IDEAS home Printed from https://ideas.repec.org/a/bjc/journl/v11y2024i5p422-441.html
   My bibliography  Save this article

Assessing the Impact of Electronic Banking on the Financial Performance of Commercial Banks in Ghana

Author

Listed:
  • Dr. Edward Domina Attafuah

    (Accountant, University Health Service, University for Development Studies, Senior Tutor- New Life College, Member Institute of Directors)

  • Dr. Lord Emmanuel Yamoah

    (Lecturer, Takoradi Technical University, Procurement and Supply Chain Department, Member Institute of Directors)

  • Mr Godfred Amoako

    (Senior Audit Supervisor, Japan Motors Trading Company and Associates)

Abstract

The use of computer and communication networks to provide a variety of value-added goods and services to bank clients is known as electronic banking. Therefore, e-business is transforming the way that business is done across all industries, and commercial banks are no different from other businesses in this regard. The introduction of electronic banking services has shown to be a key advancement in the banking sector in Ghana. In light of this, the study looked into the connection between Ghana’s commercial banks’ performance and e-banking. The specific goal of the study was to determine whether there is a relationship between the independent variables—such as the number of ATMs, debit and credit cards issued to customers, point of sale terminals, and the amounts of e-banking usage such as electronic funds transfers, mobile banking, and internet banking—and the dependent variable, such as performance as measured by profit after tax. The findings of the study were that e-banking has a strong and significant effect on the profitability of commercial banks in the Ghanaian banking industry. Thus, there exists a positiverelationship between e-banking and bank performance. The significance test showed that theinfluence of bank innovations on bank profitability was statistically significant meaning that the combined effect of the bank innovations in this research is statistically significant in explaining the profits of commercial banks in Ghana. The study recommends to the management of those banks that are slow in innovation adoption, to move in and adopt various innovations in their operations to shore up their profitability. It also recommends that Government policymakers should review policies related to the promotion of innovation adoption and transfer of technology. Adoption of innovations will improve the profitability of organizations because it will translate to better tax revenues for the government.

Suggested Citation

  • Dr. Edward Domina Attafuah & Dr. Lord Emmanuel Yamoah & Mr Godfred Amoako, 2024. "Assessing the Impact of Electronic Banking on the Financial Performance of Commercial Banks in Ghana," International Journal of Research and Scientific Innovation, International Journal of Research and Scientific Innovation (IJRSI), vol. 11(5), pages 422-441, May.
    • Handle: RePEc:bjc:journl:v:11:y:2024:i:5:p:422-441
    as

