Impact of Electronic Banking on Deposit Money Banks Performance in Nigeria: Evidence from Dynamic Ordinary Least Squares Technique
Obumneke Ezie
Department of Economics, Bingham University, Karu, Nigeria.
Irimiya Christabel Musa
Department of Economics, Bingham University, Karu, Nigeria.
Jeremiah Dandaura Joshua *
Department of Economics, Bingham University, Karu, Nigeria.
*Author to whom correspondence should be addressed.
Abstract
The importance of electronic banking and its performance can never be overemphasized and technology industries made it effective and efficient in carrying out transactions on a daily basis. On this note, the paper investigated the empirical effect of electronic banking on bank performance in Nigeria from 2009Q1 to 2023Q1. The paper adopted Dynamic Ordinary Least Squares (DOLS) technique and the variables include the dependent variable, return on assets (ROA) while the independent variables include point of sales (POS) and cheque (CHQS). The coefficient of the total number of point of sales transactions (POS) coefficient is directly related to electronic banking on bank performance long-run in Nigeria. The result reveals that there is a statistical and positive effect of electronic banking on bank performance on the return of assets (ROA) in Nigeria. On the other hand, the coefficient of total transactions carried out on the cheques (CHQS) is positively related to electronic banking on bank performance captured by return on assets (ROA). It means a rise in total transactions carried out on the cheques exerts a positive impact on e-banking on bank performance in Nigeria. The paper recommended that government or financial institutions should deploy the right technology that would model the digital global market and banking sector and that banks should encourage the consumers‟ of electronic ways of banking. On the aspect of cheques, therefore, there is a need to develop effective strategies for customers to shift from traditional to electronic banking and discourage the use of cheques.
Keywords: Electronic banking, bank performance, return on assets, DOLS
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