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Impact of ICT and related problems on online banking in Nigerian Banks

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The recent and emerging development in today’s technology has driven the business trend to adopt these technologies to improve productivity, expandability, performance, innovation and all aspects that increase prosperity ongoing development of new sources of income while decreasing the costs. Banks are one of the major players of today’s business developments, which adopt ICT in their daily activities. This Study employed quantitative approach using an online survey of questionnaires and respondents to collect information on ICT related problems on online banking in Nigerian Banks. SPSS was also made use of in the analysis. The study revealed that ICT related a problem on online Banking has an impact on banks. We try to get insight of the major factors affecting the business of banks as an impact of adopting ICT and study the problems surrounding the use of ICT that impact the usage on online banking services in Nigerian banks.


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  • 1. Assessment of the impact of Information and Communication Technology (ICT) and related problems on Online Banking in Nigerian Banks Prepared By Taufiq Hail Ghilan Al-Madhagy email:towfeeq2k5@yahoo.com Contribution of the following Emad M. Muftah akash Salam Denen Damian Nyakuma Page 1 of 45
  • 2. Table of Contents Abstract ..................................................................................................................... 5 Introduction ............................................................................................................... 6 Research Problem ...................................................................................................... 7 Research Objective .................................................................................................... 7 Objectives of the Study .............................................................................................. 7 Research Questions ................................................................................................... 8 Chapter One Introduction .......................................................................................... 8 Significance of Study................................................................................................. 8 Scope of Research ..................................................................................................... 8 Organization of the Thesis ......................................................................................... 9 1. Literature Review ......................................................................................... 9 .2 Historical Background on Nigerian Banks........................................................ 9 3. ICT in Bank industry in Nigeria ................................................................. 11 a. Global Systems for Mobile Communication (GSM) ............................. 12 b. Internet Banking ................................................................................... 12 c. Automated Teller Machines (ATM) ..................................................... 13 d. Telephone banking technology ............................................................. 13 e. Adoption of ICT integrated project ...................................................... 13 f. E-mail .................................................................................................. 13 g. Banker Automated Clearing Services ................................................... 14 Theoretical Framework ............................................................................................ 14 1. User characteristics..................................................................................... 14 2. Usage of Internet Banking (IB) ................................................................... 15 3. Security Concerns ...................................................................................... 16 4. Intermittent Services Concern..................................................................... 16 Chapter Three Research Methodology ..................................................................... 17 Page 2 of 45
  • 3. 1. Sampling Design ........................................................................................ 17 2. Instrumentation .......................................................................................... 18 3. Data Collection........................................................................................... 19 4. Data Analysis ............................................................................................. 19 5. Limitation and Delimitation........................................................................ 19 Results and discussion ............................................................................................. 20 1. The respondents’ demographic and User Characteristics............................. 20 2. Usefulness (M) ........................................................................................... 23 3. Ease of Use (IV) ......................................................................................... 25 4. Intermittent Services Concerns (IV)............................................................ 27 5. Security Concerns (IV) ............................................................................... 30 Conclusion .............................................................................................................. 33 Reference ................................................................................................................ 34 Appendix ................................................................................................................. 37 Table 1 ........................................................................................................................................................... 15 Table 2 ........................................................................................................................................................... 23 Table 3 ........................................................................................................................................................... 25 Table 4 ........................................................................................................................................................... 27 Table 5 ........................................................................................................................................................... 30 Table 6 ........................................................................................................................................................... 33 Figure 1 Theoretical Framework .................................................................................................................... 14 Figure 2 .......................................................................................................................................................... 37 Figure 3 .......................................................................................................................................................... 37 Figure 4 .......................................................................................................................................................... 38 Figure 5 .......................................................................................................................................................... 38 Figure 6 .......................................................................................................................................................... 38 Figure 7 .......................................................................................................................................................... 39 Figure 8 .......................................................................................................................................................... 39 Figure 9 .......................................................................................................................................................... 39 Page 3 of 45
