Effect of electronic banking on financial performance of deposit money banks in Nigeria

Joseph Madugba,Ben-Caleb Egbide,Dike Wozuru Jossy,Onwubiko Onyebuchi Chibunna,Uche Toby Agburuga

doi:10.21511/bbs.16(3).2021.07

Abstract

The impact of technology on commerce cannot be denied, especially in relation to trade. This study was conducted to examine the impact of electronic banking on the financial performance of Nigerian deposit money banks. The data for the study was obtained from the Central Bank of Nigeria’s Statistical Bulletin and the National Bureau of Statistics’ Statistical Bulletin for various years, as well as from published financial statements of the banks under study. An ex-post facto research design was used and a normality test was carried out to establish the goodness of the data; descriptive statistics and a multicollinearity test were conducted in which the independent variables were found good. Regression was adopted to test two hypotheses. It was found that ATM has a positive and significant association with Earning EPS and ROA; POS and NEFT significantly affect ROA only, while WEB has an insignificant impact on both EPS and ROA. It is concluded that electronic banking significantly affects financial performance of deposit money banks in Nigeria. Thus, the study recommended that deposit money banks in Nigeria should educate their customers more in the use of NEFT, WEB, and POS, and that the amount of ATM withdrawals should be increased to improve bank performance.

Highlights

Electronic banking may be described as a means by which banking products and services are provided through electronic devices such as phones, iPods, etc
Despite extant literature and researchers’ knowledge, there is no study of this nature in the banking industry of Nigeria’s economy that has used secondary seven-year data to examine the impact of electronic banking on the financial performance of money deposit banks in Nigeria to the current date
Decision rule: Accept null hypothesis if the prob- compared to Earnings per share (EPS) of the deposit money banks in ability value computed by E-view is less than or Nigeria

Summary

INTRODUCTION

Electronic banking may be described as a means by which banking products and services are provided through electronic devices such as phones, iPods, etc. Despite extant literature and researchers’ knowledge, there is no study of this nature in the banking industry of Nigeria’s economy that has used secondary seven-year data to examine the impact of electronic banking on the financial performance of money deposit banks in Nigeria to the current date. Out that the application of IT improves the performance of petroleum companies in Yemen He sug- H2: The effect of Automatic Teller Machine gested that petroleum companies in Yemen should (ATM), Web banking (WEB), Point of embrace accounting information systems (AIS) to sale (POS), and National Electronic Fund improve performance. The aim of the study is to examine the impact of (NEFT), Web Banking (WEB), Automatic Teller electronic banking on the financial performance Machine (ATM), Point of Sale (POS), descriptive of deposit money banks in Nigeria.

B NEFT 1

Descriptive statistics

Multicollinearity test

Discussion of results

CONCLUSION