Problems and prospects of electronic banking in nigeria. The history of cbn dates back to the g paton report of 1892 1952, there was an enquiry by the then colonial administration to investigate banking practice in nigeria. Electronic banking, or ebanking, is the term that describes all transactions that take place among companies, organizations, and individuals and their banking institutions. Electronic banking, more commonly known as ebanking, is the newest delivery channel for banking services. The service was developed by stanford federal credit union, which is a financial institution. Ebanking definition of ebanking electronic banking, also known as electronic funds transfer eft, is simply the use of electronic means to transfer funds directly from one account to another, rather than by cheque or cash. The study became necessary due to the increased adoption of the electronic banking which has redefined the banking service both in nigeria. Nigeria is home to a concentrated banking sector, with the 5 largest banks accounting for 62% of total commercial bank s assets in 2016. Impact of electronic banking on customer satisfaction chapter one introduction 1. The evolution of online banking started in the 1980s. Arising from the three major roles of the cbn in the areas of monetary policy, financial system stability and payments system oversight, the cbn technical committee on ebanking has produced a report, which anticipates the.
This was in furtherance of the apex banks efforts to leverage technology. Pdf on may 1, 2008, ikechukwu acha and others published electronic banking in. History the commercial bank was founded in 1924 by local businessmen in oglethorpe county with the mission of serving the financial needs of the citizens and businesses of the area. Downloading bank statements, for example in pdf format. This is approved for students in accountancy, business, computer science, economics, engineering, arts. Vision 2020 would help the industry to understand the future evolution of banking and the evolving strategies for reaping maximum benefits from the changing scenario in banking and financial landscape. The history of the banking system in nigeria can be traced to the african banking corporation and british west africa which was established in 1892. There a basically three departments in the central bank of nigeria and they are the banking. It discovered that the increased application of e banking worldwide is a function of improvement in information and communications technology ict. Nigeria is home to a concentrated banking sector, with the 5 largest banks accounting for 62% of total commercial banks assets in 2016.
Electronic banking system in nigeria 2961 words bartleby. Electronic banking is now a global phenomenon and is now utilized by countries round the world and nigeria is not an exception. Ebanking services features, challenges and benefits 51 2. Overview of electronic banking in nigeria international journal of. The electronic delivery channels are collectively referred to as electronic banking. The impact of information technology in nigerias banking. A bank is generally understood as an institution which provides fundamental banking services such as accepting deposits and providing loans. Panel data comprised annual audited financial statements of eight banks that have adopted e and retained their. Electronic banking has become a very important and indispensable too1 for the.
Banking has come a long way since the days of regular visits to tellers. Banking sector forms of electronic banking clients use modern communication media for remote communication with the bank. Electronic banking and the challenges of the ghanaian. Electronic banking services have become an important practice among commercial banks in nigeria. Electronic banking is really not a technology, but an attempt to merge several different technologies. The research geared toward explaining what electronic. Functions of e banking at present, the personal e bank system provides the following services. The cbn recognizes that electronic banking and payments services are still at the early stages of development in nigeria. The use of electronic banking in nigeria has now become a timesaving factor enabling multiple tasks to be done within a short period of time. The impact of electronic banking in nigeria banking system. The researcher general towards explaining what electronic banking is all about and when it was introduce into nigeria. Issues and challenges article pdf available in research journal of finance and accounting 86 february 2017 with 11,929 reads how we measure reads. According to sanusi 2002 as cited by dogarawa 2005.
Much has changed since 1924, but the commercial banks commitment to. E banking gives customer the control over nearly every aspect of managing his bank accounts. The next landmark in the history of banking business was the enactment on 15th may 1958, of the central bank of nigeria act which provided for the establishment of a bank to issue, the notes and coins of which should be legal tender throughout nigeria. Electronic banking in nigeria is however a critical variable with national standard improving capacities and posses several. Brief history of distress in the nigerian financial system.
Furthermore, through its successful initial public offer in 2001 the bank raised in excess of n25 billion from the nigerian capital market and its branches strategically located in major commercial cities across the country. The role of the central bank was to establish the nigerian currency, control and regulate the banking system, serve as bankers to other banks in nigeria. Apr 27, 2018 with this practice, it is believed that the less the pure cash that is used for transactions within a society, the more viable it is to conduct business and banking activities electronically. Brief history of atm automated teller machine atm, according to ogbuji, onuoha and izogo 2012 was conventionally introduced as an electronic delivery channel in 1989 and was first installed by national cash registers ncr for the defunct societe general bank of nigeria sgbn in the same year.
Electronic banking is the use of electronic and telecommunication networks to deliver a wide range of value added products and services to bank customers s teven, 2002. Hours spent engaging in rigorous and stressful transaction processes at the bank can be saved and used for something meaningful and beneficial. Financial inclusion is one of the objectives of the central bank of nigerias cashless policy introduced in nigeria in the year 2011. The history of banking operation and supervision in nigeria could be traced to the period between 1892 and 1894 when african banking corporation and first bank of nigeria which was formerly known as the bank of british west africa bbwa.