  • 4. Figure 10 ........................................................................................................................................................ 40 Figure 11 ........................................................................................................................................................ 40 Figure 12 ........................................................................................................................................................ 40 Figure 13 ........................................................................................................................................................ 41 Figure 14 ........................................................................................................................................................ 41 Figure 15 ........................................................................................................................................................ 41 Figure 16 ........................................................................................................................................................ 41 Figure 17 ........................................................................................................................................................ 42 Figure 18 ........................................................................................................................................................ 42 Figure 19 ........................................................................................................................................................ 42 Figure 20 ........................................................................................................................................................ 43 Figure 21 ........................................................................................................................................................ 43 Figure 22 ........................................................................................................................................................ 43 Figure 23 ........................................................................................................................................................ 44 Figure 24 ........................................................................................................................................................ 44 Figure 25 ........................................................................................................................................................ 44 Figure 26 ........................................................................................................................................................ 45 Figure 27 ........................................................................................................................................................ 45 Page 4 of 45
  • 5. Assessment of the impact of Information and Communication Technology (ICT) and related problems on Online Banking in Nigerian Banks Abstract The recent and emerging development in today’s technology has driven the business trend to adopt these technologies to improve productivity, expandability, performance, innovation and all aspects that increase prosperity ongoing development of new sources of income while decreasing the costs. Banks are one of the major players of today’s business developments, which adopt ICT in their daily activities. This Study employed quantitative approach using an online survey of questionnaires and respondents to collect information on ICT related problems on online banking in Nigerian Banks. SPSS was also made use of in the analysis. The study revealed that ICT related a problem on online Banking has an impact on banks. We try to get insight of the major factors affecting the business of banks as an impact of adopting ICT and study the problems surrounding the use of ICT that impact the usage on online banking services in Nigerian banks. Page 5 of 45
  • 6. Introduction The emerging and fast growing advancement in communication and information technology have led to changing behavior of business operations on daily bases. Banks are one of the major sectors of business that adopted ICT and changed the nature of banking conventional activities. The internet banking is now a must to adopt for banks in the developing countries and it is observed that a wave of change in many developing, and specifically the African, countries have adopted these technologies to follow the queue of the advanced developed countries in this vital sector of business. Customers can now transfer money, access their accounts, online shopping, get bank statement, pay their bills, and conduct other transactions that took a long time of process in the past. Adopting ICT has brought a lot of success stories, saved cost, brought efficiency and convenience to customers as in (Cheng, Lam &Yeung, 2006). Surveys conducted in the U.S during the period of 2008-2009 shows that there isn’t a rapid increase of the users using internet banking as perceived according to the fast growing number of users using the internet (Cheng, Lam &Yeung, 2006; eMarketer,2012; Forrester Research, 2011). In spite of the users of online bank services that are using these services and enjoying the convenience, they show a great concern of leakage of their financial information and related security issues. According to a study performed by (Edwards, 2010) showed that 51.2% of U.S. consumers and 60.3% of Canadian online users do not trust the security of mobile banking. On the other hand, the category that do not use online and do not trust the Internet banking services are 21.7% of U.S. and 26.2% of Canadians. Furthermore, all categories, that trust and use or the others not adopting online services or not trusting, trust the branch or physical banks with 84%. As a result of these security concerns, many are reluctant to use these facilities provided by banks(Cheng, Lam &Yeung ,Yeung, 2006); eMarketer, 2012; Edwards, 2010). In addition to the security issues related to the impact of ICT usage by customer, the intermittent services in Nigeria are another major factor that the adopters, of ICT facilities in banks, suffer from and have a big concern in using such services. We noticed that there is a great gap between adopting ICT and the issues that impact the usage and popularity of online banking using ICT. For these reasons, the aim of our study is to investigate the factors that have negative Page 6 of 45
