a critical appraisal on the factors affecting the use of internet banking presented by obasi michael...
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[A Critical Appraisal on the Factors Affecting the use of Internet Banking among the
Customers within the Nigeria Banking Sector: A Case Study of First Bank Nigeria
PLC]
BY
OBASI MICHAEL EBERECHUKWU
TO
ABSTRACT
Purpose: The factors affecting the use of internet banking amongst the customers is a high
stake process. There is an insufficient evidence base that would aid the banking institutions in
Nigeria in terms of guaranteeing the security of its customers. As a result of this the research
is aimed at critically appraising the factors affecting the use of internet banking amongst the
customers of First bank Nigeria plc together with their ability to restore trust and provide
assumption for re-conceptualising these processes.
Design/ Methodology/ Approach: The research was analytical and part of a bigger project
on the factors affecting the use of internet banking. It employed the use of 100 questionnaires
which was distributed among the customers of First bank Nigeria plc
Findings: One of the main findings of this research is based on the fact that trust is still a
major barrier for internet banking. At the same time it also important to note that the majority
of the people that makes use of the internet banking are mainly the young generation; and it
can be said that prior knowledge of computer is not a major factor that affects internet
banking
Research Limitations/ Implications: The sample size and use of questionnaire as a single
data gathering strategy does not allow broad generalization of findings. As a result of this, the
evidence obtained enabled the generation of useful hypothesis to stimulate research in this
area.
Originality/ Value: The research reported here provides a good basis and framework for
broader research to be carried out on the best ways of restoring the customers trust
2
TABLE OF CONTENTS PAGES
ABSTRACT 2
STATEMENT OF ORIGINALITY AND AUTHENTICITY 3
ACKNOWLEDGEMENT 4
CHAPTER ONE 9
INTRODUCTION 9
AIM OF THE RESEARCH 14RESEARCH OBJECTIVES 14SCOPE OF THE RESEARCH 14SIGNIFICANCE OF THE REESEARCH 15
Significance to the Researcher 15Significance to the Academicians 15Significance to the Organisation 15Significance to the Customers 15Commercial Significance 16Social Significance 16
RATIONALE FOR THE RESEARCH 16OVERVIEW OF FIRST BANK PLC NIGERIA 16SUMMARY OF INTRODUCTION 17
CHAPTER TWO 19
LITERATURE REVIEW 19
PURPOSE 20THE EASE OF USE OF INTERNET BANKING & HOW IT AFFECTS CUSTOMERS 20THE ISSUE OF TRUST IN THE NIGERIAN BANKING INDUSTRY 26POSSIBLE DIFFERENCES IN DEMOGRAPHIC FEATURES 29PRIOR KNOWLEDGE OF COMPUTERS AND TECHNOLOGIES 30CONCLUSION OF LITERATURE REVIEW 32
CHAPTER THREE 33
PURPOSE 33RESEARCH METHOD 34RESEARCH DESIGN 34
3
RESEARCH DESIGN PROCESS 35SOURCES AND TYPES OF DATA 36
PRIMARY AND SECONDARY RESEARCH 37PRIMARY RESEARCH 37
Advantages of Primary Research 38Disadvantages of Primary Research 38
SECONDARY RESEARCH 39Advantages of Secondary Research 40Disadvantages of Secondary Research 40
DATA COLLECTION TOOLS 40DATA COLLECTION TOOLS 41SAMPLE TECHNIQUES AND METHODS 41
PROBABILITY AND NON PROBABILITY SAMPLING 41PROBABILITY SAMPLING 42
Random Sampling 42Systematic Sampling 43Stratified Sampling 43
NON PROBABILITY SAMPLING 44Convenience Sampling 44Judgment Sampling 44Quota Sampling 45Snowball Sampling 45
DATA ANALYSIS METHOD 45QUALITATIVE AND QUANTITIVE RESEACRH 46
QUANTITATIVE RESEARCH 46QUALITATIVE RESEARCH 47RESEARCH POPULATION 47DATA ANALYSIS AND PRESENTATION 48RELIABILITY 48VALIDITY 48LIMITATIONS OF THE RESEARCH 48ETHICAL ISSUES 49CONCLUSION OF THE RESEARCH METHODOLOGY 50
CHAPTER FOUR 52
FINDINGS OF THE RESEARCH 52
PURPOSE 524
FINDINGS 52CONCLUSION OF THE FINDINGS 62
CHAPTER FIVE 63
DISCUSSION OF THE FINDINGS 63
PURPOSE 63DIFFFERENCES IN DEMOGRAPHIC FEATURES 63THE ISSUE OF TRUST & SECURITY ON INTERNET BANKING 64PRIOR KNOWLEDGE OF COMPUTER AND ITS EFFECT ON INTERNET BANKING 67EASE OF USE & HOW IT AFFECTS THE ADOPTION OF INTERENT BANKING 68
IMPLICATIONS FOR FUTURE RESEARCH 70
CONCLUSION 71
RECOMMENDATION 74
REFERENCES 76
BIBLIOGRAPHY 88
WEBSITES 94
APPENDIX 1 95
QUESTIONNAIRE 95
5
CHAPTER ONE
INTRODUCTION
In recent years the growth and development of information technology have brought about
changes in the way and manner by which things are done within the organisation. As a result
of this the global business environment has been affected greatly by the technological
improvement and advancement; and this has brought about tremendous changes on the
processes that organisation such as First bank Nigeria plc adopts in terms of serving their
customers. It can be said that the introduction of internet banking into the banking system in
Nigeria have helped the country to be able to come up with easy ways of serving its
customers thereby making its products and services accessible to its stakeholders (Cheung,
2001)
At the same time it is also important to note that the need for First bank Nigeria plc to
establish relationship, loyalty and satisfaction among its customers has become a top priority
for the bank and as a result of this have brought about advancement in terms of internet
banking and innovation within the organisation. According to Akinci et al (2004) it can also
be said that the adoption of internet banking within the business environment of the
organisation has become a necessity for both the banks and their individual customers. This is
because of the fact that its adoption will help the organisation to deliver better services to its
customers which will bring about customer’s satisfaction and at the same time help the
organisation to deliver a more cost effective service (Barnes, 2002).
In developing economies such as Nigeria it is important to note that organisations such as
First bank Nigeria plc encounter a lot of problems in terms of educating and equipping its
employees on how best to use its internet banking facilities. The introduction of the internet
6
banking within the organisation have been able to help the organisation to come up with
better ways of transacting businesses activities within its environment. Developing countries
such as Nigeria when compared to other countries of the world such as the United Kingdom
and United States; it can be said that the country is still behind in terms of infrastructural
development, the adoption of internet banking and e-commerce (Ajzen and Fishbein, 2008;
Ajzen and Madden, 2006). According to Corritore (2003) it can also be argued that other
factors such as inadequate information about the economy, poor infrastructure, inadequate
trained man power and poor banking infrastructure are some of the factors that pose as
obstacle and hindrance to the development of internet banking in Nigeria. It is also important
to note that despite this challenges faced by financial banks in Nigeria such as First bank plc
the organisation have been able to emerge as one of the successful banks within the country
and Africa as a whole.
According to Adams et al (2002) the term internet banking allows customers to be able to
conduct financial transactions on a secure website operated by their banks, credit union or
building society. It can also be said that internet banking are made up of many features and
capabilities but traditionally have some that are applicable specific which includes
transactional, non transactional, financial institution administration, transaction approval
process and management of multiple users having varying levels of authority. This simply
means that the term internet banking is used by the customers of first bank plc in terms of
performing financial transactions such as an account to account transfer, loan application,
opening a new account and payment of utility bills. At the same time it can also be said that
the internet banking is also used by the customers to be able to access its online bank
statements and at the same time chat with the organisation through its virtual network
(Bagozzi, 2007).
7
Among the customers of First bank plc the issue of trust is the major factor that affects
internet banking within the organisation; this is because the customers of the organisation
wants their personal details to be protected thereby avoiding the transfer of their information
to the third party without their consent. As a result of this in order for the organisation to
compete favourably among its competitors within its business environment; they need to
understand the possible factors that affect its customers and at the same time be able to come
up with necessary steps that will guarantee the safety of its stakeholders. In order for financial
institution such as First bank Nigeria plc to succeed in its objective of building a long term
relations with its customers they need to understand the factors that influence and attract
customers to use internet banking. This is because the ability of organisations to build trust
and relationships with its customers goes a long way in terms of helping the business to
maintain its position and compete favourably within its market place. As a result of these
financial institutions such as First bank Nigeria plc needs to understand the best ways of
attracting new customers from different cultures and backgrounds to use their services both
online and offline (Davis, 2009).
The timely diffusion of new technology has been found to be one of the main elements of
economic growth (Balachandran et al, 2001). An example of such new technology is internet
banking, a service innovation that has revolutionised the banking industry worldwide
(Bagozzi et al, 2009). Understanding the acceptance of such new technology hence becomes
important from a policy point of view. Internet banking has become an important distribution
channel both for the banks and their customers, for the banks it is expected to lead to
reduction in operating costs, help to retain current customers while also attracting a new
customer base from existing internet users and for the customer a convenient way to execute
their bank transactions anytime and anywhere (Rotchanakitumnuai and Speece, 2003).
