Electronic Banking and Profitability in the Nigerian Banking Industry
The primary objective of this study was to assess the impact of electronic banking on profitability in the Nigeria banking industry. An inferential survey research design was adopted. Primary data were collected through questionnaires from both staff and customers of the surveyed bank. It was complemented with secondary data sourced from the company’s audited financial statements for the period 2010 to 2017. Data collected were analyzed using both descriptive and inferential statistics while testing of the hypotheses was done using multiple regression analysis. The study revealed that cards play a significant role more than other channels and immediately followed by ATM. Also, it was observed that E-Banking channels contributed to Bank's profitability, that E-banking services (EBS) had an influence on the retention and loyalty of bank's customers and that the quality of service, security, reliability and efficiency have a definite impact on the usage of the services of e-banking. It was recommended that the Nigerian banking industry should invest more in card products, followed by ATM amongst other electronic channels; as they generate more revenues for the bank. The study also recommended further development of other channels (Mobile, Corporate Payments, POS and internet banking) to further enhance their contribution to the bank's profitability. Nigerian banks should also create a business strategy that is customer-centric by being continuously innovative in identifying the needs of their customers and improving on their products offering while developing new ones, to retain and keep the loyalty of their existing customers while attracting new ones.
Abaenewe, Z.C., Ogbulu, O. M. & Ndugbu, M. O. (2013) Electronic Banking and Bank Performance
In Nigeria. West African Journal of Industrial and Academic Research. 6(1), 171-
Ajzen, I. (1991) The theory of planned behavior. Organizational Behavior and Human Decision
Processes, 50(2), 179 – 211.
Angelakopoulos, G. &Mihiotis, A. (2011) E-banking: challenges and opportunities in the Greek
banking sector. Electronic Commerce Research. 11(3), 297-319.
Ashtiani, P. G. &Iranmanesh, A. (2012) New approach to study of factors affecting adoption of
electronic banking services with emphasis on the role of positive word of mouth. African Journal of Business Management, 6(11), 4328-4335.
Awolusi, O.D. (2012) “Effectiveness of total quality management on business performance
in Nigerian manufacturing firms: an empirical analysis”, International Journal of Enterprise Network Management 5 (3), 254-271
Awolusi, O.D. & Onigbinde, I.O. (2013), “Enterprise Resourse Planning and organizational
performance in Nigerian manufacturing firms: an empirical analysis”, Global Journal of Commerce and Management Perspective 2 (4), 12-23
Awolusi, O.D. & Akinruwa, T.E. (2014), “Cultural Combination and International Acquisition
Performance of Multinational Corporations in Nigeria”, Global Journal of Commerce and Management Perspective 3 (1), 1-14
Basel Committee on Banking Supervision, (1998) Risk Management for Electronic Banking and Electronic
Money Activities. Journal of Small Business Management. 4(2), 51-840.
Basel Committee on Banking Supervision, (2003) Risk Management Principles for Electronic Banking.
Bank for International Settlement. Journal of Business. 18 (5), 93-147.
Berenson, M. (2006) Basic business statistics: concepts and applications (12th ed.) London: Pearson.
Blazi, C. & Awolusi, O.D. (2020), “Employee Engagement in Multinational Diverse Organization in
Difficult Terrain: A Study of Non-Family Station Organization”, Information Management and Business Review, 12 (1), 45-62
Blumberg, B., Cooper, D. R. & Schindler, P. S. (2005) Business Research Methods. Berkshire: McGraw-Hill
Chakrabartty, S. N. (2013) Best Split-Half and Maximum Reliability. IOSR Journal of Research & Method
in Education. 3(1), 1-8.
Cheng, T.C., Lam, Y.C. & Yeung, C.L. (2006) Adoption of internet banking: An empirical study in Hong
Kong. Decision Support Systems, 42(3), 1558-1572.