  • 7. impacts on online banking in Nigerian banks but focusing on the security and intermittent service concerns. Research Problem The ICT on banking sector has been implemented in Nigeria since the reform of banking sector in 2004. The migration and integration on small sized banks to become larger ones has taken place and lots of developments on the operation of banks has benefited from the ICT in regard to profitability, usability, performance, expansion, and many other benefits. On the other hand, implementing ICT has suffered from intermitting services and lack of trust from wide sector of populace to adopt online services due to security issue concerns. The gap between using ICT and problems surrounding the obstacles of security and intermittent services has affected the bank industry and limited the raise of number of online users in Nigeria. This gave motivation for our study to look for the reasons of intermittent services and impact of security issues on the usage of online banking services in Nigerian banks. Research Objective Objectives of the Study The broad objective of this study is to identify Information and Communication Technology related problems on the usage of online banking services in Nigerian banks security and intermittent services effects on it. The specific objectives of the study are; 1. To determine the extent of ICT related factors influencing the usage of online banking services. 2. To test the influence of security concerns that clients have on the usage of online banking services. 3. To measure the impact of intermittent services on the online banking usage. 4. To gain insight of the impact of level of education on the usage of online banking. 5. To ascertain the contributions of ICT application process in banking usage, popularity, and performance. 6. To determine if ICT has improved the service delivery to clients in Nigerian banks and gained their support in utilizing the innovative e-services. 7. To determine if ICT improved the services rendered by Nigerian banks. 8. To obtain insight if ICT has an effect of the application of ICT in banking services. Page 7 of 45
  • 8. Research Questions In the light of the preceding objectives, the study seeks to answer the following questions. 1. What is the extent of ICT problems influencing the usage of online banking services? 2. What are the factors influencing the usage of online banking services? 3. How do security concerns affect the online banking services usage? 4. Does the intermittent service have an impact on the online banking services? 5. What extent does ICT related problems influence bank performance? 6. Does the level of education have an impact on the online banking usage? 7. What are the contributions of ICT application process to bank performance? 8. Did ICT improved the service delivery to Nigerian banks’ clients and gained their support in utilizing the innovative e-services? 9. Has ICT improved the services rendered by Nigerian banks? Chapter One Introduction Significance of Study It is hoped that the outcome of this study will add up, or in other words, contribute to existing studies especially with regards to the impact of ICT and related problems on online banking as well as barriers and challenges encountered through their transition to adopting ICT. Scope of Research The banking industry in the whole world is on a wheel of change the covered all aspects of bank business and changed the traditional way of bank operations. The African countries have, in the last decade, made a jump in the reform and usage of ICT and Nigeria is one of the major players in banking industry in Africa. Thus, in this study, we focused on the effects and impacts of the ICT usage and the problems related to it in the bank sector in Nigeria. Page 8 of 45
  • 9. Organization of the Thesis 1. Literature Review A survey was conducted by (Agbola, 2001) on six major banks that had been operational for longtime, had built a wealthy experience in banking industry, had fast growth, and high level of technology adoption in their operations. A questionnaire developed to grab the customer satisfaction or not on services provided by banks. The study has revealed that there are number of problems associated with banking automation on customers. The frequent system breakdown, black-out/power failure, lack of cordial interaction with staff, and posting errors and manipulation of figures are the major issues under focus. The findings shows that 46% of the respondents indicate that frequent system break down is the on the first degree of concern which can cause to loss of customer’s data and hinder them from withdrawing the urgent cash they needed. The second in position is the power failure 29.7% which causes accessing the customer accounts impossible and leads to huge losses in addition to inconvenient atmosphere for the customers to remain in banks in very hot climate (Agboola, 2001) 2. Historical Background on Nigerian Banks Formal banking is a relatively old economic activity in Nigeria, dating back to before the emergence of the country itself as a distinct nation. While Nigeria emerged as a distinct country in 1914 with the merger of the Northern and Southern Protectorates with the Colony of Lagos, the first bank in the country was established in 1892. However, the industry at this time and for some time after was largely unregulated and thus many instability and bank failures characterized the system. However, with political independence looming in the 1950s, the government took control of the regulation of the industry bringing stability back into the sector. This remained the situation until the late 1980s when the deregulation of the economy that accompanied the Structural Adjustment Programme the country embarked upon brought the sector back into public focus. The Nigerian banking industry is regulated by the Central Bank of Nigeria (CBN). The Nigerian banking sector has since undergone considerable reforms over the last 25 years. Financial deregulation and economic liberalization policy of the 1980s changed the structure of the sector from an oligopolistic, financially repressive, and highly regulated sector to one that is deregulated and highly competitive. In 1980, there were 20 commercial banks and 6 merchant banks in Nigeria with a network of 740 and 12 branches respectively. This rose to Page 9 of 45