8
Internet banking has become a vehicle through which Nigeria banks are attracting new
customers, building customer loyalty, enhancing customer relationships, retaining customers,
increasing market share, increasing profitability and reducing transaction cost. The need to
discover the factors that have driven internet banking usage in Nigeria motivates this study.
The Nigerian banking sector has experienced a lot of mergers and acquisitions in recent times
following in the onset of consolidation which started in 2005. These have brought about a lot
of changes and need for improvement. Customer satisfaction and loyalty have now become a
top priority for the banks and this involves a lot of innovation in technology and financial
products. Nigerian banks in the quest to retain their customers and keep up with counterparts
in the rest of world have invested a lot in technology. An advance in technology such as
“internet banking” has now become a necessity for both the banks and their customers. Its
adoption will help the banks deliver better satisfaction to their customers and will also help
them deliver a more cost effective service (Rotchanakitumnuai and Speece, 2003).
Developing countries still lag behind the more developed countries in terms of internet
banking and e-commerce adoption by a large distance despite its’ global reach hence they
also miss out on the huge benefits they stand to gain (Barnes, 2002). Factors such as
inadequate communication infrastructure, unavailability of trained man power, poorly kept
records about the economy and environment also inadequate banking infrastructure are some
of the issues that pose a hindrance to the growth of e-commerce in developing countries
(Blaxter et al., 1996). Despite all of these challenges Nigerian banks have emerged among
the successful banks in Africa in terms of growth.
According to Khalfan and Akbar (2006) the term internet banking simply means a system
that allows individuals carry out banking activities from the convenience of their homes,
offices and various other places. It thereby allows customers carry out tradition banking
9
services such as fund transfer, opening accounts, bills payment and various other transactions
using the internet as a delivery channel (Mailhotra and Singh, 2008). Despite the various
opportunities both the bank and their customers stand to gain from the adoption of this form
of banking things have not moved as quickly as many researchers have anticipated with most
customers still considering internet banking less important than other forms of electronic
banking such as ATMs and telebanking (Rotchanakitumnuai and Speece, 2003; Aladwani,
2001; Suganthi et al., 2001).
Giving the problem stated above there is the need to look into the issue of internet banking.
Only a handful of studies have specifically examined the use of internet banking with most of
the other studies focusing on other forms of electronic banking and furthermore most of these
studies have been done in the developed economies (Malhotra and McCort, 2008). A few
studies have be done looking at some Asian and other emerging economies (Balachandran et
al., 2000; Suganthi et al., 2001; Gerrard and Cunningham, 2003; Rotchanakitumnual and
Speece, 2003) however even fewer studies focusing specifically on internet banking use in
Africa have been carried out e.g. (Alagheband, 2012).
The paucity of literature on internet banking in Africa and Nigeria in particular further
emphasise the importance of carrying out this research. An understanding of the factors that
affect the use of internet banking will assist the bank in improving their services thereby
retaining existing customers and attracting new ones, it will also help the bank take measures
that help increase the uptake of internet banking thereby leading to huge savings in terms of
running costs. Hence the adoption of internet banking in Nigeria by bank customers warrants
investigation in order to scrutinize some of the factors that have influenced its use in the face
of all these challenges hence the specific objectives of this study are stated below
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AIM OF THE RESEARCH
The aim of the research is to investigate the factors affecting the use of internet banking
amongst customers of First bank Nigeria plc
RESEARCH OBJECTIVES
1. To evaluate possible differences in demographic features, that exist between customers that
use internet banking and those who do not use the service.
2. To assess how ease of use affects the adoption of internet banking by customers.
3. To investigate how issues pertaining to trust in the system as well security affect the
adoption of internet banking.
4. To critically examine how prior knowledge of computers affect the use of internet banking.
5. To make recommendations based on the findings to the management of first bank Nigeria.
SCOPE OF THE RESEARCH
The study will be limited among the customers of First bank Nigeria plc; its main branch in
Allen Avenue in Lagos state Nigeria have been chosen in order to be able to reach a large
number of its customers. At the same time it is important to note that First bank Nigeria plc
has been chosen because of the fact that the organisation was among the first financial
institutions within the country to introduce internet banking within its business processes.
11
SIGNIFICANCE OF THE REESEARCH
The research will be of immense significance to first bank Nigeria plc together with its
customers and other financial institutions that adopts the use of internet banking within its
business environment. Apart from the organisation and the customers of the bank the research
will also go ahead to benefit other groups listed below which includes the following:
Significance to the Researcher
The research has helped the researcher to better understand the concept of internet banking
together with the factors that affects it within the organisation; at the same time has helped
the researcher to enlarge and broaden its intellectual horizon on the topic under discussion
Significance to the Academicians
The research has helped the researcher to be able to contribute its own quota to the growth
and development of the body of knowledge and at the same time have become a reference
point when conducting future research and academic work
Significance to the Organisation
The research have at the same time helped the organisation to understand the problems faced
by its customers while using the internet banking together with the best ways of adopting the
system in order to be able to compete effectively within their business environment
Significance to the Customers
The research have also benefitted the customers tremendously because it has been able to
help the organisation to be able to understand the importance of internet banking and the best
possible ways of dealing with the issues they encounter in the process of using this system of
banking
12
Commercial Significance
The research have also helped the organisation to understand the importance and the benefits
of internet banking and its ability in terms of helping the business to compete favourably
within its environment
Social Significance
The research has also helped the organisation to understand the need to be socially
responsible within the business environment and the importance of contributing their own
quota towards the growth and development of the society in which they operate
RATIONALE FOR THE RESEARCH
Having lived in Nigeria over the years and at the same time worked with First Bank plc
Nigeria as one of its employees for a period of 3 years prompted my curiosity on the issue of
internet banking as regards to the organisation. It is also important to note that over the year’s
First bank plc have distinguished itself in the way and manner it goes about in terms of
conducting its business activities in order to be able to satisfy its customers. At the same time
it is important to note that First bank plc is among the first financial institutions in Nigeria to
introduce internet banking within its business activities. As a result of this my main objective
of the subject under scrutiny is to investigate the factors that affect the use of internet banking
within the organisation.
OVERVIEW OF FIRST BANK PLC NIGERIA
First Bank of Nigeria is a Nigeria premier bank and financial services firm founded in 1894
by Alfred Jones; it is said to be the third largest bank and the largest retail lender in the
country with its headquarters in Lagos Nigeria. The bank is a financial industry that
specialises in the provision of financial services to its customers; it commenced operation in
13
Lagos under the name Bank of British West Africa; in 1957 the bank changed its name to
Bank of West Africa. Africa. Another name change occurred in 1966 following its merger
with standard bank; UK when the bank adopted the name Standard Bank of West Africa. In
1969 following the Companies Decree of 1968 the bank was incorporated locally as the
Standard Bank of Nigeria Limited. Further name changes in 1979 and 1991 to First Bank of
Nigeria Limited and First Bank of Nigeria Plc.
The bank has grown to be one of the biggest banks in Nigeria with its branches all over the
country and some parts of Africa. It is important to note that First bank plc started the use of
internet banking in mid 2000 and since then have continue to advance in the way and manner
it renders its services to its customers. Some of the products offered by the bank includes E-
banking, consumer banking, wholesale banking, agricultural financing, bills payment, money
transfer and First Diaspora. The various E- banking products offered by the bank include
First online, First mobile, First alert, First pay, First collect. The E- banking product which is
relevant to the research is first online which the internet banking product is offered by First
Bank. As at quarter of 2011 the bank recorded US$1.35 billion in its revenue and US$18.6
billion in its total assets and employs over 5000 employees in its branches worldwide.
Source: (Adapted the Information from First Bank, 2011)
SUMMARY OF INTRODUCTION
Having examined the purpose of this chapter which is to evaluate the factors affecting the use
of internet banking amongst customers of First bank Nigeria; it can be said that the use of
internet banking helps the customers to be able to transact their business activities online
without the need of visiting the bank. At the same time it can also be said that the customer is
faced with lots of challenges while using the internet banking system; this is because of the
14
fact that internet banking fails to guarantee the safety and security of the customer’s details.
At the same time it is important to note that Nigeria is a country that is still in its
development stages and as a result of this is faced with the problems of security in terms of
its online business activities.
15
CHAPTER TWO
LITERATURE REVIEW
As stated by Blaxter et al (2006) the term literature review simply means the review or
description of relevant academic literature on a particular field of study which is conducted in
order to locate the research project and at the same time form the context that provides insight
into previous academic work. It is important to note that the aim of this chapter is to reassess
the critical points of current knowledge such as substantive findings as wells as theoretical
and methodological contributions to a particular topic. At the same time it can also be said
that literature reviews are mainly based on secondary sources and at the same time don not
report any primary or original experiment or piece of work. The ultimate goal of a literature
review is to bring the reader up to date with current information on a given topic and forms
the basis for another goal, such as future research that may be needed in the area.
