Effect of e-banking on organizational productivity(a case study of fidelity bank)

Thesis Overview

<p> </p><p>INTRODUCTION</p><p><b>1.1. &nbsp; &nbsp;</b><b>Background of the study</b></p><p><b></b></p><b><p>Mobile<br>banking is an innovation that has progressively rendered itself in pervasive<br>ways cutting across several financial institutions and other sectors of the<br>economy. During the 21st century mobile banking advanced from providing mere<br>text messaging services to that of pseudo internet banking where customers<br>could not only view their balances and set up multiple types of alerts but also<br>transact activities such as fund transfers, redeem loyalty coupons, deposit<br>cheques via the mobile phone and instruct payroll based transactions(Vaidya<br>2011). The world has also become increasingly addicted to doing business in the<br>cyber space, across the internet and World Wide Web. Internet commerce in its<br>own respect has expanded in various innovative forms of money, and based on<br>digital data issued by private market actors, has in one way or another<br>substituted for state sanctioned bank notes and checking accounts as customary<br>means of payments (Cohen 2001). Technology has greatly advanced playing a major<br>role in improving the standards of service delivery in the financial<br>institution sector. Days are long gone when customers would queue in the<br>banking halls waiting to pay their utility bills, school fees or any other<br>financial transactions. They can now do this at their convenience by using<br>their ATM cards or over the internet from the comfort of their homes.<br>Additionally due to the tremendous growth of the mobile phone industry most<br>financial institutions have ventured into the untapped opportunity and have<br>partnered with mobile phone network providers to offer banking services to<br>their clients. ATM banking is one of the earliest and widely adopted retail<br>e-banking services in Nigeria (Nyangosi et al. 2009). However according to an<br>annual report by Central Bank of Nigeria its adoption and usage has been<br>surpassed by mobile banking in the last few years (CBK 2008). The suggested<br>reason for this is that many low income earners now have access to mobile<br>phones. A positive aspect of mobile phones is that mobile networks are available<br>in remote areas at a low cost. The poor often have greater familiarity and<br>trust in mobile phone companies than with normal financial institutions.</p><p><b>1.2. &nbsp; &nbsp;</b><b>Statement of the general problem</b></p><p><b></b></p><b><p>A<br>fundamental assumption of most recent research in operations improvement and<br>operations learning has been that technological innovation has a direct bearing<br>on performance improvement (Upton and Kim, 1999). Strategic management in<br>financial institutions demand that they should have effective systems in place<br>to counter unpredictableevents that can sustain their operations while<br>minimizing the risks involved through technological innovations. Only financial<br>institutions that are able to adapt to their changing environment and adopt new<br>ideas and business methods have guaranteed survival. Some of the forces of<br>change which have impacted the performance of financial institutions mainly<br>include technological advancements such as use of mobile phones and the<br>internet. Since the beginning of e-banking Nigerian financial institutions have<br>witnessed many changes. Customers now have access to fast, efficient and<br>convenient banking services. Most financial institutions in Nigeria are<br>investing large sums on money in information and communication technology<br>(ICT). However while the rapid development of ICT has made some banking tasks<br>more efficient and cheaper, technological advancements have their fair share of<br>problems; for example they take a large share of bank resources, plastic card<br>fraud particularly on lost and stolen cards and counterfeit card fraud. Thus<br>there is a need to manage costs and risks associated with internet banking. It<br>is crucial that internet banking innovations be made through sound analysis of<br>risks and costs associated to avoid harm on banks performance. Bank performance<br>is directly dependent on efficiency and effectiveness of internet banking and<br>on the other hand tight controls in standards to prevent losses associated with<br>internet banking. In order not to impair on their prosperity, financial<br>institutions need to strike a balance between tight controls and standards in<br>efficiency of internet banking. This is only possible if the effects of<br>internet banking on financial institutions and its customers are well analyzed<br>and understood. Mobile money has emerged as a strong competition to financial<br>institutions in Nigeria. Initially cellular phones were developed to improve<br>communication from the earlier primitive forms of communications such as smoke<br>and drums. Financial institutions introduced ICT as an improvement to the<br>banking channels. This has thus enabled bank customers’ access information<br>relating to their accounts, (Tiwari, Buse and Herstatt, 2007.). In this regard<br>mobile phone service providers have taken mobile money services deeper into the<br>financial sector by offering a range of financial services through their<br>networks.</p><p><b>1.3. &nbsp; &nbsp;</b><b>Objectives of the study</b></p><p><b></b></p><b><p>The<br>following would be the aims and objectives of this study</p><p>1. To<br>examine the impact of internet banking on organizational productivity.</p><p>2. To<br>examine the extent to which organizations in Nigeria make use of internet<br>banking.</p><p>3. To<br>recommend better ways of improving internet banking in Nigeria.</p><p><b>1.4. &nbsp; &nbsp;</b><b>Research Questions</b></p><p><b></b></p><b><p>1. What<br>is the impact of internet banking on organizational productivity?</p><p>2. What<br>is the extent to which organizations in Nigeria make use of internet banking?</p><p><b>1.5. &nbsp; &nbsp;</b><b>Research hypothesis</b></p><p><b></b></p><b><p>H0:<br>internet banking does not influence organizational productivity</p><p>H1:<br>internet banking influences organizational productivity</p><p><b>1.6. &nbsp; &nbsp;</b><b>Significance of the study</b></p><p><b></b></p><b><p>The<br>study will be crucial to emerging financial institutions as it will provide<br>answers to the factors against the implementation of internet banking in<br>Nigeria, prove of the success and growth associated with the implementation of<br>internet banking and highlight the areas of banking operations that can be<br>enhanced via internet banking. It is equally significant for bank executives<br>and indeed the policy makers of the banks and financial institutions to be<br>aware of internet banking as a product of internet commerce with a view to<br>making strategic decisions. The study is also expected to give an insight on<br>the state of mobile money services as a competition to the commercial banks in<br>Nigeria and the factors that have greatly influenced its growth. Players in the<br>financial institution sector and telecommunications industry will find the<br>study useful as they can use the findings to strategize on how they can<br>mutually benefit from this development. Finally, our study adds to the existing<br>literature, and is a valuable tool for students, academicians, institutions,<br>corporate managers and individuals who want to learn more about mobile and<br>internet banking.</p><p><b>1.7. &nbsp; &nbsp;</b><b>Scope and limitations of the<br>study</b></p><p><b></b></p><b><p>This<br>study is restricted to the impact of internet banking on organizational productivity.</p><p><b>Limitation of the study</b></p><p><b></b></p><b><p><b>Financial constraint</b>– Insufficient fund tends to impede the efficiency of the<br>researcher in sourcing for the relevant materials, literature or information<br>and in the process of data collection (internet, questionnaire and interview).<b></b></p><b><p><b></b></p><b><p><b>Time<br>constraint</b>– The<br>researcher will simultaneously engage in this study with other academic work.<br>This consequently will cut down on the time devoted for the research work.</p><p><b>REFERENCE</b></p><p><b></b></p><b><p>Freedman, C. 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