  • 10. 30 commercial and 12 merchant banks in 1986 with 1,367 and 65 branches respectively, and in 1991 there were 65 commercial and 54 merchant banks with 2023 and 84 branches respectively. In the mid 90’s there was a depression that occurred in the financial system which reduced the number to 51 commercial and 38 merchant banks in 1999 (Tella, 2006). Further reform of the system in the late 1990s saw the removal of the commercial/ merchant bank dichotomy in favor of the adoption of the term Universal bank. By the early 2000, therefore there were 89 Universal banks in Nigeria. Another reform in the sector occurred in 2004 / 2005 this brought the sector back under greater regulation principally in the form of a huge increase in the regulatory capital requirement from one billion Naira to twenty five billion Naira. This gave birth to a spate of merger and consolidation agreements among the ICT’s Service & Operational Performance in Nigerian Banks... firms in the industry reducing the number of the Universal banks to 25. Another round of reform of the sector was commenced in 2010. This involved government bailout of five of the firms in the banking industry and restructuring of the top management of the affected banks. These were aimed at improving corporate governance and removing some structural deficiencies perceived to be inherent in the industry and which pose significant threat to the survival of many of the firms in the industry. From inception up to the period of deregulation, the operation of the banks in Nigeria were characterized by paper oriented methods rather than technological based system with attendant slowdown in pace of operation, employee productivity and general performance (Osabuohein, 2008). Hence, before the deregulation of the economy that took place in the 1980s, the use of ICT in the Nigerian banking system was limited. However, Idowu et al (2002) averred that Nigerian banks have since realized that the way in which they can gain competitive advantage over their competitors is through the use of technology, and this has engendered a growing rate of technology adoption in the Nigerian banking operations (Salawu and Salawu, 2007). Ehikhamenor (2003) noted that earlier desire for the use of ICT was characterized by long period of inertia largely attributable to the absence of an enabling policy and infrastructural environment. The decisive step in the incorporation of IT into banking operation in Nigeria actually started in 1999 being a consequence of stronger government Page 10 of 45
  • 11. commitment to the development of a national IT infrastructure. Banks not only became financiers of this initiative but also beneficiaries (Ehikhamenor, 2003). The formulation of a National Policy on Information Technology in 2001 created further awareness on the possibilities offered by IT and impacted positively on economic sectors with the banking sector as a pioneer. The Nigerian banking Industry underwent major changes, reflecting a number of underlying developments. Advancement in communication and information technology has facilitated growth in internet banking, ATM Network, Electronic transfer of funds and quick dissemination of information. In Nigeria, there are 22 commercial banks, 906 Micro-finance institutions, 5 discount houses, 5 development finance institutions, 731 bureau de change, 102 Primary Mortgage institutions, and 82 finance companies (Luka &Frank, 2012). The Nigerian bank is under structural reform and many changes took place in the field of information technology and communication. These reforms has led to heal the banking industry especially after issuing new regulation such as “the enactment of the Securitization Act to step up loan recoveries, establishment of asset reconstruction companies, initiatives on improving recoveries from Nonperforming Assets (NPAs) and change in the basis of income recognition has raised transparency and efficiency in the banking system .” (Luka & Frank, 2012). These reforms have pushed the banks to adopt ICT technologies that resulted spurt in treasury income and loan recoveries. It is worth mentioning that the central bank of Nigeria is the only entity to control and issue all regulations of the banking sector. 3. ICT in Bank industry in Nigeria The world of business has witnessed enormous changes in its nature due to the recent developments in ICT and the emerging technologies that appear frequently. The rapid changes in the business market and the hectic and fierce competition among companies have led to the adoption of new and innovative techniques in their business to gain trust and reap the benefits. The decrease in ICT gadgets has encouraged banks to increase ICT usage and the business environment is becoming more and more relying on ICT. Banks has taken the advantage of the technology developments in almost all aspects of its operations to increase productivity, profitability, and expandability especially in era of the sever competition in banking sector in the country. Page 11 of 45
  • 12. Continual operations around the clock are becoming feasible due to the recent developments in payment facilities because of innovative ICT gadgets adoption. Payment systems such as ATM, Electronic Fund Transfer (EFT), Clearing House Automated Payments (CHAPs), Electronic Purse (E-Purse), Automated Cheque Sorter (ACS), and Electronic and Transfer at Point of Sale(EFTPOS) has made the services much easier, faster, and at convenience for both customers and banks. In addition regulations in banks became more sophisticated and technology dependent and speeded up operations thus reducing the cost per unit in banking operations [5]. In some cases there are some shortcoming of the implementation of ICT in which bankers are unable to access their accounts or make transactions because of intermittent of network services or power failures. On the other hand, in the past times with the traditional banks operations, bankers has faced and struggled to cope with the long procedures and queues of people waiting for their inquiries to be fulfilled and their service to be delivered. The Nigerian banks have nowadays online services facilities aided to transfer funds instantly from any location and provided safer and at convenience facilities to bankers. The telephone banking technology is another innovative technology that improved the productivity, comfort, and innovative way to serve customers (Osabuohien, 2008). Nigerian society is the largest in Africa in the number of subscribers, 100,000 subscribers in 2000 and teledensity jumped from 2.55% in 1992 to 9.3% in 2004 [10,Ndukewe 2005], which helped banks to reap this advantage to market their products through the internet and encouraged them to benefit from its online services . a. Global Systems for Mobile Communication (GSM) GSM has a vital role in the improvement of banks operational efficiency. Through mobile phones, many clients can receive short messages services (sms) to get informed of the amounts deposited or withdrawn and balances up to last two transactions (Oluwatolani, Joshua &Philip, 2011). This saves a lot of time and effort not only for customers who were waiting in queues in banks but also it facilitates the efficiency operations of banks to serve more clients existing physically on banks. b. Internet Banking Home banking became a vital space for banks to expand its operations day and night on anywhere any time bases. Visa’s remote subsidiary become of a major player to connect Page 12 of 45