Literature review is made up of logical flow of ideas, references and appropriate use of words
together with an unbiased and complete view of the previous research on the given topic or
subject of study. It can also be said that the term literature review gives a brief introduction of
what has been said, the key writers and the prevailing theories used in conducting the
research. In the process of conducting a literature review the primary research that can be
employed may be verbal, but in most cases the review is mainly conducted on written or
secondary documents.
It can also be said that a literature review seeks to summarise, evaluate, integrate and clarify
the content of primary study or research (Cooper, 2008). As a result of this the aim of a
literature review can be achieved through a critical analysis of a particular issue together with
a complete understanding of relevant theoretical frameworks underpinning important issues
16
of study. In this research the factors affecting the use of internet banking amongst customers
of First bank Nigeria plc will be evaluated in order to understand the best ways by which the
organisation can be able to improve in their business activities within its environment
PURPOSE
The purpose of this chapter is to review the existing body of literature which is related to the
topic under discussion by providing proof of scholarship and a critical points of current
knowledge such as substantive findings as wells as theoretical and methodological
contributions to a particular topic
THE EASE OF USE OF INTERNET BANKING & HOW IT AFFECTS
CUSTOMERS
According to Khalfan and Akbar (2006) the term internet banking simply means a system
that allows individuals to carry out banking activities from the convenience of their homes,
offices and various other places. It thereby allows customers carry out tradition banking
services such as fund transfer, opening accounts, bills payment and various other transactions
using the internet as a delivery channel. Despite the various opportunities both the bank and
their customers stand to gain from the adoption of this form of banking things have not
moved as quickly as many researchers have anticipated with most customers still considering
internet banking less important than other forms of electronic banking such as ATMs and
telebanking (Rotchanakitumnuai and Speece, 2003).
It can also be said that the common of features of internet banking includes the fact that it can
be categorised into transactional, payment to third parties, funds transfer, investment, loan
application, non transactional, financial institution administration, transaction approval
process and management of multiple users. This simply mean that the internet banking can be
17
used in performing financial transaction within the organisation such as bill payment, loan
application, opening new account and at the same time it is also used in non transactional
activities by the customers such as viewing of recent transactions and online statements
together with downloading bank statements (Jun and Cai, 2001).
In the Nigerian banking context the term internet banking is in most cases known as online
banking and it is a term used to encompass all banking services that are not traditionally used
in the banking sector. Some of these services include electronic banking, personal computer
banking, telephone banking, home banking and internet banking. Stated below are the
different forms of online banking and they include the following:
Features and Functions
Features Telephone Self Service ATMs Internet Banking
Banking Terminals
Withdrawals Y
Deposits Y
Balance Enquiries Y Y Y Y
Interim Statements Y Y Y
Transfer Funds Y Y Y Y
Cheque Book Orders Y Y Y Y
Change ATM Card PIN Y Y Y
Stop Payment of Cheques Y Y Y
Rates Y Y Y
Stop Orders Y Y
Source: (Adapted from AC Nelson Consult, 2012)
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It is important to note that the areas represented with (Y) signifies those banking activities
that can performed First Bank Nigeria plc either through telephone banking, self-service
terminals, automated teller machines and with the use of internet banking. Looking at the
table above it can be said that the amount of activities that can be performed by the customers
of the organisation through the use of internet banking include bank enquiries, uploading of
interim statements, transfer of funds, ordering of cheque books, changing of ATM card PIN,
payment of cheques and finally putting a stop to order in the form of postal orders or
purchased items (Featherman and Pavlov, 2008).
This simply means that internet banking goes a long way in terms of helping the customers to
carry out their banking activities more effectively without necessary visiting the bank in
person. It can also be said that the presence of effective and up to date internet banking
system within an organisation goes a long way in terms of distinguishing the business
activities of the institution when compared to its competitors within the industry (Hoffman,
1996). As stated by Daniel (1999) an effective internet banking system serves a competitive
for the organisation and helps them to differentiate themselves from their competitors.
On the other hand it can also be argued that the presence of internet banking system makes it
difficult for the customers to be able to carry out their banking activities effectively within
the organisation. This is because of the fact that the organisation has failed in its obligation of
educating its customers on the best ways to operate the internet banking and at the same time
the system on its own has failed to guarantee the trust of its customers (Karjaluoto, 2002).
As identified by Barczak (2007) internet banking is a remote home or office service that is
offered to banks personal customers in order to carry out routine banking transactions
through the use of internet. This type of banking is said to be convenient and easily accessible
19
because of the fact that the bank allows the customer to make use of the banks software or
that of an internet service provider
At the same time it allows customers to access their individual accounts from any location as
long as they have an internet access; in addition it provides the customers with the ability to
perform transactions through the banks websites without the need of visiting the bank
physically or any nearest automated teller machines. It can also be said that the services
available for internet bank system vary from one bank to another and as stated by Al-Ashban
and Burney (2009) almost all the banks that offer internet banking services allow their
customers to check the balances in their personal accounts, apply for loans, transfer funds and
order electronic bill payments together with the trading of stocks or mutual funds.
According to Howcroft et al (2002) it is important to note that the use of internet banking
system offers a lot of advantages to the customers when compared with the traditional
banking methods. Some of these advantages can be said to include the fact that internet
banking saves the time of the customer. This is because internet banking helps the customer
to be able to access its individual accounts without the need of visiting the branch physically.
It can also be said that this system of banking is convenient for the customers because of the
fact that an individual account can be paid and funds transferred without the need of queuing
at the bank or writing cheques (Kennedy, 1993).
In terms of accessibility, the services of the bank can be accessed on a day basis including
weekends. With the use of internet banking system transactions are executed and confirmed
almost immediately; and it allows the customers of the bank to do virtually everything
ranging from checking of an account balance to applying for a mortgage. At the same time it
can be said that with internet banking customers can be able to choose their own PIN and at
the same time prevent unauthorised access to their different individual accounts. The need to
20
carry large amount of cash around is reduced or minimised through the use of internet
banking system within financial institutions such as the First Bank Nigeria plc (Durkin, 2004)
At the same time the use of internet banking can also be criticised because of the fact that the
use of internet banking has certain systems requirements such as accessibility to computers,
memory, screen resolution and browsers, which prove to be an additional cost to the customer
when compared to the traditional banking methods or other online banking services such as
the use of automated teller machines. In a country like Nigeria majority of First Bank Nigeria
plc have no access to their own personal computers and the use of the public computers
involves an additional cost to their limited available resources (Liao et al., 2009)
This makes it difficult for them to be able to utilise the internet banking services provided by
their local banks. As stated by Locket and Littler (1997) another area of criticism about
internet banking is based on the fact that the use of internet banking does not allow the
customer to make deposits or withdrawals when using the services. Its purpose is mainly to
check the bank statements and at the same time transfer some funds; and at the same time it
can be said that the security system of the services is a threat to the customers because of the
fact that it can make hackers and fraudster to get hold of the customer’s personal details.
In Nigeria today the main domestic banks such as First Bank Nigeria plc, Guarantee Trust
Bank, Oceanic Bank and Union Bank plc and others are all offering internet banking services.
These banks continue to invest a lot of resources in terms of developing the internet banking
system within their different organisation with the main objective of encouraging customers
to adapt to this innovation. According to Adams et al (2002) Nigeria internet population
continues to grow and is expected to have an internet population of over 65 million by the
end of 2015; and at the same time plans to recruit over 50,000 users to the service in a month.
21
Banking institution in Nigeria such as First Bank Nigeria plc in their bid to promote internet
banking within their individual customers has offered free Internet Service Provider service
in order to encourage the use of the internet and internet banking and the offer include setting
up of an information technology department that handles some technical issues within the
organisation together with offering 10 megabytes of free web space. The bank hopes that the
publicity surrounding the service will generate enough interest in internet banking among the
large population of Nigerians which will help them to be able to double their customer base.
It can be said that the organisation currently has over 153,000 customers who make use of its
online banking services in its branches within and outside Nigeria Luarn and Lin (2004).
Apart from the domestic banks there is new type of bank emerging in Nigeria and in other
countries of the world such as the United Kingdom and the United States known as the virtual
bank. The major difference between the virtual bank and other banking institutions is based
on the fact that a virtual bank does not have a physical presence, or a particular branch in
terms of building (Lee and Turban, 2001). This is because of the fact that this type of bank
performs most of the services provided by the domestic banks with regard to internet
banking. This type of bank operates effectively through the use of online or internet banking;
and it is important to note that according a recent survey First Bank Nigeria plc came out on
top as one of the best banks that offer the broadcast range of internet banking services in
Nigeria. This is because of the simple fact that the bank allows its customers to perform
more transactions on the internet than any other bank in Nigeria such as Union Bank plc,
Intercontinental bank and Guaranteed Trust bank plc.