The impact of electronic banking in nigeria banking system pdf. The research geared toward explaining what electronic banking is all about and when it was introduce into nigeria. May, 2019 money, in some form, has been part of human history for at least the last 3,000 years. Thus, online banking has the tendency to encourage multitasking which is a positive working variable.
National bank of nigerian limited, which was to make history by being the first. It is in this regard, that the central bank of nigeria cbn introduced the cashless policy with the objective of promoting the use of electronic payment channels instead of cash. Pdf on feb 11, 2017, sunday oseiweh ogbeide and others. This was around 2000 bc in assyria, india and sumeria. Simply put, electronic banking is the process by which a bank customer initiates banking transactions via electronic device without visiting the brickandmortar institution. The introduction of e banking services has improved banking efficiency in rendering services to customer. Get free research paper on an appraisal on the impact of electronic banking on the banking sector study of diamond bankproject topics and materials in nigeria. E banking, it also observed, holds enormous potentials for the banking industry in nigeria. Acharacteristic feature of these services is the clientsuninterrupted roundtheclock account access, i. Get free research paper on electronic bankingproject topics and materials in nigeria.
Nigeria banking reform can be divided into two main phases, 2004 and 2009. Electronic banking is the conduct of banking business electronically which involves the use of information communication technology to drive banking business for immediate and future goals. Electronic banking and profitability of commercial banks. According to report of technical committee on e banking cbn, 2003, e banking can be defined as a means whereby banking business is transacted. There have been investments in computer hardware, software and telecommunication equipment, the corollary of which has been the introduction of electronic bank e banking in the nigeria banking industry.
People now stay comfortably in their homes and perform a banking transaction using electronic devices without increasing road traffic. Another study was conducted in 1957 and this resulted in the creation of a nigerian central bank and the introduction of the nigerian currency. The introduction of e banking epayment products in nigeria commenced in 1996 when the cbn granted all states trust bank approval to introduce a closed system electronic purse called esca. The history of internet banking 1983 2012 subscribe now get the financial brand newsletter for free sign up now. Impact of electronic banking on customer satisfaction. History of ebanking in nigeria information in nigeria. Electronic banking using a telephone connection can be divided into phone banking ats, client advisor and mobile banking sms banking, gsm sim toolkit and wap. It has made banking easier and as a matter of fact created mobile service for bank users. Meaning of e banking e bank is the electronic bank that provides the financial service for the individual client by means of internet. The term online banking became popular in the late 80s and referred to the use of a terminal keyboard and tv monitor to access the banking system using.
Electronic banking has many advantages and should be highly encouraged. Consumers could purchase goods and services from the internet and send unencrypted credit card numbers. Download this complete banking and finance project material titled. Problems and prospects abstract this research work is an attempt to analyse and find out the problem and prospects of eletronic banking in nigeria. It is in this context, we hope that this report on banking on the future. First conceptualized in the mid1970s, some banks offered customers electronic banking in. The online banking system will typically connect to or be part of the core banking system operated by a bank and is in contrast to branch banking. First conceptualized in the mid1970s, some banks offered customers electronic banking in 1985. The history of banking began with the first prototype banks which were the merchants of the world, who gave grain loans to farmers and traders who carried goods between cities. In the current era, online banking was bringing a huge evolution in the banking industry like automated teller machines, phone banking, credit cards, mobile banking and electronic cash jeevan. Online banking, also known as internet banking or web banking, is an electronic payment system that enables customers of a bank or other financial institution to conduct a range of financial transactions through the financial institutions website. Paton report which emanated from the enquiry was the basis for the first banking ordinance of 1952. The rise of electronic devices has also made electronic banking in nig eria, a rising trend. Electronic business is the use of internet facilities to connect, facilitate and empower business process activities and effective flow of communication and collaboration within an organization and organization with its customers, suppliers, other business stakeholders and the outside world electronically.
Since electronic banking started in all nigeria banks, it has been a woe for civil servants. We do so to see if the effects of the relatively more matured banking sector in south africa, and nigeria are driving averages in those subregions. In the case of southern africa, we also experiment by excluding mauritius, but. The challenger banks in nigeria the central bank of nigeria cbn recently introduced regulations and guidelines for the licensing and operations of psbs in the country. The adoption of information and communication technology in banking sector is generally referred to as electronic banking e banking and application of its concepts, techniques, policies, and implementation strategies to banking services has become. Electronic banking in nigeria problems and prospects abstract this research work is an attempt to analyse and find out the problem and prospects of eletronic banking in nigeria.
Ebanking, atm, networking, debit card, credit card introduction although a lot of research works has been done on the prospects and challenges of information technology in the banking industry, research works are broad based and only few are actually carried on electronic banking ebanking. Payment systems and financial innovation in nigeria nigeria. Arising from the three major roles of the cbn in the areas. This study investigated the influence of electronic banking products on performance of nigerian dmbs. Have your paycheck deposited directly into your bank or. Introduction internet banking or ebanking means any user with a personal computer and a browser can get connected to his. Origin of electronic banking in nigeria through telephone banking include account balance funds conventional banking system started in nigeria in 1952. Click to find out how to deposit cash to an online bank account the history of banking via the internet. The effect of electronic banking on the financial performance. The study became necessary as a result of increased penetration of electronic banking which has redefined the banking operations in nigeria and world over. The first online banking service in united states was introduced, in october 1994. Ebanking, functions, advantages, limitations, traditional banking services.