  • 13. banks in a secure channel for the safety of money transactions. The internet transactions required levels of security known as authentication, authorization, data integrity, and nonrepudiation as a key of four elements to provide security channel safer to use. Internet suppliers have to encrypt all transactions between them and the client on line to make decoding it complex to guess unless authorized (Agboola, 2001). This facility is very cheap, fast and in hand that needs only cost of internet connectivity and electricity (Agboola, 2001). c. Automated Teller Machines (ATM) ATMs are computer-based machines that are used to provide services for bank’s clients such as cash disposal, payment for electricity/telephone/water/internet bills, as well as give information about clients’ recent transfers or balances. In 1990, the first bank in Nigeria to launch this service was Societe Generale Bank in its Broad Street office with name Cash Point24 (Agboola, 2001). d. Telephone banking technology One way of witnessed technology advancements that were used is the telephone banking that enables the customers to call specific numbers to use this service. This technology uses voice activation technique and tone pad to enable customers to have transactions of accounts at their convenience (Osabuohien, 2008). e. Adoption of ICT integrated project This service has been completed successfully to provide services inside and outside the country. f. E-mail Electronic messaging has a great impact on the ease of communication between bank clients and other parties. This facility has taken a lion’s share of the ICT usage in the past decade and remains (Agboola, 2001). Page 13 of 45
  • 14. g. Banker Automated Clearing Services During the period of 1980, banks faced a huge growth of cheque usage in Nigeria as a result of fast strides in economic development. The clearance process faced significant delays an lea to commission Komplex Nigeria Limited to recommend means of document automation and it recommended Magnetic Ink Character Reader (MICR)(Agboola, 2001). It is a device used for cheque processing (encoding) in banks. It encodes, decodes, reads, and sorts cheques. Theoretical Framework Figure 1 Theoretical Framework Each construct is described below as follows. 1. User characteristics In our conducted study, we assumed that user characteristics have an influence on the online services usage. We considered the education as one item to test as we have a limited period to accomplish this study. We included three categories to test among respondents Page 14 of 45
  • 15. namely: Msc/PhD, Bsc/BA, OND/OCE, WASCE. We found that Msc/PhD has a 24% of the respondents, 23% for the Bsc/BA, and 8% for OND/OCE. We realized that the higher educated the person is, the more usage of the online banking he/she perform. The mean value of 3.39 is considered a moderate level score that gives us an indication that this factor is positively affects the online services. H1: The user characteristics based on the level of education is positively linked with Internet banking usage. Item Number Percentage Mean Value 3.39 Qualification • WASCE 0 0 • OND/OCE 4 8 • Bsc/BA 23 23 • Msc/PhD 24 24 Table 1 2. Usage of Internet Banking (IB) Banks' operations has developed in the last two decades rapidly and the traditional ways for dealing with customer banks have changed a lot. The employment of ICT in the daily operations of the banks changed the nature of business process and led to more advanced and easy to use ways to help and serve customers to fulfill their demands as soon as possible. The usage of ICT in banking operations facilitated so many services for the customer and bankers as well. It also cut the cost dramatically for the banks' operations, saved a lot of time for both the banks and customers, and lowered the transaction fees. These facilities can help beneficiaries to adopt internet banking. Davis in his article ( Davis, 1989) explained the technology use and technology acceptance attitudes through the Technology Acceptance Model (TAM) using two factors namely: the perceived usefulness and perceived ease of use. Studies Page 15 of 45
  • 16. such as (Agboola, 2001,Wang, Line, and Tang,2003) showed a positive effects on Internet banking use. on the other hand, some studies showed that perceived ease of use affects the perceived usefulness (Chang, and Rizal, 2010; Wang, Wang, Lin and Tang, ,2003).In this study, we have the deposit the following hypotheses. H2: A client's perceived ease of use is positively linked with perceived usefulness of Internet banking use. H3: A client's usefulness is positively linked with Internet banking use. 3. Security Concerns When it becomes to ICT devices and tools used in business, security issues surface and create a lot of disputes and concerns as well in business financial transactions. This issue has been the focus of many studies that covered the IT and electronictransactions (Howcroft, Hamilton and Hewer, 2002, Grabner-krauter & Faullant,2008;Lee, 2009; kim, Mirusmonov & Lee, 2010). Privacy and private financial information is of big concern for everyone. When using internet banking, people are mostly worried about this issue and has a big fear of theft over the internet especially when they read or hear about such incidents from media or friend. In this regard they have a negative perception on security issues concerning the internet banking (Lee, 2009; Sayar &Wolf, 2007). Thus we hypothesized the following: H4: A perceived security concern is negatively associated with Internet banking use. 4. Intermittent Services Concern As the development of the country's economic is shifting to more modern and to follow the western trend in business, the populace are more keen to use the new and innovative technological advances in business operations. The world has become a small village and the internet has shorten the distances between people thus the need for more reliable and rapid way to execute the financial transactions. Bank customers are continually facing intermittent services while performing their transactions or using online bank services. This issue causes a lot of inconvenience and annoyance especially when it is urgent to perform financial operations immediately and have already relay on that using the online services. It is sometimes shocking for the customers to have this Page 16 of 45
  • 17. situation which may cause considerable financial losses and lack of trust within business partners. The intermittent service maybe caused by power failure on site which hider clients to use ATM, or any other ICT gadgets, rapidly and efficiently. In addition, the intermittent services that is primarily caused by the telecom companies is another major issue that the bank sector is suffering from as there are no backup plans for the telecom companies to recover in fraction of seconds. That is another issue that makes clients hesitate and reluctant in using these innovative facilities that banks are providing as part of their shift toward the innovative international arena in banking sector. Furthermore, the clients may think to change to another bank if they get to know that others providing better services. So developing new innovative gadgets and procedures in banking sector is a key element to gain clients' satisfaction, loyalty, and trust. This change of client attitude led us to have the following hypotheses as follows: H5: A client's intermittent services concern is negatively associated with Internet banking use. Therefore, we propose the following hypothesis. H5:A client's intermittent services concern is negatively associated with Internet banking use. Chapter Three Research Methodology 1. Sampling Design In our study, we used a survey instrument and constructs were measured using Likert scale ranging from 1(Strongly disagree) to 5(Strongly agree), ordinal measurement using yes/no selection, and interval measurement using selection ranging from 1(Always) to 5(Never). The survey was supervised on 25 October until 4 November 2013 to groups of Nigerian academic students and residents in Malaysia, as they are actual beneficiaries of internet banking of Nigerian inside and outside the country. The number of participants is 51 in which we used online questionnaire, which is an easy to fill, applicable, fast, and convenient way to gather the information in one location. We used Google form for the purpose in which we find it practical and easy to be submitted to the respondents. The total number of respondents is 51 and the unit used is students in different Universities in Malaysia, lecturers, and residents. Page 17 of 45