Cohen, L., Manion, L. & Morrison, K. (2007) Research methods in education (6th ed.) New York, USA:
Collins, J. (2001) Level 5 leadership: The Triumph of Humility and Fierce Resolve. Harvard Business
Review, 83 (7-8), 136-146.
Cook, D. A. & Beckman, T. J. (2006) Current Concepts in Validity and Reliability for Psychometric
Instruments: Theory and Application. The American Journal of Medicine. 119(1), 166.e7-166.e16.
Coombs, C. H. (1987). The structure of conflict. American Psychologist. 42(4), 355-363.
Cooper, D.R. & Schindler, P.S. (2011) Business Research Methods (9th ed.) McGraw Hill.
Creswell, R. (2014) Research Design: Qualitative, Quantitative, and Mixed Methods Approaches. USA:
Crotty, M. (1998) The foundations of social research. London: Sage.
Davis, F. D., Bogozzi, R. P., & Warshaw, P. R. (1989). User acceptance of computer technology: A
comparison of two theoretical models. Management Science. 35(1), 982-1003.
Davis, F. D. (1989) Perceived usefulness, perceived ease of use, and user acceptance of information
technology. MIS Quarterly. 13(3), 319-340.
Devi, J.T., Pudaruth, S., & Ramdin, P. (2012) Factors influencing the adoption of internet banking: a case
study of commercial banks in Mauritius. World Journal of Science, Technology and Sustainable Development. 9(3), 204-234.
Downing, S. M. (2004) Reliability: On the Reproducibility of Assessment Data. Med Education. 38(1),
Easterby-Smith, M., Thorpe, R. & Jackson, P. (2012) Management Research (4th ed.). London: SAGE
Eccles, R. G. & Serafeim, G. (2013) The Performance Frontier: Innovating for a Sustainable
Strategy. Harvard Business Review, 1-10.
Farris, P.W., Bendle, N.T., Pfeifer, P.E., & Reibstein, D.J. (2010) Marketing Metrics: The Definitive Guide
to Measuring Marketing Performance (2nd ed.), Pearson Education, Upper Saddle River, New Jersey.
Fishbein, M., & 0Ajzen, I. (1975) Belief, attitude, intention, and behavior: An introduction to theory and
research. Reading, Mass; Don Mills, Ontario: Addison-Wesley Pub. Co.
Grix, J. (2004) The Foundations of Research. London: Palgrave Macmillan.
Harihara, S. R., & Pavithra, V. (2012) A Study on Customer Perception and Awareness in the Usage of
Internet Banking. International Conference on Strategic trends on Innovations and Creativity on Management Practices. Available at: http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2187245 (Accessed: 07/04/18).
Hernando, I., & Nieto, M. (2006) Is the Internet Delivery Channel Changing Banks’ Performance? The Case
of Spanish Banks. Banco de Espana Research Paper No. WP-0624.
Hong, S.J., Thong, J.Y.L., & Tam, K.Y. (2006) Understanding Continued Information Technology Usage
Behavior: A Comparison of Three Models in the Context of Mobile Internet. Decision Support Systems. 42(3), 1819-1834.
Jayawardhena, C. & Foley, P. (2000) Changes in the banking sector -The case of Internet banking in the UK.
Internet Research, 10(1), 19-30
Johnson, S. (2014) Advantages and Disadvantages of Positivism. Available at:
Kadzo, S. & Wafula, M.K. (2015) Effects of Internet banking on the Financial Performance of Commercial
Banks in Kenya (A Case of Kenya Commercial Bank). International Journal of Scientific and Research Publications. 5(5), 9-20.
Kaur, R. (2013) The Impact of Electronic Banking on Banking Transactions: A Cost-Benefit Analysis. IUP
Journal of Bank Management. 12(2), 62-71.
Kimberlin, C. L. & Winterstein, A. G. (2008) Validity and Reliability of Measurement Instruments Used in
Research. American Journal of Health-System Pharmacists. 65(1), 2276- 2284.
Kricks, T. (2009) CARTA & Caribbean Group of Banking Supervisors. IT Workshop for Regional Bank
Examiners. International Journal of Small Business Management. 4(10), 51-84.
