Automation through computer network has become a necessity in the world of banking today.  Thus this research work sets out to investigate the impact of electronic banking in the Nigerian Financial System.  Electronic banking has become a very important and indispensable tool for the present survival and growth of financial institutions, considering the dramatic increase in the number of banks in Nigeria in recent years.

The methodology of the study as discussed in Chapter three, comprises of the research and questionnaire design, data collection and data analysis techniques.  The main research question, Research questions and questions were used in the course of this research work.

After a thorough investigation, it was discovered that electronic banking has both negative and positive impact in the Nigerian financial system.  While it has greatly improved service delivery on the positive angle but on the negative side, it is prone to electronic fraud and unauthorized access to information.




There has been a significant change in the Nigerian Banking System during the past few years.  From the turn out of such changes, it is expected the banking system will experience greater changes in years to come.

A lot of factors have contributed to the changes experienced in the banking industry especially as it concerns electronic banking.  The move to banks recapitalisation which started in early 90’s but took effect finally in June 10, 2004 under Professor Charles Chukwuma Soludo the Central Bank of Nigeria Governor.  The few banks who survived the N25 billion capitalization now noticed that customers are no longer scared as to which bank is stronger than the other and fear of any of those banks collapsing was gone.  The banks now realized that the only way to attract and retain their customers is by excellent service delivery and introducing bank products that will make banking a lot easier and very convenient for their customers.  Some of such products are Valucard, ATM card, Mobile Banking on-line banking etc.

Also the desire for banks to go paperless also prompted them to introduce these electronic products.  Instead of a customer coming to the bank to fill a teller or a withdrawal slip, the customer can use the ATM care on a machine.

Banks also realized that in order to pay higher interest rates on customers accounts and still maintain a profit margin they placed fees for each of these electronic products and services being offered to their customers.  Previously the cost of these services had in effect been subsidized by low interest rates on bank deposits.  Deregulation forced banks to look at their bottom line and charge customers for such electronic products.

The importance of technology in delivering most of these financial services cannot be over emphasized because through automation, computerized technology has enabled banks to run their business more efficiently, their customers satisfied and also realized significant savings in the cost of human labour and in the life operation of their ‘physical plant’.

SAP earlier introduced in 1986 by the military regime is back in operation and it has affected the banking and oil servicing industries more than any other sector of the economy.  It has changed both the structure and the content of banking business.  Just as the number of banks grew tremendously in 2001, the techniques of delivering banking services and the range of products offered to customers have also changes especially with the N25 billion recapitalization which reduced the number of banks from 87 to 25 in 2005.