  • 18. The percentages of respondent were calculated for each question, and then we categorized the questionnaire into groups covering each of our variables in this study. The mean value is used to give us the result of each variable. Graphical representation was attached at the appendix of each question in addition to the questions on the survey. Detailed information is presented to facilitate the analysis process in our analysis section. We used students as our unit of measurement based on a study conducted by (Ko, Mancha, Beebe, & Yoon) in which that justify their sample on students “ While using student subjects is often considered as a weakness of the study, these students reported themselves as the users of Internet banking, and, thus, we believe that they are suitable for our study.” (2012). Demographic characteristics of the respondents collected are presented in Tables below. 2. Instrumentation In this study we used the quantitative method using the survey method as an instrument. Online questionnaire was the tool used on this survey and was divided into two sections namely: section A, where the demographic profile and usage of electronic and online services were in question. The second section, section B, was divided into different parts with each part has different focus on the information that will be gained. Four questions focused on the perceived ease of use, four questions on perceived usefulness, and five questions on the perceived security issues, five on the perceived intermittent services and impart on the satisfaction of clients, and nice different questions for the demographic and general-purpose questions. Previous studies were the base of these questions in which we adopted to suite our purpose of this study. Previous studies such as (Cheng, Lam & Yeung, 2006; Ko, Mancha, Beebe & Yoon, 2012; Idowu, Alu, & Adagunodo, 2002) were the main source of the adopted questionnaire in this study. We modified the likert scale to include 5 point scale instead of 7 scale point ranging from strongly agree (1) to strongly disagree (5), and for the interval scale ranges from always (1) to never (5), in addition to ordinal questions that take the value of yes/no norm. We used for the analysis of the data the tools provided by the google tools in which excel format and other graphical illustrations depicts the results gained from the Page 18 of 45
  • 19. published questionnaire. We intend to make use statistical package for social sciences (SPSS) if the need arises and we have adequate time on our hands. 3. Data Collection In this study, we conducted a questionnaire survey for the purpose to get insight of the attitude of the respondents and find the real factors that affects or has an influence of the usage of online services and other ICT technologies implemented in banks in Nigeria. for that purpose, we created a questionnaire survey using Google online forms with all questions that we assumed important to support our estimates of the real problems on the banking industry in Nigeria. the Questionnaire is divided into two groups, section A and section B, and we tried to include all aspects to clarify the real reasons behind the usage, intention to use, and concerns of online services. The Google form provides an Excel sheet to give the details of the results and a graphical presentation of the results obtained. In addition, we gave 12 days of time for filling the questionnaire and used the e-mails or Facebook to spread out the questionnaire to all possible respondents. 4. Data Analysis In this study we conducted a questionnaire among Nigerian students and residents in Malaysia as they are clients in those banks in Nigeria and use the facilities that those banks offering for their clients. The questionnaire is an online tool that uses Google forms and provides graphical results and percentages of the results acquired. The factors that we are going to discuss are as in the following section. 5. Limitation and Delimitation There are limitations in this study that we are going to highlight. First, we conducted our study on a limited scope, Nigerian students and residents clients in Malaysia, of the population that are clients of the Nigerian banks. The justification for that we have taken into account that those are one important category of the Nigerian population and are studying abroad, thus the need for online services is a must for them. Also studies such as (Ko, MANCHA, BEEBE & SHIK YOON) indicated that “While using student subjects is often considered as a weakness of the study, these students reported themselves as the users of Internet banking, and, thus, we believe that they are suitable for our study." (2012). We based our questionnaire on these studies and conducted our research based on the previous studies in the field. The second limitation is the time limit in which hindered us from collecting more data on a large scale. The third limitation, in our opinion, is that we did not Page 19 of 45
  • 20. have the opportunity to spread this questionnaire to employees in banks in which their views will provide us with more precise data on the issues related with ICT usage and problems in their banks and on the impact of these problems in the productivity and popularity of the banks. Chapter Four Research Findings Results and discussion The number of respondents is 51 in which we divided them into groups consisting of the demographic characteristics, Usefulness, Ease of Use, Security concerns, and Intermittent Services. The TAM theory is our primary framework with some adoption by adding the Intermittent Services (IV) and Security Concerns (IV) as new independent variables. We calculate the percentage, the number of respondents, and the mean value of each question. We finally calculated the mean value for each variable based on the study conducted by (Alzaza andYaakub, 2011) in which they say “The ranges of five point Likert-scales were categorized into equal sized categories of low, moderate and high. Therefore, score of less than 2.33 are considered low; scores of 3.67 are considered high and those in between are considered moderate.” (2011). We, then, gained the final result of each hypothesis based on that scale. 1. The respondents’ demographic and User Characteristics Of the 51 respondents, 82% were male and 18% female; 22% were in the 18–25 age groups, 43% were 26–35 in age, 24% were 36–45 in age and 12% above the age of 45. In the qualification question, there were 23% BSc/BA, 24% MSc/PhD, and 8% OND/OCE. Also from the table below, it is clear that more than 50% of the respondents use internet banking at least from time to time and almost all of the respondents use other electronic means of electronic banking, e.g. ATM, and in frequent periods. In our analysis to the user characteristics, we found that MSc/PhD has a 24% of the respondents, 23% for the Bsc/BA, and 8% for OND/OCE. We realized that the higher educated the person is, the more usage of the online banking he/she perform. The mean value of 3.39 is considered a moderate level score that gives us an indication that this factor is Page 20 of 45
