Effect of electronic banking on financial performance of deposit money banks in Nigeria
-
Author(s)Joseph MadugbaLink to ORCID Index: https://orcid.org/0000-0001-8929-1905
,
Ben-Caleb EgbideLink to ORCID Index: http://orcid.org/0000-0003-2188-2535
,
Dike Wozuru Jossy
,
Uche Toby Agburuga
,
Onwubiko Onyebuchi Chibunna
-
DOIhttp://dx.doi.org/10.21511/bbs.16(3).2021.07
-
Article InfoVolume 16 2021 , Issue #3, pp. 71-83
- Cited by
- 3052 Views
-
2874 Downloads
This work is licensed under a
Creative Commons Attribution 4.0 International License
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.
view full abstract
- Keywords
-
JEL Classification (Paper profile tab)G20, G21
-
References51
-
Tables5
-
Figures2
-
- Figure 1. Normality test histogram for EPS
- Figure 2. Normality test histogram for ROA
-
- Table 1. Descriptive statistics
- Table 2. Normality test
- Table 3. Multicollinearity test results
- Table 4. Regression result for Hypothesis 1
- Table 5. Regression result for Hypothesis 2
-
- Abdallah, A. A. (2013). The impact of using Accounting Information system on the quality of Financial Statement submitted to the income and Sales Tax Department in Jordan. European Scientific Journal, 9(10), 41-48.
- Abu-Musa, A. (2009). Evaluating the Security of Computerized Accounting Information Systems. An empirical study on the Egyptian Banking Industry (Ph.D. Thesis). Aberdeen University, UK.
- Addae-Korankye, A. (2014). The impact of E-banking on customer services and the profitability of banks in Ghana. Global Journal of Commerce and Management Perspective, 3(1), 61-65.
- Adelisa, A. (2017). Assessing the Impact of Computerized Accounting System used on Organization in Tanzania: Case Study of LGAs in Arusha Region (Master’s Thesis). Mzumbe University.
- Adewuyi, A. O., & Akpokodje, G. (2013). Exchange rate volatility and economic activities of Africa’s sub-groups. The International Trade Journal, 27, 349-384.
- Aduda, J., & Kingoo, N. (2002). The relationship between electronic banking and financial performance among commercial banks in Kenya. Journal of finance and investment analysis,1(3), 99-118.
- Agboola, A. A. (2001). Impact of Electronic Banking on Customer Services in Lagos, Nigeria, Ife Journal of Economics and Finance. Department of Economics, 5(1&2), 27-36.
- Akande, O. O. (2016). Computerized Accounting System Effect on the performance of Enterpreuers in South-Western Nigeria. Proceeding of ISER International Conference. Birmingham, UK.
- Akesinro, S. A., & Adetoso, J. A. (2016). The Effects of Computerized Accounting System on the Performance of Banks in Nigeria. Journal of Economics and Sustainable Development, 7(14), 76-82.
- Al-Adwan, M. M., Al-Zyood, M., Ishtaq, M., & Arabia, S. (2013). The impact of electronic payment on Saudi Banks profitability: A case study of Sadad payment system. IJRRAS, 14(1).
- Aliyu, A., & Tasmin, R. B. (2012). The impact of information and communication Technology on Banks’ Performance and Customer Service Delivery in the Banking industry. International Journal of Latest Trends Finance, Economics and Social Sciences,2(1), 80-90.
- Alshaefee, A. A. G. H. (2007). Accounting Information Systems and Its Application in Petroleum Companies in Yemen (Unpublished Doctoral Thesis). University of Pune, Pune, India.
- Alshebeil, A. H. (2010). Accounting Information Systems and organization, theory with Study Case Dar Althaqafa library for publishing and distributing. Jordan.
- Ama, G. A. N. (2004). Simplified Financial Accounting. Nigeria: John Jacob’s Classic Publishers Ltd.
- Amidu, E., Effah, J., & Abor, J. (2011). E-Accounting Practices among Small and Medium Enterprises in Ghana. Journal of Management Policy and Practice, 12(4), 146-155.
- Amveko, A. (2011). Computerized Accounting Systems and Financial Reporting (Unpublished Thesis). Makerere University, Kampala.
- Ayo, C. K., Uyinomen, O. E., Ibukun, F. T., & Ayodele, A. A. (2007). M-Commerce Implementation in Nigeria: Trends and Issues. Journal of Internet Banking and Commerce, 12(2), 1-15.
- Barney, J. B. (2006). Looking inside for competitive advantage. Academy of Management Executive, 9(4), 49-65.
- Beg, K. (2018). Impact of Accounting Information System on the Financial Performance of Selected FMCG Companies. Asian Journal of Applied Science and Technology (AJAST), 2(3), 8-17.
- Bertalanffy, L. Von (2009). An outline of general system theory. British Journal for the Philosophy of Science, 1(2), 134-165.
- Breen, J. P, Sciulli, N., & Calvert, C. (2003). The Use of Computerised Accounting Systems in Small Business. In The 16th annual conference of the Small Enterprise Association of Australia and New Zealand. Ballarat, Victoria.
- Brewer, H., & Lunsford, J. (1995). Don’t Let Technology Pass You By. ABA Banking Journal, 87(10), 73.
- El-Dalabeeh, A. (2012). The Role of Computerized Accounting Information Systems in Reducing the Costs of Medical Services at King Abdullah University Hospital. Interdisciplinary Journal of Contemporary Research in Business, 4(6), 893-900.