THE ISSUE OF TRUST IN THE NIGERIAN BANKING INDUSTRY
As stated by Hoy and Tarter (2004) the term trust is a very complex construct and it is
multidimensional in nature; it can be said to mean the ability to believe in the honesty and
22
reliability of others or a system. It can be said that one of the most frequent attributes of trust
is based on the fact that trust is a psychological state comprising the intention to accept
vulnerability based upon expectations of the intention or behaviour of another under
conditions of risk and interdependence (Van and Sniezek, 2005). This simply means that the
term trust is a psychological state in terms of beliefs and positive expectations with positive
or non negative outcomes that requires the consent of other members and developed under
uncertain, risk and interdependence (Rousseau, 1998; Bhattacharya et al., 1998).
As stated by McKnight et al (2002) the presence of institution-base trust, disposition to trust
and perceived site quality goes a long way in terms of affecting customers trusting beliefs in
the internet banking system used by organisations such as First Bank Nigeria plc. As a result
of this it can be said that disposition to trust, institution-based, trusting beliefs and perceived
Site quality affects the customer’s intention to engage in trust related behaviours with a
specific financial organisation. As argued by Gefen et al (2003) it can also be said that
general web experience affect customer’s perceptions of the institutional environment; and as
a result of this they suggested that the presence of institutional based trust affects customers
trust with an organisation.
As identified by McKnight et al (2002) the term disposition to trust can be defined as the
general propensity to trust others in the e-commerce context. It can be said that this type of
trust represents the inclination to trust on other people and is the ability of an ability to trust
an individual based on the traits the person posses that he has tried to develop through his
lifetime (Tan and Sutherland, 2004). This type of trait is based on personality type and
development experience; as a result of this an individual with a high propensity to trust others
tend to colour the interpretations of the relationships build between the trustor and trustee.
According to Chang and Cheung (2005) institutional-based trust on the other hand refers to a
23
person’s perception of the institutional environment; which leads to higher levels of trust in
the banking organisation that is offering the internet banking system.
As stated by Moorman et al (2003) in organisations where the customer trust is not
guaranteed in the internet banking opportunities that will rise from implementing web
technology will be restricted and this will bring about lost of opportunities within the
business unit. For organisation hoping to compete favourably within its industry; its internet
banking system must be built in such a way that it guarantees the trust and confidence of its
customers this is believe will help the organisation to stand out in its business activities and at
the same time help them to achieve their objectives.
As a result of this the term trust can be said to be an expectation of ability to perform,
reliability and intentionality of a partner which can be viewed as a behavioral intention
behaviour that reflects dependence on the other partner. In addition, according to Hunt (2004)
the term trust can be said to be the perception of confidence in the exchange partner’s
reliability and integrity. Looking at both definitions it is important to note the relevant of the
keys words is confidence and reliability in the concept of trust; and at the same time it can be
said that one of the reasons why customers do not trust the internet technology or the internet
banking system is based on three reasons which includes security of the system, distrust of
service providers and worries about the reliability of internet services (Lee and Turban,
2001).
As a result of this the strong concern of the security of the internet banking system is one
common factor related to unwillingness to use internet channels for commerce (Black et al,
2001). This is because of the fact that security breaches on the internet banking system can
bring about numerous problems ranging disruption of information access and destruction of
operating systems. As stated by Black et al (2001) poor security system on the internet
24
banking system brings about lack of trust on the part of the customers and at the same time
increases the level of risk in terms of using the Web for financial transactions. At the same
time it is important to note that reputation is important, as distrust of the service provider is a
related factor.
According to Jarvenpaa et al (2002) the reputation of banking institutions such as first bank
Nigeria plc goes a long way in terms of assuring the safety of the customers; at the same time
it helps to restore confidence on the customers and at the same time guarantee the honesty
and integrity of the organisation. As a result of this for organisations such as First Bank
Nigeria plc to function effectively within its business environment must be able to have
experience in business functions, policy and at the same time be able to support the personnel
to build reputation as a competent technology-based service provider for the organisation.
For organisations such as First Bank Nigeria plc to be able to compete effectively within the
banking sector within and outside the country they need to try and establish a good reputation
among their customers. A good reputation helps organisations to gain the trust of their
customers and is said to be one of the major factors that affect customer adoption of new
technology-based service delivery (Aladwani, 2001). It can also be said that reputation
depends largely on policy promises to customers which includes privacy policy as most do
not like their personal information revealed in an inappropriate manner or misused by others
over the internet (Turban et al., 2002). As identified by Walker et al (2002) the presence of
perceived risk can also cause customers to reject the use of internet banking within the
organisation or the introduction of technology-based service delivery. This is because of the
fact that perceived risk is related to reliability and system failure. In addition, it can be said
that the presence of perceived risk in an organisation brings about lack of trust in terms of its
ability to use the internet banking system (Kraft et al., 20005)
25
POSSIBLE DIFFERENCES IN DEMOGRAPHIC FEATURES
According to Howcroft et al (2002) it is important to note that possible features could affect
customer’s attitudes towards internet banking within the banking institutions; and some of
these features include a person’s demographic, motivation and behaviour towards different
banking technologies and individual acceptance of new technology. In terms of the
demographics factor a recent survey revealed that younger consumers value the convenience
or time saving potential of internet banking when compared to their older counterparts. This
is because of the fact that younger customers regard the lack of face-to-face contact in the
bank as less important than the older customers. The older customers lack full confidence on
the internet banking system and as a result of this prefer the face to face contact they get
whenever they go to the bank for their business transactions (Eriksson et al., 2008).
As stated by Karjaluoto et al (2002) the educational level of the customers does not in any
way affect their decision of using the internet banking when transacting their business
activities. On the other hand Sarel and Marmorstein (2003a, b) beg to differ by stating that
household income and education has a significant effect on the adoption of internet banking
within organisations. This is in accordance with their latest research on the typical user of
internet banking in Finnish market in which they concluded that relatively young and wealthy
person with good knowledge computers and especially the internet.
Among the motives for using the internet banking system for the motivational clusters for
people’s money management philosophies includes security consciousness, maximisers,
hassle avoiders and instant gratification (Barczak, et al., 1997). This simply means that for
organisations such as First Bank Nigeria plc to be able to accept the internet banking system
as a new way of transacting their businesses within the organisation they need to be able to
prepare and advise their customers on the need of changing from their old ways of banking to
26
a new way of transacting their business activities within the organisation. They can achieve
this by organising seminars and workshops for their customers on the need and importance
associated with internet banking when transacting their businesses (Sathye, 1999). Thornton
and White (2001) argued by stating that the customers of banking institutions are not
generally predisposed to change; this is because of the fact that their behaviours are not used
to the widespread usage of internet banking system.
PRIOR KNOWLEDGE OF COMPUTERS AND TECHNOLOGIES
As stated by Karjaluoto et al (2002) prior know of computers and technological equipments
goes a long way in terms of influencing the both the attitudes towards online banking and
actual behaviours. According to their study prior knowledge or experience of computer have
an important and significant impact in terms of the ability to use the internet banking system
within the banking industry. Apart from the fact that it helps the use of internet banking
system it also have a positive effect on both attitudes and satisfied customers tend to keep up
with their current delivery channel.
It can also be said that other factors that affect internet banking and actual behaviours were as
a result of the attitude of the customers; this is because of the fact that most of them are either
satisfied with the system or dissatisfied with it. At the same time it can be said that influence
from families and others strongly affect the attitudes and behaviour of customers towards the
use of internet banking. As stated by Lewis (2003) one of the reasons why consumers switch
delivery channel from the traditional way of banking towards the internet banking is because
of the fact that they are fed up with the new ways of doing things and as a result of this wants
to try the new ways of doing things within the organisation.
27
It is important to note that one of the reasons why the customers of First bank Nigeria plc are
dissatisfied with the traditional way of banking was as a result of the fact that it involves a
slow speed of service in branches; and some of the opening hours of the branches are
sometimes inconvenient for the customers. At the same time it can also be said that some of
the branches are very small and the staff within this organisation lacks the necessary manners
in terms of attending to a customers. According to Joseph and Stone (2003) in their recent
study stated that a proper implementation and delivery of internet banking within the
organisation brings about customer satisfaction. This simply means that the customers of the
organisation prefer a mix of rather than any one single delivery channel; and the need for the
service providers to understand and improve its channel within the overall service offering
rather than concentrating efforts on improving one delivery channel in isolation (Patricio et
al., 2003).
As pointed by Karjaluoto et al (2002) in their recent survey pointed that the general attitudes
of customers towards the use of internet banking is based on the fact that they are faster way
of transacting business activities within the bank, is cheaper and more service-oriented when
compared to the traditional way of banking. At the same time it can also be said that trust and
perceived risks have an immense positive and strong influence on customers when it comes
to the issue of commitment towards the adoption of internet banking system within the
business activities of the organisation (Mukherje and Nath, 2003).