  • 21. positively affects the online internet banking services. Hypothesis 1 is supported moderately on the online internet banking services. Other demographic details can be found in Table 1. Demographic and User Number Percentage Mean Value 1.17 Characteristics Gender • Male 42 82 • Female 9 18 • total 51 100 • 18-25 11 22 • 26-35 22 43 • 36-45 12 24 • above 45 6 12 Age 2.27 Qualification • WASCE 0 0 • OND/OCE 4 8 • Bsc/BA 23 23 • Msc/PhD 24 3.39 24 Account Type • Current 6 12 • Savings 25 2.27 49 Page 21 of 45
  • 22. Number Percentage 20 Demographic and User Mean Value 39 Characteristics • Current & Savings purpose of opening the Account • Business 16 29 • Salary 28 50 • Other 12 2.11 21 Usage of Online Services • Yes 30 59 • No 21 41 Frequency of using 1.4 Online Services • Always 11 22 • Often 11 22 • Sometimes 6 12 • Rarely 9 18 • Never. 14 3.07 27 ATM Usage • Yes 49 96 • No 2 1.03 4 Page 22 of 45
  • 23. Demographic and User Number Percentage Mean Value 1.74 Characteristics Frequency of using ATM • Always 24 47 • Often 17 33 • Sometimes 9 18 • Rarely 1 2 • Never. 0 0 Table 2 2. Usefulness (M) In our review for this category, usefulness, which consists of 3 questions, we found that 76% of respondents agree that the internet banking is a useful and fast way to do financial tasks. The mean value of 4.17 shows this result. In the second item of this category, the results show that 92% of the respondents believe that internet and online banking is useful. The mean value of 4.45 reflects this fact. The third item in this category is representing the convenience related with internet banking which shows that 72% believe on its convenience and the mean value is 3.88 gives a clear indication of this result. The last item in this category is representing the benefit of shortening the geographic distance for the financial transactions for the clients and the results specify 84% of the respondents agree on that and the mean value is 4.27. Mean value for this factor is 4.19 (>3.67) which is considered high level score and indicate that most of the participants are highly agreed on perceived usefulness of online banking; therefore it is positively affect the usage of internet banking as hypothesized in our study. Page 23 of 45
  • 24. Number Usefulness (M) Percentage % Mean value Internet banking enables me to accomplish my tasks more quickly • Strongly disagree 1 2 • Disagree 2 4 • Neutral 9 18 • Agree 14 27 • Strongly agree 25 4.17 49 The Internet banking is useful • Strongly disagree 2 4 • Disagree 0 0 • Neutral 2 4 • Agree 16 31 • Strongly agree 31 4.45 61 Internet banking is a convenient way to manage my finances • Strongly disagree 3 6 • Disagree 4 8 • Neutral 7 14 • Agree 19 3.88 37 Page 24 of 45
  • 25. Number Usefulness (M) • 18 Strongly agree Internet banking geographic Percentage % Mean value 35 eliminates limitation and increases flexible in mobility. • Strongly disagree 2 4 • Disagree 4 8 • Neutral 2 4 • Agree 13 25 • Strongly agree 30 4.27 59 Table 3 3. Ease of Use (IV) In our review for this category, ease of use, which has 4 questions, we found that the 73.5% of respondents assume that it is easy to use online banking. In the following lines, we analyze the figures of each question. In our second item of the questionnaire, which is of the same meaning of the previous one, the results reflect almost the same value of 3.66, and with percentage of 69% of agreement of its positive effect on online banking. In the third item, we found that more than 77% agree that learning internet banking is easy and the mean value is 4.19 indicates that this item has a positive influence of the online banking. In the last item, the percentage of 80% and a mean value of 4 indicates that remembering” how to” in the online services has positive influence on the usage of internet online services. Page 25 of 45
  • 26. From the aforementioned points, we conclude that the independent variable ease of use is positively affecting the online banking services. Mean value for this factor is 3.863 (>3.67) which is considered high level and indicate that most of the participants highly agreed on perceived ease of use; therefore it is positively affects the usage of internet banking as hypothesized in our study. Question Items in each Numbers Percentage % Mean Value Variable Ease of Use (IV) It is easy to use Internet banking to accomplish my banking tasks • Strongly disagree 7 14 • Disagree 2 4 • Neutral 7 14 • Agree 21 41 • Strongly agree 14 3.64 27 Internet banking is easy to use • Strongly disagree 3 6 • Disagree 6 12 • Neutral 7 14 • Agree 24 47 • Strongly agree 11 3.66 22 Page 26 of 45
  • 27. Question Items in each Numbers Percentage % Mean Value Variable Learning to operate Internet banking would be easy for me • Strongly disagree 1 2 • Disagree 3 6 • Neutral 8 16 • Agree 12 24 • Strongly agree 27 4.19 53 It is easy for me to remember how to perform tasks with Internet banking • Strongly disagree 2 4 • Disagree 3 6 • Neutral 5 10 • Agree 14 29 • Strongly agree 25 4 51 Table 4 4. Intermittent Services Concerns (IV) From the figures shown in the table below, we found that a mean value of 2.57 and a percentage 77% of the respondents believe that power failure affects the bank's ICT operations. Page 27 of 45
  • 28. With regard of bank's performance in case of intermittent services, majority, 82% are not satisfied with the bank’s performance with mean value of 1.82. More than 50% of the respondents agree that with network failure their business and transactions suffers from delay and hider them from finishing their financial operations rapidly. The results also show clearly that more than 78% of the respondents admit that there is an intermittent services and power failures occurrence in banks frequently and the mean value is 2.7. On the future intention and attitude to change the banks that they are using, we found more than 50% of the respondents believe that they can bear the continual failures, as it is the only option to depend on in this stage of the fast growing business market, while 27% are willing to change the bank to another. The mean value is 1.88 for this question. Mean value for this factor is 2.084 (<2.33) which is considered a low level score; therefore this factor has a low impact on online banking services. From these results aforementioned, we find that our hypotheses of Intermittent Services Concerns are negatively affecting the online Services in Banks is slightly affecting the online banking services. Service Number Intermittent Percentage % Mean Value Concerns(IV) In case of power failure, do you think that the Bank’s ICT operations are affected • Always 16 31 • Often 11 22 • Sometimes 12 24 • Rarely 3 6 • Never. 9 18 When there are 2.57 intermittent Page 28 of 45
