considered 500

sample size as best. The purpose of this systematic approach was to

guarantee that the chosen sample effectively represents the various fea-

tures and variety found among the customer base in the Top four Private

and Public banks throughout divisions and areas of Jammu and Kashmir.

The comprehensive geographical scope of this study assures that the

conclusions drawn from it can be applied to a broader population beyond

A.A. Mir et al. Innovation and Green Development 4 (2025) 100221

a single location, thus increasing the study’s external validity.

The adoption of Probability cluster Sampling, together with the

integration of Convenient Sampling, in this research introduces a note-

worthy methodological strategy that is particularly well-suited for the

descriptive bank customer-based study. The incorporation of Convenient

Sampling into a cluster sampling framework introduces a degree of

adaptability to the study design. The utilization of the cluster sampling

strategy brings a degree of randomness and structure to the process of

selecting a sample. The selection of Probability Cluster Sampling with

Convenient Sampling is ultimately inﬂuenced by the researcher’s un-

derstanding of the study’s objectives and the acknowledgment that, in

speciﬁc circumstances, an approximate comprehension of the truth

serves as a helpful initial step toward subsequent investigation and

improvement. Table 1 shows the details of districts in two divisions of

Jammu and Kashmir selected randomly each from Jammu and Kashmir

along with their respective branches.

The participants in this study are those who are associated with the

banking business in the Jammu and Kashmir and the research looked at

individual bank branches as its unit of analysis since banks organize

around their branches, and act as an essential part of the processes that

constitute “green banking.”The primary channel through which the or-

ganization communicates with its different kinds of stakeholders is via

the branches of the bank. Customers of select private and public sector

banks participated as respondents for the structured survey. The data was

gathered through adopted questionnaires that were distributed to re-

spondents by way of Google Forms &by visiting branches to get the

questionnaires ﬁlled by the customers. Questionnaires were distributed

at random to the bank customers of different branches in each of the

districts that were chosen for the study. It is pertinent to mention here

that districts from the Kashmir division were selected systematically. The

customers of selected banks (SBI, PNB, J&K Bank, HDFC) were selected

randomly from the randomly selected branches to carry out the sampling

that was carried out inside selected districts of Jammu and Kashmir. A

research sample consisting of the top 47 branches was obtained. The total

number of questionnaires that were handed out was 580 and a total of

500 questionnaires were considered ﬁt for sampling after removing all

discrepancies. In this research, the response rate was over 86 percent

from the banking customers.

3.1. Scale source

The questionnaire developed in this study to collect primary data was

purposefully adopted from the literature. This was done with the inten-

tion of effectively investigating the diverse aspects and viewpoints per-

taining to GBP, as well as their inﬂuence on CS (Table 2 and Appendix 1).

4. Results and analysis

4.1. Measurement model

The demographic information revealed that the bulk of the re-

spondents were male, who accounted for 66.0% of the total, while the

contribution of females was 34.0%. In addition, the age categories with

the greatest number of responders were those ranging from 30 to 45

years old (43.3% of the total) and 18–30 years old (35.7%) accordingly.

In addition, respondents with graduation degree made up 22.6% of the

total respondents, while master’s degree holders made up 61.6% while

only 10.3% and 5.5% of respondents held Ph.D. or M. Phil degrees

respectively. The examination of the reﬂective measurement model was

the ﬁrst order to conﬁrm the variables' dependability and validity, we

carried out the quality tests recommended by Darsono et al. (2019) and

Hair et al. (2019).“The correlation between a particular factor and its

items is referred to as the indicator loadings”. Indicator loading and

convergent validity are shown by the outer loading of the variable items,

and it should be more than 0.708 for the study to be considered valid. In

addition to this, the reliability measure has to be more than 0.70, and the

AVE, which is also known as the convergent validity check, needs to be

near 0.50 or higher. The speciﬁcs of the reﬂective measurement model as

well as the outcomes of all of the predetermined criteria for outer

loading, Cronbach’s alpha, composite reliability and average variance

extracted found within threshold limit (Table 3 and Fig. 2). Accordingly,

the results of the discriminant validity test, which was conducted using

the Fornell-Larcker criteria, are shown in Table 4.“The square root of

each construct’s AVE is higher than its correlation with another

construct”. The results of Table 4 demonstrated that AVE is above the

threshold limit as required hence no issue in discriminant validity as per

Fornell-Larcker criterion. The HTMT Value of each variable must less

than 0.90 in order to satisfy this requirement for discriminant validity

(Henseler et al., 2015) and found issue in discriminant validity as per

HTMT approach (Table 5). Table 3 summarises the results, together with

the conventional approximation of factor loadings that had been used in

arriving at a conclusion of GB practices, Privacy, and CS dimensions. The

standard factor loadings used in the CFA analysis for GB dimensions

ranges from 0.739 for DB4 and 0.897 for P2 which is more than the

threshold line of 0.5 that was proposed by Hair, Sarstedt, Ringle, and

Mena (2012). To assess the dependability of CS on GBP and privacy in the

banking sector, Average variance extracted, Composite reliability and

Cronbach’s alpha were computed. As seen in Table 3, the GBP like Digital

Banking, Green services, Green Infrastructure, and Green Loans, all had

Cronbach’s alphas that were higher than the required minimum of 0.70,

while the Cronbach alpha for privacy higher among all with somewhat at

0.909. The outcomes of the CFA model used in the investigation as well

as the standardised estimates. The ﬁndings of the CR for the four different

constructions vary from 0.837 to 0.913, which is above the baseline

Table 1

For districts with bank branches.

Kashmir Division Number of Branches

S. no Districts SBI PNB JKB HDFC

1 Srinagar 27 15 97 19

2 Ganderbal 3 1 25 2

3 Budgam 7 1 54 4

4 Kulgam 2 3 28 1

5 Anantnag 10 5 66 4

6 Pulwama 5 2 52 5

7 Shopian 1 1 24 1

8 Kupwara 6 2 37 2

9 Baramulla 10 2 62 3

10 Bandipora 2 2 21 1

Jammu Division Number of Branches

S. No Districts SBI PNB JKB HDFC

1 Poonch 3 1 26 2

2 Rajouri 7 3 40 2

3 Samba 9 7 23 3

4 Udhampur 9 8 31 3

5 Jammu 41 42 100 27

6 Reasi 6 3 23 2

7 Kathua 11 9 37 3

8 Ramban 4 2 17 1

9 Doda 9 2 32 2

10 Kishtwar 2 1 23 1

Source: (JK UTLBC, 2023).

Table 2

For Scales used in the study.

Variables Items Scale Source

Digital Banking 5 Shaumya and Arulrajah (2016)

Green Infrastructure 5 Parasuraman (2019)

Green Loan 5 Parasuraman (2019)

Green Services 5 Parasuraman (2019)

Privacy 5 Hammoud et al. (2018)

Customer Satisfaction 7 Hammoud et al. (2018)

A.A. Mir et al. Innovation and Green Development 4 (2025) 100221

Green banking practices and customer satisfaction-way togreen sustainability

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