According to Mukherje and Nath (2003) other reasons why the customers use the internet
banking system within the organisation may be as a result of the perceived usefulness and
perceived ease of use of such transactions. This simply means that one ones trust in an online
firm may not be derived only from prior familiarity with the firm, but also from calculative,
institutional and identification together with the beliefs about the firm. At the same time it is
28
can be said that the most important factor that encourages the use of internet banking among
the customers can be said to be as a result of the lower fees and improved levels of service,
i.e. error-free-service. Other reasons why the users feel reluctant towards the use of internet
banking services were concerns over security and lack of awareness programmes offered by
the bank in terms of how best to use the internet banking together with their complex banking
sites (Mukherje and Nath, 2003)
CONCLUSION OF LITERATURE REVIEW
Having examined this chapter it can be said that the internet banking system offers a lot of
advantages to its customers such as its ability to save time and its convenience in terms of
transacting business and checking of account balance. At the same time it can be criticised
because of the fact that the use of internet banking has certain systems requirements such as
accessibility to computers, computer type, screen resolution, browsers and memory which
serves as an additional cost to the costs already incurred by the customer. On the other hand it
can be said that the issue of costs continue to be the main problem of internet banking
because of the fact that the customers are scared of using their information online. Among the
reasons for customers lack of trust on internet banking; it can be said that the three main
reasons on why customers frequently do not trust internet banking system or technology
include the issue that has to do with the security of the system, distrust of service providers
and worries about the reliability of internet services
CHAPTER THREE
RESEARCH METHODOLOGY
According to Dane (1990) the term research methodology aims at investigating and stating
the way and manner used by researcher in terms of conducting a research on a particular
29
subject in order to discover or revise facts, its application and the relevant academic theories.
This simply implies that the primary objective of research methodology is to investigate or
discover important information and the way the research will be conducted on a particular are
of study. In addition it is also important to note that research methodology is an enquiry that
goes beyond generally available knowledge with the aim of providing a basis for analysing
comment on the topic of enquiry.
The term methodology refers to the philosophical basis on which the research is founded
whereas on the other hand methods simply refers to particular techniques used by the
researcher in the process of collecting data and useful information when conducting an
academic research (Johnson, 1994). The research have looked at the different factors
affecting the use of internet banking amongst customers of First bank Nigeria plc in order to
understand the best ways of rendering its services to its stakeholders
PURPOSE
The primary purpose of this chapter is to analyse and present the research design, sampling
and the methods together with the way by which the data has been analyzed and presented in
the process of conducting this research.
RESEARCH METHOD
The term research method refers to the particular techniques used by the researcher to collect
data and information in the process of conducting a research. It can also be said that academic
research are conducted for different reasons and purposes; in order to achieve this different
30
research methods are used and they include exploratory, descriptive, analytical or predictive
research (Saunders et al, 1997). As stated by Dane (1990) the term analytical research aims at
analysing a particular topic in such a way that a balanced idea will be stated on the topic
under discussion.
It starts by stating the advantages and the disadvantages of a given topic in such a way that
the organisation will understand benefits and the disadvantages involved in terms of
introducing the use of internet banking within its business units. It is also important to note
that analytical research have been used in the process of conducting this study in order to
understand the factors the customers of First bank Nigeria plc while using the internet
banking and this method was chosen because of the fact that it offers a balanced view on a
particular topic and at the same time have helped the research to confirm the patterns, facts
and principles (Burns, 2000).
RESEARCH DESIGN
The term research design aims at covering a number of separate, but related issues associated
with the research. This includes the main purpose of conducting the research, data collection
techniques, final selection of the appropriate methodology, data analysis and interpretation
together with the way and manner by which all this fits in with the literature (Gill and
Johnson, 1997).
RESEARCH DESIGN PROCESS
PLANNING PROCESS
31
1. Gather Requirements
2. Finalize Objectives
3. Choose Methodologies
1. Gather Requirements
2. Finalize Objectives
3. Choose Methodologies
EXPLORATORY RESEARCH
QUANTITATIVE RESEARCH
Source: (adapted from Creswell, 1994)
A quantitative approach have been used in the process of conducting this study and the
various concepts that was raised earlier in the introduction and literature review acted as a
guide to data collection. The choice of a quantitative approach is due to the fact that the
concepts being investigated in this study have already been dealt with before hence this
research is not seeking to build up a theory as would be the case with a qualitative approach
(Bryman and Bell, 2007). It can also be said that another reason for using questionnaire is
because of the fact that the intended participants in study have been more disposed to
completing questionnaires for a few minutes than taking part in an interview which will be
the case if a qualitative research method is adopted.
This research has been divided into five chapters. The first delves into the background of the
study looking at issues pertaining to the topic and generally giving a broad overview of the
32
1. Explore Themes
2. Understand Problems & Issues
3. Identify Key Factors
1. Explore Themes
2. Understand Problems & Issues
3. Identify Key Factors
1. Develop Questions for Testing
2. Define Factors and Variables
3. Execute Study & Measure Results
1. Develop Questions for Testing
2. Define Factors and Variables
3. Execute Study & Measure Results
topic. It also spells out the specific aim of the dissertation. It highlights the significance of the
study thereby justifying the need to carry out the study. The first chapter gives an insight into
the research organization and lists out specific objectives of the study. The second chapter
reviews previous works with detailed analysis with the aim identifying various factors that
have been previously found to affect the use of internet banking thereby helping to tailor the
this research.
The third chapter deals with the methodology, here the various methods available for research
are looked at highlighting their advantages and disadvantages, the specific method used in the
study is identified and the reasons for this are spelt out. The fourth chapter presents the data
obtained in the study followed by analysis such data keeping in view the objectives initially
set out. The fifth and final chapter talks about the conclusions drawn from the results and
proffers solutions in the form of recommendations to the study organization. Limitations
encountered will also be discussed here also avenues for further improvement on the topic
area in form of future research have been highlighted.
SOURCES AND TYPES OF DATA
It is important to note that the two sources and types of data include primary data and
secondary data and they are explained below as follows:
PRIMARY AND SECONDARY RESEARCH
33
Primary Data Collected by Observation,
Interview, Focus Group, Survey
Secondary Data in the form of Records
left by People of their Activities
PRIMARY RESEARCH
PRIMARY RESEARCH
Source: (Adapted from White, 1991)
PRIMARY RESEARCH
As stated by White (1991) the term primary research simply the act of getting original
information directly from the people about a giving issue through the process of conducting
interviews, distributing questionnaires and observation. It deals with producing first hand
information directly from the people concerned in the study; and it is important to note that
this information have not been utilized before in terms of conducting any academic research.
It can also be called a field research because of the fact that this type of research involves
field work and the information collected in this type of research is used for a particular
purpose (Preece, 1994).
In this study the primary research have been conducted with the use of questionnaires which
were distributed to the customers of First bank Nigeria plc in order to be able to determine
the factors that affect them when using the internet banking as a form of transacting their
financial transactions. It is also important to note that a total of 100 questionnaires were
distributed by the researcher to the customers of First bank Nigeria plc in December 2011
while on holiday in Nigeria. Out of 100 questionnaires that were distributed among the
34
Secondary Data Collected with a
Particular Research Design
Secondary Literature which Critically
Analyses Data
SECONDARY RESEARCH
SECONDARY RESEARCH
organisation customers a total of 89 of the respondents completed and returned their
questionnaire to the researcher.
As stated by Thietart (2001) primary research can be said to be the most effective way of
conducting a research because of the fact that it helps the researcher to come up with a
firsthand information that have not been used in conducting any research. On the other hand
it can also be criticised because of the fact that it is expensive and time consuming in terms of
using this type of research (Morgan and Kruger, 1998).
Advantages of Primary Research
The main advantages of primary research is that this type of research is made up of up to date
information gained through interviewing the individual concerned directly; and at the same
time it can also be said that this type of research allows the researcher to be able to collect
important information needed to conduct a particular research. At the same time it can also be
said that primary research is used to obtain firsthand information that has not been used
anywhere else before in the process of conducting any research.
Disadvantages of Primary Research
The disadvantages of secondary research include the fact that this type of research is very
expensive to conduct when compared to the secondary type of research. It can be said that
conducting primary research is capital intensive and needs a lot of capital to conduct. At the
same time it can also be said that the processes involved in conducting a primary research is
time consuming and in some occasions may not yield into any useful result
SECONDARY RESEARCH
35
As stated by Churchill (1995) the term secondary research simply means a type of research
that already exists and can be conducted quite quickly without the need of carrying out a
primary research. It makes use of second hand or available information on a particular topic
or subject and it is a type of information where the information can easily be collected from
the desk and at the same time it can also be said to be the easy way of conducting a research
because of the fact that little or no money is spent in terms of collecting the relevant
information needed for the research.
It can also be said that secondary research is mainly concerned with gathering of information
which has already been collected and at the same time it is more concerned with identifying
relevant data before time and money are spent on new research which may result in
duplication (Bannister et al, 1994). A typical example of secondary data includes company
reports, articles, academic journals, published market research reports, publications in
libraries together with trend data (Sharp and Howard, 1996). The secondary research have
also been used in the process of conducting this research and it was used to access
information relating to the research that has already been published in the form of records,
government data, information from organisation websites on their internet banking (Crainer,
1996).
Advantages of Secondary Research
It is important to note that secondary research is easy to conduct when compared to primary
research because of the fact that it makes use of existing or available information on a given
topic. At the same time it can also be said that in the process of conducting a secondary
36
research the researcher benefits immensely from the work and research conducted by top
academicians.