  • 29. services due to network failure, are you satisfied with bank’s performance? • Yes 9 18 • No 42 82 When network intermittent failure services 1.82 or happen, does it hinder you to finish your financial operations rapidly? • Yes 28 55 • No 23 1.45 45 How frequent is the power failure or intermittent services happen • Always 7 14 • Often 13 25 • Sometimes 20 39 • Rarely 9 18 • Never 2 4 14 27 2.7 Do you plan to change the bank in case of repeated ICT failure operations in the Bank • Yes 1.88 Page 29 of 45
  • 30. • No 29 57 • Other 8 16 Table 5 5. Security Concerns (IV) Upon performing transaction over the internet, almost 49% feel secure with these transactions and around 22% feel or have concerns regarding security over the internet. The mean value is 2.71 in this question. More than 52% of the respondents agree that they do not feel very safe providing personal privacy information over the Internet Banking while 34% disagree. The mean value is 3.17. In addition, in answering the statement "I do not perceive the information relating to user and Internet banking transactions as secure" around 36% of the respondents disagree and 32% agree and the mean value is 3.07. The worries that others will use the account while using the internet has 39% agree value, 42% disagree and the main value is 3.02. Mean value for this factor is 2.98 (> 2.33) which is considered a moderate level score; therefore this factor has a moderate impact on online banking services. From these results aforementioned, we find that our hypothesis of Security Concerns is negatively affecting the online Services in Banks with moderate effect. From the above results, it is clear that our hypothesis of the Security concern is supported by the results gained in this survey. Security Concern (IV) Number Percentage % Mean Value 5 12 I would not feel safe in making transactions over the Internet banking. 2.71 Page 30 of 45
  • 31. Security Concern (IV) Number Percentage % Mean Value • Strongly disagree • Disagree 15 37 • Neutral 12 29 • Agree 5 12 • Strongly agree 4 10 I would not feel totally safe providing personal privacy information over the Internet Banking. • Strongly disagree 5 12 • Disagree 10 24 • Neutral 5 12 • Agree 15 37 • Strongly agree 6 3.17 15 I do not perceive the information relating to user and Internet banking transactions as secure. • Strongly disagree 1 2 • Disagree 14 3.07 34 Page 31 of 45
  • 32. Security Concern (IV) Number Percentage % Mean Value • Neutral 13 32 • Agree 7 17 • Strongly agree 6 15 I’m worried to use Internet banking because other people may be able to access my account. • Strongly disagree 4 10 • Disagree 13 32 • Neutral 8 20 • Agree 10 24 • Strongly agree 6 3.02 15 It is easy for me to remember how to perform tasks with Internet banking. • Strongly disagree 6 15 • Disagree 11 27 • Neutral 9 22 • Agree 10 24 • Strongly agree 5 2.93 12 Page 32 of 45
  • 33. Table 6 Conclusion Many banks’ clients prefer nowadays to use online banking services. The innovative technological methods have driven the attitude of the people to use these techniques in performing their financial transactions. It became easy, in-hand, with lower fees, and convenient at any time and any place around the globe. These were the major advantages over the conventional old methods of business banking transactions. Another worthwhile In our study, we tried to focus on issues such as security and intermittent services that are not yet investigated in research. However, customers are suffering from and no one, up to our knowledge, has dig deeper in these issues. We turned our attention to find out the influence of these factors on the usage of online internet banking among students and lecturers who are users of this service in a sample of Nigerian society. The results showed that security aspects have negative association with online banking as well as intermittent services. In our in investigation, we also find that those users can bear these problems with their banks, as there is no alternative way to avoid them or to have a better solution to use the facilities of online internet banking. On the other hand, ease of use and usefulness are clearly having positive impact on the use of internet banking. This gives us very strong perception that most clients prefer and like to use the online services for its advantages over the conventional and traditional way of banking. The table below summarizes the results we found so far and compares our hypotheses with our findings. In conclusion, there is a need in future research to scale up the number of participants in our sample in such investigation of the proposed issues in this research. This survey may include variety of categories that should consist of clients and employees in banks with different positions as well. That will give more insight of the problems from both sides, the users and the bankers, and will help in generalize our empirical study. Page 33 of 45
  • 34. Results Hypotheses H1: The user characteristics based on the Hypothesis 1 is supported moderately. level of education is positively linked with Internet banking usage. H2: A client's perceived ease of use is Most of the participants are highly agreed on positively linked with perceived perceived usefulness. Hypothesis is supported usefulness of Internet banking use. highly H3: A client's usefulness is positively Most of the participants highly agreed on linked with Internet banking use. perceived ease of use and hypothesis is supported highly according to the mean value. H4: A perceived security concern is negatively associated banking use. with The mean value we reached in our survey for Internet this item shows moderate level score which can be translated as a moderate negative effect of this factor H5: A client's intermittent services Negatively affecting the online Services in concern is negatively associated with Banks is slightly affecting the online banking Internet banking use. services. Hypothesis is correct but slightly influenced but by this factor. Reference Agboola, A. A. (2001). Impact of electronic banking on customer services in Lagos, Nigeria. Ife Journal of Economics and Finance, 5(1&2). Alzaza, N. S., & Yaakub, A. R. (2011). Student's mobile information prototype for the higher education environment. American Journal of Economics and Business Administration, 3(1), 81. Chang, H. and Rizal, M. “An empirical investigation of Internet banking in Taiwan,” Global Journal of Business Research,Volume 4, Number 2, 2010, pp. 39-47. Cheng, T. C., Lam, D. Y., & Yeung, A. C. (2006). Adoption of internet banking: an empirical study in Hong Kong. Decision support systems, 42(3), 1558-1572. Page 34 of 45
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  • 37. Appendix Questionnaire Dear respondents, Kindly take some minutes of your valuable time to fill in the questionnaire with appropriate marks/answers. This questionnaire is for the purpose of research only use. Your feedback is highly appreciated and is ultimately confidential. Thanking you in advance for your esteemed time and co-operation. Figure 2 Figure 3 Page 37 of 45
  • 38. Figure 4 Figure 5 Figure 6 Page 38 of 45
  • 39. Figure 7 Figure 8 Figure 9 Page 39 of 45
  • 40. Figure 10 Figure 11 Figure 12 Page 40 of 45
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  • 45. Figure 26 Figure 27 Page 45 of 45