Kolodinsky, J.M. & Hogarth, J.M. (2004) The adoption of electronic banking technologies by US
consumers. The International Journal of Bank Marketing. 22(4), 238-259.
Lai, P. C. (2016) Design and Security impact on consumers’ intention to use single platform E-payment.
Interdisciplinary Information Sciences. 22(1), 111-122.
LeBeouf, M. (1987). How to Win Customers and Keep them for Life. Berkley Publishing Group, New York
Lee, G. & Lin, H. (2005) Customer’s perception of e-service quality in online shopping. International
Journal of Retail and Distribution Management. 33(2), 316-322.
Liu, Y., Li, H. & Carlsson, C. (2010) Factors driving the adoption of m. learning: An empirical study.
Computers and Education. 55(3), 1211 – 1219.
Ma, Z. (2012) Factors affecting the customer satisfaction of internet banking: An Empirical study in China.
Journal of Convergence Information Technology, 7(3), 101-109.
Madan, C. R. & Kensinger, E. A. (2017) Test–Retest Reliability of Brain Morphology Estimates. Brain
Informatics. 4(1), 107–121.
Matira, K.M. & Awolusi, O.D. (2020), “Leaders and Managers Styles towards Employee Centricity:
A Study of Hospitality Industry in United Arab Emirates”, Information Management and Business Review, 12 (1), 1-21
Mawutor, J. K. M. (2014) Impact of E-Banking on the Profitability of Banks in Ghana. Research Journal of
Finance and Accounting. 5(22), 53-63.
Morris, E. & Burkett, K. (2011) Mixed Methodologies: A New Research Paradigm or Enhanced Quantitative
Paradigm. Online Journal of Cultural Competence in Nursing and
Healthcare. 1(1), 27-36.
Mukonga, L.M. & Awolusi, O.D. (2019), “Strategic Leadership in Post-Conflict States: A Study of the
Democratic Republic of Congo (DRC)”, Journal of Social and Development Sciences, 10 (4), 36-51
Ngai, L.W.T, Poon, J.K.L. & Chan, Y.H.C. (2007) Empirical examination of the adoption of WebCT using
TAM. Computers and Education. 48(2), 250 – 267.
Njogu, J. N. (2014) The effect of Electronic Banking on Profitability of Commercials in Kenya. A Research
Project Submitted in Partial Fulfilment of The Requirements for The Award of The Degree of Master of Science in Finance, School of Business, University of Nairobi. Available at: http://chss.uonbi.ac.ke/sites/default/files/chss/NJOGU%20JOSEPH%20NJOGU.pdf (Accessed:05/05/18).
Olatunji, O.O. & Awolusi, O.D. (2019), “Performance Evaluation and Improvement among Salesmen in
the Nigerian Fast Moving Consumer Goods Sector”, Journal of Social and Development Sciences, 10 (4), 12-29
Oliver, V. (2010) 301 Smart Answers to Tough Business Etiquette Questions. Skyhorse
Publishing: New York, USA.
Onikoyi, I.A., Babafemi, E.A. and Awolusi, O.D. (2013), “Biblical and Societal appraisal of divorce
amongst Christians”, Babcock Journal of Management and Social Sciences 2 (1), 72-90
Ovidiu, S. & Alina, S. (2015) The impact of internet banking on performance of Romanian banks: DEA and
Pitt, M. & Koufopoulos, D.N. (2012) Essentials of Strategic Management. London: Sage
Rad, H.S., Rasoulian, A., Mirzaei, M. & Sharifipour, A. (2017) Electronic Banking; a New Strategy to
Create Customers’ Loyalty to Investment and Its Impact on Economic Initiatives. International Journal of Management, Accounting and Economics. 4(4), 431-442.
Rauf, H. (2014) Trends in China’s E-commerce Market. Available at:
http://www.china-briefing.com/news/2014/06/04/trends-chinas-e-commerce-market.html (Accessed: 23/09/18).