Disadvantages of Secondary Research
One of the main advantages of secondary research is that it relies much on already existing
information which may not be up to date with the present conditions of life. At the same time
it can also be said that the information gained from this type of research may be misleading
and in some cases may not be relied upon by the researcher or the organisation in making
their decisions.
DATA COLLECTION TOOLS
The use of questionnaire have been used as the data collection tool in order to be able to get
the opinions of the customers of First bank Nigeria plc on the factors that affects them in
terms of using the organisation internet banking facilities. A total of 100 questionnaires was
distributed among First bank Nigeria plc customers; and 89 respondents completed and
returned their questionnaire. The questionnaires were primarily aimed at identifying the
factors that affects customers in terms of using internet baking within the organisation. At the
same time the secondary type of research have been used by the researcher to access
published information relating to internet banking in the form of journals and publications
(Crainer, 1996)
DATA COLLECTION TOOLS
The data collection tools are made up of sampling techniques and methods and they include
the following listed blow as follows:
37
SAMPLE TECHNIQUES AND METHODS
As stated by Gill and Johnson (1991) the term sample simply means a portion or segment of
the population selected or set aside for the purpose of investigation. It is very useful in
research because of the fact that it helps the researcher to save time and money. It is virtually
impossible to investigate every sample unit of the population because of the fact that the
number of units is limited (Zikmund, 1994). As stated by Greenfield (1996) the two main
types of sampling techniques includes the probability sampling and non probability sampling
PROBABILITY AND NON PROBABILITY SAMPLING
Source: (Adapted from Kennedy, 1993)
PROBABILITY SAMPLING
According to Kennedy (1993) the term probability sampling is mainly used in conducting
academic research and at the same time works best with a very accurate and up to date
38
SAMPLING TECHNIQU
NON PROBABILITY
PROBABILITY
SNOWBALL
RANDOM
SYSTEMATIC
STRATIFIEDDISPROPORTIONATE
PROPORTIONATE
QUOTA
JUDGEMENTAL
CLUSTER
CONVENIENCE
sampling frame. It is said to be the preferred method when carrying out any form of statistical
analysis; in terms of random sampling every sampling unit or member of the population has
an equal chance of being selected. In this type of sampling each member of the sampling
frame is given a number starting at 0 and the sample is selected using either random number
tables or numbers generated through the use of calculator or computer (Gill and Johnson,
1991).
The probability sampling is made up of random sampling, systematic sampling and stratified
sampling. In terms of this research probability sampling was employed because of the fact
that it is best suited for academic research. The non probability sampling on the other hand
has not been used because of the fact that some of the techniques are not necessarily suited
for conducting a dissertation (White, 2009).
Random Sampling
As stated by Balnaves and Caputi (2001) the term random sampling involves a type of
sampling where the required sampling is chosen from the sample frame by selecting the
numbers as previously described. This type of sampling techniques can be said to be good
especially where the sampling frame is not too large and each unit is easily accessible. It is
often used in selecting a stipulated number of records from a computer and it is used when
the population is very small and the sample is below 500 people (Mason, 1996). The random
type of sampling have been used in the process of conducting this research because of the fact
that the total number of questionnaire that was distributed in the process of conducting this
research is only 100 in number which is less than 500 questionnaires. In addition another
reason for using for using the random sampling method is because of the fact that the frame is
not too large and each unit is easily accessible.
39
Systematic Sampling
According to Robson (1993) a systematic sampling is the simplest method of sampling when
compared to the random sampling. This is because of the fact that the random sampling can
be said to be difficult and awkward and at the same time it can also be said that the use of
systematic sampling can be used in the place of random sampling. The systematic sampling
was used in the process of conducting this research because of the fact that a selection of First
bank Nigeria plc customers was selected from the population.
Stratified Sampling
According to Holliday (2001) the term stratified sampling is the most commonly used type of
research because it reduces sampling error and allows the researcher to be able to identify and
discover the relevant stratums and their actual representation in the population. While
conducting this research the population was spilt into layers or strata which in reality are very
different from one another. Examples of strata that were considered while conducting this
research includes age groups, gender, occupations and income level of respondents. The
stratified sampling was used conducting this research firstly to create the scope before the
random or systematic sampling was employed. One of the main reasons for using the
stratified sampling was because of the fact that it helped the researcher to reduce sampling
error and at the same time allowed the researcher to identify the relevant stratums and their
actual representation within the population (Armstrong, 1986).
NON PROBABILITY SAMPLING
As stated by Silverman (1999) the term non probability sampling refers to a sample that has
not been selected using random selection method and this implies that some units in the
40
population are more likely to be selected than the others. It can be said that non probability
sampling members are selected from the population in some non random manner and the
common form of this selection occurs by accident when the researcher inappropriately
introduces non randomness into the sample selection process. A typical example of non
probability sampling include quota sampling, snowball sampling, convenience sampling and
judgment sampling (Blaxter et al, 1996)
Convenience Sampling
As stated by Hoffman (1996) the term convenience sampling is a type of sampling method
used by the researcher in the process of conducting a research where the researcher hopes on
getting an inexpensive approximation of the truth. It is a type of research sampling that is
used by the researcher because of the fact that it is convenient and to incur the cost or time
required to select a random sample
Judgment Sampling
According to Johnson (1994) the term judgment sampling is used by the researcher to select
the sample based on judgment and when using this method the researcher must be confident
that the chosen sample is truly representative of the entire population. Judgment sampling
was used in conducting this research because the factors that affect first bank Nigeria plc
customers in terms of internet banking differs from individual to another.
Quota Sampling
According to Denscombe (1998) the term quota sampling simply means a type of sampling
method that is used by the researcher when conducting street interviews and when dealing
with market research surveys. In this type of research the population is divided into groups 41
based on age, gender and income level. In this type of research the research starts by
identifying the stratums and their proportions as they are presented in the population; at the
same time it is used to select the required number of subjects from each stratum and can also
be said to be like stratified sampling
Snowball Sampling
As stated by Parsons (1976) the snowball sampling relies on referrals from initial subjects in
order to be able to generate additional subjects. It is important to note that this type of
sampling makes it difficult sometimes for the researcher to be able to locate respondents
because it introduces bias into the research. At the same time it can also be said that snowball
sampling introduces the likelihood that the sample will represent a good cross section from
the population
DATA ANALYSIS METHOD
Data analysis method is divided into two and they include quantitative and qualitative
research and they include the following:
QUALITATIVE AND QUANTITIVE RESEACRH
42
QUALITATIVE QUANTITATIVE
Conceptual Concerned with understanding Concerned with discovering
Human behaviour from the facts about social phenomena
Informant’s perspective
Assumes dynamic and assumes a fixed and measurable
Negotiated reality Measurable reality
Methodological Data are collected through Data are collected through
Participant observation and measuring things
Interviews
Data are analysed by themes Data are analysed through numerical
From descriptions by informants comparisons and statistical inferences
Data are reported in the language Data are reported through statistical
Of the informant analyses
Source: (Adapted from Creswell, 1997)
QUANTITATIVE RESEARCH
As stated by Creswell (1997) the term quantitative research simply means a type of research
that involves an objective way of studying things in which its results are given in numerical
values. Quantitative research involves the use of statistics in order to properly analyse the
results and findings of the research. Its main objective is to study the ways by which things
are done within the organisation and is normally used by marketers in their day to day
activities of carrying out experiments and surveys. Quantitative research is always conducted
with the use of questionnaires and interviews; the use of numerical value is used to present
the responses of the respondents.
A quantitative approach have been used in the process of conducting this study and the
various concepts that was raised earlier in the introduction and literature review acted as a
43
guide to data collection. The choice of a quantitative approach is due to the fact that the
concepts being investigated in this study have already been dealt with before hence this
research is not seeking to build up a theory as would be the case with a qualitative approach
(Bryman and Bell, 2007). It can also be said that another reason for using questionnaire is
because of the fact that the intended participants in study have been more disposed to
completing questionnaires for a few minutes than taking part in an interview which will be
the case if a qualitative research method is adopted.
QUALITATIVE RESEARCH
As stated by Denzin (2000) the term qualitative research is a type of research that is based on
exploratory research. In this type of research data is usually collected in the form of
descriptions and a typical example of qualitative research includes, interview, observation,
focus group, diaries, case study and action research. It is also important to note that this
research is a quantitative research because it made use questionnaires and not a qualitative
research
RESEARCH POPULATION
The research population comprises of 100 questionnaire distributed among First Bank
Nigeria plc customers in which 89 respondents completed their questionnaire and returned it
back to the researcher. The population was chosen from First Bank Nigeria plc customers
who are directly affected by the organization internet banking system
DATA ANALYSIS AND PRESENTATION
The data collected in the process of conducting this research were presented with the use of
Microsoft office excel, Microsoft word and at the same time the results were analyzed using,
diagrams, tables and bar charts for easy understanding
44
RELIABILITY
As stated by Easterby-Smith et al (1991) the term reliability simply means the consistent
nature of an instrument each time it is used under the same state with the same subjects. It is
important to note that the several issues that may serve as a threat to reliability of this
research includes participant error and human error
VALIDITY
According to Walliman (2000) the term validity simply means the strength of the research
which includes its propositions and conclusions. It involves some threat that can threaten the
validity of the research which includes internal validity threat, instrumental threat, maturity
validity threat and external validity threats
LIMITATIONS OF THE RESEARCH
In process of conducting this research a lot of factors acted as a limitation to the research and
this has gone a long way in terms of affecting the credibility and reliability of the research.
