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This research was carried out to examine “electronic banking and the challenges of Nigeria business environment using first bank of Nigeria plc, Auchi as a case study. A general introduction was made and some aims and objectives of the study were stated. Issue also examined were background of the organization understudy. Literature relevant to the study was examined and some relevant terms were discussed. Also consider the instruction used in the collection of data on this research work, in conduction this research, information were both primary and secondary source of information. Textbook, journals, and other publication relating to the topic were consulted. The research hypothesis was tested. It was therefore recommended that management staff should be trained and enlightened on the electronic banking and this will go a long way to eradicate ignorance on the part of some management staff on the values of banking and this enhance effective and efficient business environment, which will eventually lead to the achievement of organizational goals.



1.1     Background to the Study

Modern banks now realized that only those that over haul their payment service delivery and operations are likely to survive and prosper in the 21st century (Opara 2010). This was due to pressure of globalization, consolidation, privatization deregulation, and rapidly changing technology in order to properly place themselves in favourable positions for completions and to be one of those corporations to be run with in the new century. Banks are making use of internet to execute mobile banking, this developed from bringing personal computers (PCs) together to form local and wide Area Network (LAN and WAN) through clients/server technology.

Many banks have installed modern computer inter-connectivity backbone that would enable them achieve communication of data and multimedia over internet, intranets and extranet. They also realized that they have to achieve not only management staff wide computer literacy but what could be called information literacy i.e knowing how to locate, analyze, store and use information. All staff and managers in a modern bank need to be able to search and gather data from several types of sources, analyze them, select relevant ones and organized them in such a manner to allow them make decisions based on the organized data.

Banks of the future realizes that the banking of tomorrow requires more of electronic manipulation and shuffling of bits-based money and other banking transactions instead of paper. In order words, paper based transaction e.g the internet. Whether a back would be successfully or not depends on the extent to which it is investing and using it in an innovation manner. This area has been tip to more competitive ground for banks that are operating in the post-consolidation era.

1.2     Statement of the Problem

Electronic banking is a driving force that is changing the landscape of the banking industry fundamentally towards a more competitive industry. Electronic banking has blurred the boundaries between different financial institutions, enable new financial and services by making existing financial services available in different packages. (Agbada 2008). However, the influence of electronic banking go far beyond this. Besides, the existing  business environment also posses some challenges to the smooth operations of electronic banking in Nigeria. Some of the operational challenges include epileptic power supply, dominance of cash transaction in the economy, low level of awareness among Nigerians etc (Agbada, 2008).

The development in electronic banking together with other financial innovation, are constantly bringing new challenges to finance theory and challenging people’s understanding of the financial system. It is not surprising that in the application of electronic banking in Nigeria, the financial institution have to face its problems. Communication over the internet are insecure and often congested. The financial institutions would also have to contend with other internet challenges including security, quality of service and some aberrations in electronic finance (Guardian Newspaper, 2001).

1.3     Research Questions

The study would provide answers to the following questions.

1                   Does Electronic Banking contribute to the efficiency and reliability of banks and banking?

2                   Does Electronic Banking improves bank customer’s relationship and retains them to their respective banks?

3                   To what extent would Electronic Banking improve the fortune of banks?

4                   What are the results of frequent changes and up-grading of information technology equipments on the banks profitability?

5                   Should all Banks in Nigeria ventures into electronic banking services rather than continuing with traditional banking?

1.4     Objectives of the Study

Some of the objectives which this research work aims to achieve are as follows:

1.     To evaluate the prospects of electronic banking in Nigeria banking industry and financial institutions.

2.     To evaluate the impact of electronic banking on operation of financial institutions in the country.

3.     To examine the effect of electronic on banking-customer relationship.

4.     To seek to examine the challenges facing the implementation of electronic banking in Nigeria.

5.     To examine the general international experience on the study.

1.5     Statement of Hypotheses  

(1)     There are no challenges of electronic banking system in Nigeria.

(2)  Electronic banking does not enhance bank profitability and efficiency.

1.6     Scope of the Study

In pursuance of the objectives of the study, attention shall be focused on electronic banking among other electronic commerce implementation. In other to conduct an empirical investigation into the adoption of electronic banking in Nigeria, this study shall examine the nature of electronic banking operations in First Bank of Nigeria PLC.

1.7     Significance of the Study

The study is significance because it would help to enlighten operation in the banking sector and other concerned individuals and organization in the adoption of electronic banking. The research shall basically identify the technical and operational challenges facing electronic banking in Nigeria business environment and suggests ways by which they could be tackled.

1.8     Operational Definition of Terms

Electronic Banking: Electronic banking can be defined as the process of performing various business activities for product and services in which two parties interact with each other by electronic means instead of interacting or having physical contact.

Banking:    Banking can be defined as the business activity of accepting and safeguarding money owned by other individuals and entities and them lending out this money in order to earn a profit.

Business:    Business also known as an enterprise or a firm, is an organization involved in the trade of goods, services or both to consumer in order to earn a living.

Business Environment:          Business environment can be defined as the different forces or surrounding that affect business operations. Such forces include customers, competitors, supplier, distributors, regulations, demographic, government, social and cultural factors e.t.c

Challenges: Challenges can be refers to as something that need a lot of skills, energy and determination to deal with or achieve especially something you have never done before and will enjoy doing. 

This material content is developed to serve as a GUIDE for students to conduct academic research

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