In service organization like banks, information flows more than physical items. The impact of electronic banking on financial inclusion in. The act also provided that the central bank is the. Electronic banking has reduced dependence on certain locations before performing certain banking transactions. Besides the customers can, buy and sell securities, check stock market information, check currency rates, check balances, see which checks are cleared, transfer money, view transaction history and avoid going to an actual bank. The impact of information technology in nigerias banking industry 1oluwagbemi oluwatolani 2abah joshua and 3achimugu philip abstracttoday, information technology it has become a key element in economic development and a backbone of knowledgebased economies in terms of operations, quality delivery of services and productivity of services. Ebanking and commercial bank performance in nigeria. This makes the country to be heavily cash based economy. In the same vein but from bank growth perspective, abubakar 2014 discovered the existence of a significant. Salehi and zhila, 2008, describes e banking as an electronic connection between bank and customer in order to prepare, manage and control financial transactions. The guidelines issued in august 2003, at the infancy of electronic banking and payment systems in nigeria, sought to address the following key issues a information and.
The concept of financial inclusion has continued to gain global acceptance since it was identified as one of the key drivers of inclusive economic growth and development. The adoption of information and communication technology in banking sector is generally referred to as electronic banking ebanking and application of its concepts, techniques, policies, and implementation strategies to banking services has become. The researcher general towards explaining what electronic banking is all about and when it. The bank was issued a universal banking license by the central bank of nigeria cbn. Ebanking conceptual framework remote banking, considered representative for the new economy, consists of electronic transactions between customers and their bank. A few decades later specifically in 1925, the angloegyptian bank and the national bank of south africa forged an alliance which led to the creation. This offers banking institutions a new frontier of opportunities and challenges further augmenting competition in the global banking market. History of the internet in africa internet society.
Fluid history analysis a new concept for prospect evaluation. This work studied the relationship between electronic banking and the performance of nigerian commercial banks. Now a customer can take a picture of a check with his phone to deposit it into a savings or checking account and receive sms banking alerts in the form of texts. However, the cost of cash to nigeria financial system is high and increasing. Impact of ebanking on the development of banking sector in nigeria. Consequently, nigerian bank s investments in information technology it equipment have grown rapidly in the last ten years. The population of the study is all the twentyone deposit money banks. This resulted in rebasing of commercial banks from. Pdf overview of electronic banking in nigeria chris onodugo. Before that time, it is assumed that a system of bartering was likely used. The online banking services are becoming more and more prevalent due to the welldeveloped systems.
Impact of mobile banking on service delivery in the. Phone banking is the provision of banking services using aclassic telephone line. The study is motivated by the apparent low level of satisfaction with the level of epayment system in nigeria. The arrival of the internet has taken electronic payments and transactions to an exponential growth level. The study investigates the federal government of nigeria electronic payment system implementation and the constraints confronting it with a view to providing solutions to the constraints so identified. The study aims at examining the impact of mobile banking on. Electronic banking today is one out of the thousands of technologically advancement paving ways in africa especially nigeria.
Electronic banking can also be defined as a variety of following platforms. Electronic banking and the common banking products. The precursor for modern home online banking services were the distances banking service over the electronics media from the early 80s. Later, in ancient greece and during the roman empire, lenders based in temples gave loans, while accepting deposits and performing the change of money. However, this system has some hitches that need to be removed. The remaining 17 banks held 38% of the marketshare in total. May 21, 2019 click to find out how to deposit cash to an online bank account. The crux of this study is on the adoption of epayment system in nigeria. The importance, effect, causes, relationship, comparison, history, role, solutions are discussed.
In the commercial world, especially in most advanced societies today, money is. Central bank of nigeria guidelines on electronic banking in nigeria preamble the cbn recognizes that electronic banking and payments services are still at the early stages of development in nigeria. Though, various ebanking systems have been implemented and accepted by. The money you spend in transporting yourself to the bank to perform a transaction can be. The role of ebanking on operational efficiency of banks. Arising from the three major roles of the cbn in the areas of monetary policy, financial system stability and payments system oversight, the cbn technical committee on ebanking has produced a report, which anticipates the achievements of cbns core objectives toward electronic banking and payment.
The rapid changes in business operations in contemporary times in the form of technological improvement require banks in nigeria to serve their customers electronically. Electronic banking in nigeria saves the time of both the customer and the time of the banking officials. In the light of this, the research seeks to examine the impact of electronic banking on. The central bank of nigeria cbn recognizes that electronic banking and payments services are still at the cradle stages of development in nigeria. Pdf overview of electronic banking in nigeria chris. The impact of electronic banking in nigeria banking system critical appraisal of unity bank plc with abstract, chapter 15, references and questionnaire.
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