Stated below are some of the limitations encountered in the process of conducting this
research and they include the following:
The study failed to investigate the factors that affect the customers using internet banking in
other banks in Nigeria and only concentrated in First Bank Nigeria plc; based on this fact the
research can be criticized based on the fact that it failed to represent the wider view of the
views of all the customers.
The random sampling type used in the process of conducting this research cannot be used for
statistical generalization of the research results because its responses are chosen randomly
from different customers of First Bank Nigeria plc
45
It can also be said that the time used in conducting this research was not enough to be able to
gather enough information relating to this research
The funds available to the researcher was inadequate and this made it difficult to employ the
use of other methods of collecting data such as interviews or the ability o reach a large
audience
It can also be said that a large number of the respondents were young people which attributed
to the fact that most accessible demographic group in terms of possible respondents were
students. This is because of the fact that the most effective advertising options was targeted at
students; this to a large extent however limit the variety of results and thus the value of the
scope of the findings
ETHICAL ISSUES
According Churchill (1995) the term ethics implies the moral principles and values that
govern the way an individual or group conducts its activities. Some of the ethics observed in
the process of conducting this research includes the following:
The respondents of the questionnaires briefed about the purpose of the research
At the same time the respondents was not by any means forced or persuaded to participate in
the research without their individual consent
The participants in this research was never in any way induced to do things which could
destroy their self esteem or self determination
In the process of conducting this research all publications and materials and materials used
was quoted and references systematically
46
The research results was used ethically for the benefit of the organization with complete
confidentiality and informed consent of respective authorities
At the same time it is also important to note that the participant right to privacy was respected
and at the same time their anonymity and confidentiality was also guaranteed and maintained
in the process of conducting this research
CONCLUSION OF THE RESEARCH METHODOLOGY
Having evaluated the methods and strategies employed in carrying out this research; it can be
said that that the research made use of primary research in terms of getting its firsthand
information from the customers of First Bank Nigeria plc. This was achieved with the use of
100 questionnaires that was distributed among the banks customers in its headquarters in
Lagos Nigeria. It can also be said that in terms of the sampling methods; the probability
sampling was employed and among this sampling method the random and the stratified
sampling was used in the process of conducting this research.
The random and stratified sampling was also adopted; and the main reason for adopting a
random sampling is because of the fact that the number of questionnaires distributed among
First Bank Nigeria plc employees is less than 500 in number. On the other hand the stratified
sampling was also used to reduce sampling error by allowing the researchers to identify the
relevant stratums and their representations within the population. A quantitative approach
have been used in the process of conducting this study and the various concepts that was
raised earlier in the introduction and literature review acted as a guide to data collection.
The choice of a quantitative approach is due to the fact that the concepts being investigated in
this study have already been dealt with before hence this research is not seeking to build up a
theory as would be the case with a qualitative approach. It can also be said that another
47
reason for using questionnaire is because of the fact that the intended participants in study
have been more disposed to completing questionnaires for a few minutes than taking part in
an interview which will be the case if a qualitative research method is adopted
CHAPTER FOUR
FINDINGS OF THE RESEARCH
Stated below are the findings of the research and they include the following:
48
PURPOSE
The purpose of this chapter is be able to find out the factors to affects customers of First Bank
Nigeria plc as relates to the introduction of internet banking system into the organization.
FINDINGS
The findings of this research is based on the 89 questionnaires that was completed and
returned by First Bank Nigeria plc customers out of 100 questionnaires distributed in their
headquarters in Lagos Nigeria
1.Gender of Respondents
In terms of the gender of respondents Out of the 89 completed questionnaires that was
returned by the customers of First Bank Nigeria plc; 55% of the respondents are Male
whereas 45% of the respondents are Female. This simply means that the number of men that
make use of internet banking are more than their femal counterpats. As a result of this it can
be argued that the main counterparts are more concerned about their transactions and the
movement if their finances when compared to their female counterparts.
2. Age Bracket of Respondents
49
In terms of the age brackets of the respondents it can be said that the younger generations
ranging from the age of 18 to 25 years of age are the ones that really makes use of the internet
banking system. Judging from the findings of this research 25 customers of First bank
Nigeria plc within the ages of 18 to 25 particpated in completing the questionnaire followed
by 20 customers within the ages of 26 and 35 yrs of age.
On the other 15 customers within the ages of 36 and 45 partcipated in the research; 19
customers within the ages of 46 and 55 participated in completing the research whereas 10
customers within the ages of 56 yrs and above also participated in completing the
questionnaire. This simply means that the people who normally use the internet banking
within the Nigerian banking system are mainly the younger gernerations within the ages of 18
and 25 yrs. It can be said to be as a result of the fact that they are the interent generation who
continues to learn about the new ways of doing things online when compared to the older
genration.
3. Status of Respondence
50
Among the respondents to the questionnaire 29 single customers of First bank Nigeria plc
participated in the research; on the other hand 25 customers of the bank that participated in
the research are married. At the same time 20 respondents to the research who are also
customers of the bank are 20 in number whereas 15 customers are widowed. This simply
implies that the single people which includes the young generation within the ages of 18 and
25 yrs of age continue to be the ones spearheading the issues of interent banking within the
organisation. It can also be said that another reason why the single customers are still more in
number when compared other individuals may be as a reault of the fact that they have lesser
commitments when compared to their married counterparts.
4. Level of Education of the Respondents
Among the number respondents that participated in the process of conducting the research;
the number of customers with tertiary education is more in number when compard to the
customers with secondary or no education at all. This simply means that education is very
51
important for customers who want to use the internet banking system. It is also important to
note that the number of people with tertiary education are more of the young people within
the ages of 18 and 25 years of age. It can be said that education is one f the factors that was
has affected customers using the internet banking in First bank Nigeria plc
5. Average Monthly Income of the Respondents (Equivalent in Pounds)
Looking at the income level of the customers of First bank Nigeria plc it can be said that the
number of people that earn less than £500 per month are more in number when compared to
those that earn £2000 and above. This simply means that the customers of this bank are more
of low income earners in terms of their monthly income. It is also important to consider the
fact that the research was conducted on a Nigerian bank where the customers work and earn
their wages and salaries on the local currencies.
6. How Would You Describe your Knowledge of Computer
52
Among the respondents to the questionnaire which are the customers of First bank Nigeria
plc; majority of the respondents are good with prior experience of computer. At the same
time it can also be said that a reasonable number of customers of the bank have a very good
knowledge of computer together with a reasonable number of customers having fairly good
knowledge of computer. This simply means that the awareness on computer literacy within th
country has continued to gather momentum on a daily basis among the customers of First
bank Nigeria plc.
7. How often do you use the internet
In terms of how often the customers of First bank Nigeria plc makes use of the internet
banking; it is important to note that the majority of the customers uses the internet on a
weekly basis. This is followed by customers that uses the internet on a daily basis and on a
monthly basis. The figure above represents an idea of how often the customers of the bank
53
makes use of the internet banking; and this means that the people makes use of the internet
baking system more on a weekly and daily basis when compare to other people that use the
internet banking on montrhly and yearly basis.
8. How Easy is it for you to navigate the internet
In terms of the bank website majority of the customers thinks is easy to navigate in terms of
its internet banking system. On the other hand reasonable number of the respondents thinks
that is fairly easy to navigate through the website of First bank Nigeria plc when compared to
other banks website in Nigeria. This simply means that the organisation are currently doing
very well in in its informatrion technology system but on the other hand needs to improve in
its interent banking system in order to be able to compete with its counterparts in the
developed economies of the world
9. Are you Aware that your Bank offers Internet Services
54
It is also interesting to see that among the customers of First bank Nigeria plc the number of
people who are not aware of the banks internet services are more in number when compared
to the number of customers who are aware of the internet services offered by the bank. This
simply means that the bank needs to go into more awareness programs in terms of promoting
its business and the services it offers to its customers. It is belived that the ability of the bank
to create awareness of its services will lead to a situation where almost all of its customers are
aware of the services they offer within their organisation.
10. Do You Use Internet Banking
At the same time looking at the number of First bank customers that use internet banking
within the organisation; it can be said that the number of customers who makes use of the
internet banking within the organisation are less in number when compared to the number of
customers who does make use of the internet banking within the organisation. This simply
55
means that the organisation needs to create more awareness by promoting the services it
offers to its customers.
11. Reasons for Not Using the Interent Banking
Looking at the reasons on why the customers of First bank Nigeria plc shy away from using
the internet banking system; it can be said that one of the major reasons for this is the
inability of the organisation to offer security in terms of its customers. Others includes
inadequate knwledege about the use of internet, unreliable internet access, the need for face
interaction and difficulty in navigating the site. This simply means that the organisation
should try as much as possible to restore trust on the part of its customers in terms of its
interent banking system.