Reeves, M., Love, C. & Tillmanns, P. (2012) Your Strategy Needs a Strategy. Harvard Business Review,
Robson, C. (2011) Real World Research: A Resource for Users of Social Research Methods in Applied
Settings, (2nd ed.). Sussex, A. John Wiley and Sons Ltd.
Salawu, R.O. & Salawu, M.K. (2007) The Emergence of Internet Banking in Nigeria: An Appraisal.
Information Technology Journal. 6(4), 490-496.
Salehi, M. & Alipour, M. (2010) E-banking in emerging economy: Empirical evidence of Iran. International
Journal of Economics and Finance. 2(1), 201-209.
Saunders, M., Lewis, P. & Thornhill, A. (2009) Research Methods for Business Students, (5th ed.). Harlow,
Shekharan, U. & Bougie, R. (2010) Research Methods for Business: A Skill Building Approach (5th ed.).
New Delhi: John Wiley.
Simpson, J. (2002) The Impact of the Internet in Banking: Observations and Evidence from Developed and
Emerging Markets. International Journal of Telematics and Informatics, 19(1), 315-330.
Singh, A. S. (2014) Conducting Case Study Research in Non-Profit Organizations. Qualitative Market
Research: An International Journal.17(1), 77–84.
Singh, J. & Kour, G. (2011) Customer satisfaction and universal banks: An empirical study. International
Journal of Commerce and Management. 21(4), 327-348.
Shih, Y.Y. & Fang, K. (2004) The use of a Decomposed Theory of Planned Behavior to study Internet
banking in Taiwan. Internet Research.14 (3), 213-223.
Sumra, S. H., Manzoor, M. K., Sumra, H. H. & Abbas, M. (2011) The Impact of E-Banking on the
Profitability of Banks: A Study of Pakistani Banks. Journal of Public Administration and Governance, 23(2), 23-34
Thatcher, R. (2010) Validity and Reliability of Quantitative Electroencephalography. Journal of
Neurotherapy. 14(1), 122-152.
Twycross, A. & Shields, L. (2004) Validity and Reliability-What’s it All About? Part 2: Reliability in
Quantitative Studies. Paediatric Nursing. 16 (10), 23-36
Wang, D. H., Claire, L., Kenneth, B. Y. & Randell, B. (2009) To trust or not to trust: The consumers
dilemma with e-banking. Journal of Internet Business. 6(2), 1-27.
Worku, G., Tilahun, A.I. & Tafa, M.A. (2016) The Impact of Electronic Banking on Customers’ Satisfaction
in Ethiopian Banking Industry (The Case of Customers of Dashen and Wogagen Banks in Gondar City). Journal of Business & Financial Affairs. 5(2), 1-18.
Yang, J., Cheng, L. & Luo, X. (2009) A comparative study on e-banking services between China and USA.
International Journal of Electronic Finance. 3(3), 235-252.
Yang, S., Li, Z., Ma, Y. & Chen, X. (2018) Does Electronic Banking Really Improve Bank Performance?
Evidence in China. International Journal of Economics and Finance.10 (2), 82-94.
Copyright (c) 2020 Uchenna Aduaka, Olawumi Dele Awolusi
This work is licensed under a Creative Commons Attribution 4.0 International License.
Author (s) should affirm that the material has not been published previously. It has not been submitted and it is not under consideration by any other journal. At the same time author (s) need to execute a publication permission agreement to assume the responsibility of the submitted content and any omissions and errors therein. After submission of revised paper in the light of suggestions of the reviewers, the editorial team edits and formats manuscripts to bring uniformity and standardization in published material.
This work will be licensed under Creative Commons Attribution 4.0 International (CC BY 4.0) and under condition of the license, users are free to read, copy, remix, transform, redistribute, download, print, search or link to the full texts of articles and even build upon their work as long as they credit the author for the original work. Moreover, as per journal policy author (s) hold and retain copyrights without any restrictions.