    Download full text from publisher

    File URL: https://www.rsisinternational.org/journals/ijrsi/digital-library/volume-11-issue-5/422-441.pdf
    Download Restriction: no
    File URL: https://rsisinternational.org/journals/ijrsi/articles/assessing-the-impact-of-electronic-banking-on-the-financial-performance-of-commercial-banks-in-ghana/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Robert DeYoung, 2005. "The Performance of Internet-Based Business Models: Evidence from the Banking Industry," The Journal of Business, University of Chicago Press, vol. 78(3), pages 893-948, May.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Donal G. MCKILLOP & Barry QUINN, 2015. "Web Adoption By Irish Credit Unions: Performance Implications," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 86(3), pages 421-443, September.
    2. Shaohua Yang & Zeyun Li & Yaxin Ma & Xingxing Chen, 2018. "Does Electronic Banking Really Improve Bank Performance? Evidence in China," International Journal of Economics and Finance, Canadian Center of Science and Education, vol. 10(2), pages 82-94, February.
    3. Iftekhar Hasan & Heiko Schmiedel & Liang Song, 2012. "Returns to Retail Banking and Payments," Journal of Financial Services Research, Springer;Western Finance Association, vol. 41(3), pages 163-195, June.
    4. Alexandre Momparler & Carlos Lassala & Domingo Ribeiro, 2013. "Efficiency in banking services: a comparative analysis of Internet-primary and branching banks in the US," Service Business, Springer;Pan-Pacific Business Association, vol. 7(4), pages 641-663, December.
    5. Hernando, Ignacio & Nieto, Maria J., 2007. "Is the Internet delivery channel changing banks' performance? The case of Spanish banks," Journal of Banking & Finance, Elsevier, vol. 31(4), pages 1083-1099, April.
    6. Richard J. Sullivan & Zhu Wang, 2005. "Internet banking: an exploration in technology diffusion and impact," Payments System Research Working Paper PSR WP 05-05, Federal Reserve Bank of Kansas City.
    7. Gregory McKee & Albert Kagan, 2016. "Determinants of recent structural change for small asset U.S. credit unions," Review of Quantitative Finance and Accounting, Springer, vol. 47(3), pages 775-795, October.
    8. Zhu Wang, 2007. "Technological Innovation and Market Turbulence: The Dot-com Experience," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 10(1), pages 78-105, January.
    9. Valipour Pasha , Mohammad & Bastanzad , Hossein, 2017. "E-Banking Impact on the Profit Margin of Banks in Iran," Journal of Money and Economy, Monetary and Banking Research Institute, Central Bank of the Islamic Republic of Iran, vol. 12(2), pages 193-211, April.
    10. Robert DeYoung & William Hunter & Gregory Udell, 2004. "The Past, Present, and Probable Future for Community Banks," Journal of Financial Services Research, Springer;Western Finance Association, vol. 25(2), pages 85-133, April.
    11. Alexandre Momparler & Francisco Climent & Jose Ballester, 2012. "The impact of scale effects on the prevailing internet-based banking model in the US," Service Business, Springer;Pan-Pacific Business Association, vol. 6(2), pages 177-195, June.
    12. Hasan, Iftekhar & Schmiedel, Heiko & Song, Liang, 2010. "Return from retail banking and payments," Bank of Finland Research Discussion Papers 3/2010, Bank of Finland.
    13. Wu, Lei & Yu, Dongli & Lv, Yongbin, 2023. "Digital banking and deposit: Substitution effect of mobile applications on web services," Finance Research Letters, Elsevier, vol. 56(C).
    14. Chen, Shi & Lin, Ku-Jun, 2015. "Technology choice and bank performance with government capital injection under deposit insurance fund protection," International Review of Economics & Finance, Elsevier, vol. 39(C), pages 162-174.
    15. S Prasanth & S Sudhamathi, 2021. "Analysis of Indian Bank Customer's Attitude towards E-Banking," Shanlax International Journal of Management, Shanlax Journals, vol. 8(4), pages 82-89, April.
    16. Lambert, Susan C. & Davidson, Robyn A., 2013. "Applications of the business model in studies of enterprise success, innovation and classification: An analysis of empirical research from 1996 to 2010," European Management Journal, Elsevier, vol. 31(6), pages 668-681.
    17. Beck, Thorsten & Chen, Tao & Lin, Chen & Song, Frank M., 2016. "Financial innovation: The bright and the dark sides," Journal of Banking & Finance, Elsevier, vol. 72(C), pages 28-51.
    18. Hartmann-Wendels, Thomas & Mählmann, Thomas & Versen, Tobias, 2009. "Determinants of banks' risk exposure to new account fraud - Evidence from Germany," Journal of Banking & Finance, Elsevier, vol. 33(2), pages 347-357, February.
    19. W. Scott Frame & Lawrence J. White, 2009. "Technological change, financial innovation, and diffusion in banking," FRB Atlanta Working Paper 2009-10, Federal Reserve Bank of Atlanta.
    20. Imola Drigă & Dorina Niţă & Codruţa Dura, 2009. "Aspects Regarding Internet Banking Services in Romania," Annals of the University of Petrosani, Economics, University of Petrosani, Romania, vol. 9(3), pages 239-248.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bjc:journl:v:11:y:2024:i:5:p:422-441. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Dr. Renu Malsaria (email available below). General contact details of provider: https://rsisinternational.org/journals/ijrsi/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.