- Eveka-Nwokeji, N. A. (2012). Repositioning Accounting Information System through Effective Data Quality Management: A Framework for Reducing Costs and Improving Performance. International Journal of Scientific & Technology Research, 1(10), 86-94.
- Gelinas, U. J., Sutton S. G., & Hunton, J. E. (2005). Accounting information systems (6th ed.). USA: South-Western College Pub.
- Hassan, S. U., Mamman, A., & Farouk, M. A. (2013).Electronic banking products and performance of Nigerian listed deposit money banks. American Journal of Computer Technology and Application, 1(10), 138-148.
- Hoopes, D. G., Madsen, T. L., & Walker, G. (2003). Guest editors’ introduction to the issue: why is there a resource-based view toward a theory of competitive heterogeneity. Strategic Management Journal, 24(10), 889-902.
- Hossein, S. M. (2013). Consideration of the effect of E-banking on banks profitability: A case study of selected Asian Countries. Journal of Economics and Sustainability Development, 4(11), 112-117.
- Ismail, N. A. (2007). The Impact of Information Technology on Performance: The Mediating Role of Management Accounting system. Jurnal Teknologi, 46(E), 27-44.
- Ismail, N. A., Abdullah, S. N., & Mahamad, T. (2003). Computer-based accounting system: The Case of manufacturing-based SME in the Northern Region of Peninsular Malaysia. Journal Technology, 39(E), 19-36.
- Kathuo, S., Rotich, G., & Anyango, W. (2015). Effect of mobile banking on the financial performance of bank institutions in Kenya. The Strategic Journals of Business and Change Management, 2(98), 1440-1457.
- Khan, A. (2017). Impact of Accounting Information System on The Organizational Performance: A Case Study of Procter and Gamble. Star Research Journal, 5(12), 26-30.
- Kloviene, L. I., & Gimzauskiene, E. (2015). The Effect of Information on Accounting System’s Conformity with Business Environment: A Case Study in Banking Sector Company. Procedia Economics and Financial, 32, 1707-1712.
- Korpelainen, E. (2011). Theories of ICT System Implementation and Adoption – A Critical Review (1st ed.). Finland.
- Laudon, D. P., & Laudon, J. P. (1991). Business Information System: A Problem Solving Approach New York, HBJ, College Publishers.
- Madugba, J. U., Ekwe, M. C., & Okezie, S. (2016). Evaluation of the contribution of oil revenue on economic development in Nigeria. International Journal of Economics and Finance,8(6), 210-218.
- Mahmood, M. A., & Mann, G. (2012) Special Issue: Impact of Information Technology Investment on Organizational Performance. Journal of Management Information Systems, 16(4), 3-10.
- Meigs, F. R., & Mary, A (2006). Financial Reporting (9th ed.). United States of America: Irwin Mc Graw Hill Publishers.
- Okoye, E. I., Gbegi, D. O., & Agbaji, J. S. (2012). An Analysis of Computerized Accounting System on Service Delivery in the Banking Sector (Study of First City Monument Bank Plc). Salem Journal of Management Science, 1(1).
- Ololade, B., & Ogbeide, S. (2017). E-Banking in Nigeria: Issues and challenges. Research Journal of Finance and Accounting, 8(6), 16-24.
- Onn, C. W., & Sorooshian, S. (2013). Mini Literature Analysis on Information Technology Definition. Information and Knowledgement, 32(2), 139-141.
- Ovia, J. (2001, September). Internet Banking: practices and potentials in Nigeria. In A paper presented at a Seminar organized by the Institute of Chartered Accountants of Nigeria (ICAN). Lagos Sheraton Hotel & Towers, Ikeja.
- Oyewole, O. S., Abba, M., El-maude, J. G., & Arikpo, I. A. (2013). E-banking and Banks performance: Evidence from Nigeria. International Journal of Scientific Engineering and Technology, 2(8), 766-771.
- Polo, J., & Oima, D. (2013). Effect of Computerized Accounting Systems on Audit Risk in Public Enterprises: A case of Kisumu County, Kenya. International Journal of Education and Research,1(5), 1-10.
- Rajeshwaran, N., & Gunawardana, K. (2009). An Empirical Investigation of the security Controls of computerized Accounting Information Systems (CAIS) in the selected listed companies in Sri Lanka. Proceedings of the 15th Americas Conference on Information Systems. San Francisco, CA.
- Salehi, M., Rostami, V. & Abdolkarim, M. (2010). Usefulness of Accounting Information System in Emerging Economy: Empirical Evidence of Iran. International Journal of Economics and Finance, 2(2). 186-195.
- Soudani, S. N. (2012). The Usefulness of an Accounting Information System for Effective Organizational Performance. International Journal of Economics and Finance, 4(5), 136-145.
- Taiwo, J. N. (2016). Effect of ICT o Accounting Information System and Organizational Performance: The Application of Information and Communication Technology on Accounting Information System. European Journal of Business and Social Sciences, 5(2), 1-15.
- Wilson, R. A., & Sangster, A. (2010). The Automation of Accounting Practice. Journal of Information Technology, 7(2), 65-75.
- Woherem, E. W. (2000). Information Technology in the Nigerian Banking Industry. Spectrum, Ibadan.
- Yadav, M. S. (2016). The Impact of Information Technology on Modern Accounting Systems Concerning Prune Region. International Journal of Research in IT and Management(IJRIM), 6(8), 87-94.
