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Electronic Banking and Bank Macro-Performance: Implication for Accounting Education in Nigeria

Michael, Saro S., PhD, Thomas, Bariere, PhD, Ikole Dornubari, PhD

Abstract

This study evaluates the effect of electronic banking on bank performance in Nigeria using secondary data and an Auto-Regressive Distributed Lag framework. The analysis covers 2009–2023 and models banks’ contribution to GDP as a function of four e-banking channels: ATMs, mobile banking, internet banking and POS, using logged transaction series to ensure comparability. Empirical results show a stable long-run relationship: ATM and internet banking exert positive and statistically significant long-run effects on BKGDP, POS displays a positive but statistically weak effect, while mobile banking is associated with a negative long-run coefficient. The error-correction term is negative and highly significant, indicating rapid adjustment to long-run equilibrium aftershocks. Findings suggest channel-specific dynamics: ATMs and internet platforms enhance bank output, mobile channels may compress margins or reflect transitional costs, and POS benefits are conditional on merchant adoption and settlement practices. Policy recommendations include optimizing ATM networks, strengthening fraud controls and pricing for mobile services, investing in secure internet platforms, and incentivizing POS uptake. The study concludes that electronic banking influences bank performance heterogeneously and calls for not just targeted managerial and regulatory actions, but also to maximize net benefits through proper education.

Keywords

Electronic BankingBank PerformanceAuto Regressive Distributed LagBank contribution to GDPand Transaction channels

References

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