12. Facilities used by Customers
56
In terms of the facilities the customers of First bank Nigeria plc use within the organisation; it
can be said that majority of the customers uses the internet banking system mainly for
balance inquiry and funds transfer. Whereas as on the other hand othe customers uses the
internet banking for bill payment and loan application. This simply means that the main
reason why the customers of the bank use internet banking is for the main objective of
inquiring about their balance
13.Factors affecting the use of Internet banking
57
Factors Issues Ratings
Accessibilty Internet access and internet connection speed 20
Reluctance Willingness to adopt technology enhancement 2
Level of awareness of current trends
Attitudes towards change
Costs Cost of computers 3
Cost of Internet connection
Trust in ones Bank Banks reliability in correcting erroneous transactions 5
Trust in the bank to compensate for losses due to secuirty
Infringements
Banks response rate to queries
Security Concerns Clear and understandable instructions 29
Security of internet transactions
Length of internet experience
Convenience Time saving & convenient way of doing bank transactions 15
Ease of Use Ease of performing internet banking transactions 15
Ease of navigation in the bank websites
Among the factors that affect internet banking in the Nigeria banking industry it can be said
that the issue of security in terms of the security of internet transactions, length of internet
experience and lear understanding instructions of the websit continue to be the main factor
affecting the use of internet banking in Nigeria banking institutions. Apart from that internet
banking is also faced with the issue of accessiblity problems such as issues with its
accesseibility and interenet speed. On the other other hand one of the major factors affecting
58
the use of internet banking among the customers is for the fact that the system is easy to use
when compared to the traditional way of banking togther with the convenience it provides for
the customers.
CONCLUSION OF THE FINDINGS
Having examined the topic under investigation , it can be said that the factors that affect
customers of First bank Nigeria plc in terms internet banking can be said to be as result of the
secuirty concerns, accessibility of the organisation websites, convenience of the system, ease
of use, the costs involved in using the internet banking, reluctance and the trust the customers
have on the institution.
59
CHAPTER FIVE
DISCUSSION OF THE FINDINGS
Stated below are the full discussion and analysis of the findings and it includes the following
stated below:
PURPOSE
The main objective of this chapter is to discuss the findings of the research and at the same
time critically analyze its implications to the research
DIFFFERENCES IN DEMOGRAPHIC FEATURES
Among the group of people that makes use of the internet banking it can be said that the main
users of internet banking within the organization are the younger generation within the ages
of 18 and 25 years of age. This simply means that this generation of users is the internet
generation that is always busy researching one or two things on the internet. Another reason
for the large number of young people that makes use of the internet banking can be said to be
as a result of the fact that most of them are presently undergraduates or graduates in different
institutions of study. The availability of internet facilities in their different institutions of
study or workplaces makes it possible for them to be able to have access to the use of internet
banking.
It is also important to note that this research is in accordance with Howcroft et al (2002)
study on differences in demographic features in which they revealed that younger customers
value convenience or time saving potential of online and mobile banking more than the older
customers. It also concluded that the younger customer regard the lack of face-to-face contact
as less important than older consumers. But it is also important to note that this research beg
60
to differ in the area of education in which they stated that the educational levels or
qualifications of the customers did not affect the use of internet banking within the
organization. This research to a large extent believes that the educational levels of the
customers affects the use of internet banking services among the customers. As a result of
this the research is in agreement with Sarel and Marmorstein (2003a, b) study in which they
stated that household income and education has a significant effect on the adoption of internet
banking within organisations.
In terms of this research when the number of customers that makes use of the internet
banking are been compared with the number of people who don’t make use the service; it was
revealed that the number of people that makes use of the internet banking facilities are less in
number when compared to the number of who don’t make use of the service. As a result of
this the research is in agreement that the organization should invest more resources into
promoting and educating its customers on the importance and the benefits of using the
internet banking system in transacting their individual businesses. This is in accordance with
the views of Sathye (1999) in which they stated that the organization should spend more
resources in terms of organizing and workshops for their customers on the need and
importance associated with internet banking when transacting their individual businesses.
THE ISSUE OF TRUST & SECURITY ON INTERNET BANKING
One of the main factors affecting internet banking is the issue of trust and security in terms of
its ability to secure and preserve the personal information of the customers. The issue trust
and the security of the website when compared with other factors that affects the internet
banking system such as problems of accessibility and navigation of the websites; it can be
said that the customers emphasized more on the issue of trust than other factors. This simply
61
implies that opportunities from implementing internet banking or Web technologies could be
restricted if there is a lack of customer trust in the Web system.
This research is in accordance with the views of Hoy and Tarter (2004) in which they sated
that the other should try and restore trust and confidence on its customers by implementing
customer protection laws within its organization. It can be said that one of the most frequent
attributes of trust is based on the fact that trust is a psychological state comprising the
intention to accept vulnerability based upon expectations of the intention or behaviour of
another under conditions of risk and interdependence (Van and Sniezek, 2005). This simply
means that the term trust is a psychological state in terms of beliefs and positive expectations
with positive or non negative outcomes that requires the consent of other members and
developed under uncertain, risk and interdependence (Rousseau, 1998; Bhattacharya et al.,
1998).
The research also came up with the conclusions that the organisation should try and take the
necessary steps that will help in restoring the confidence of the customers in terms of using
the internet banking facilities. This opinion is in agreement with the views and suggestions of
Moorman et al (2003) in which they stated that the ability of the organization to guarantee the
trust of the customer will help to restore and guarantee the confidence and trust of the
customers in the internet banking system of the organisation. As a result of this for
organisation hoping to compete favourably within its industry; its internet banking system
must be built in such a way that it guarantees the trust and confidence of its customers this is
believe will help the organisation to stand out in its business activities and at the same time
help them to achieve their objectives.
62
The research came to the realisation of the fact that internet banking in the Nigerian banking
sector is faced with the issue of trust and security. This is understandable considering the fact
that the Nigerian banking industry is a sector that is still at its development stages faced with
a lot of irregularities and improper ways of doing things within the organisation. As a result
of this the strong concern of the security of the internet banking system is one common factor
related to unwillingness to use internet channels for commerce (Black et al, 2001).
The main reason why the customers are not interested in using the internet banking can be
said to be as a result of the security breaches on internet banking system which can bring
about numerous problems ranging from disruption of information access and destruction of
operating systems. This is in accordance with the views of Black et al (2001) in which he
stated that poor security system on the internet banking system brings about lack of trust on
the part of the customers and at the same time increases the level of risk in terms of using the
Web for financial transactions. At the same time it is important to note that reputation is
important, as distrust of the service provider is a related factor.
One of the major ways of restoring the confidence of the customer is the ability of the
organisation to build a good reputation among its customers; this is believed will help in
restoring the confidence of the customers and at the same time go a long way in terms of
encouraging them to make use of the internet banking services within the organisation. This
is accordance with the survey carried by Jarvenpaa et al (2002) in which they stated that the
reputation of banking institutions such as first bank Nigeria plc goes a long way in terms of
assuring the safety of the customers; at the same time it helps to restore confidence on the
customers and at the same time guarantee the honesty and integrity of the organisation. As a
result of this for organisations such as First Bank Nigeria plc to function effectively within its
business environment must be able to have experience in business functions, policy and at the
63
same time be able to support the personnel to build reputation as a competent technology-
based service provider for the organisation.
The advantages of building of building a good reputation are numerous and they include the
fact that it brings more customers to the organisation and helps them to compete effectively
within its sector. This view is in agreement with the views of Aladwani (2002) in which he
stated that a good reputation helps organisations to gain the trust of their customers and is
said to be one of the major factors that affect customer adoption of new technology-based
service delivery. It can also be said that reputation depends largely on policy promises to
customers which includes privacy policy as most do not like their personal information
revealed in an inappropriate manner or misused by others over the internet (Turban et al.,
2002).
PRIOR KNOWLEDGE OF COMPUTER AND ITS EFFECT ON
INTERNET BANKING
From the findings of the research it can be seen that a good number of the customers have a
prior knowledge of the computer; and again judging from the number of people using the
internet banking which is lesser when compared to the amount of people who do not make
use of internet banking facilities. The significance of this is the fact that prior knowledge of
computer does make huge different in terms of the use of internet banking by the customers.
It is important to note that this research is in disagreement with the views of Karjaluoto et al
(2002) in which they stated that prior know of computers and technological equipments goes
a long way in terms of influencing the both the attitudes towards online banking and actual
behaviours. According to their study prior knowledge or experience of computer have an
important and significant impact in terms of the ability to use the internet banking system
64
within the banking industry. Apart from the fact that it helps the use of internet banking
system it also have a positive effect on both attitudes and satisfied customers tend to keep up
with their current delivery channel.
The research concluded that the main reason why the customers are dissatisfied with internet
banking is for the fact that it takes a lot of time transacts any business activities, is not
convenient for the customers and is an old fashion way of banking. This research is in
accordance with the views of Joseph and Stone (2003) in which they stated that the
traditional way of banking involves a slow speed of service in branches; and some of the
opening hours of the branches are sometimes inconvenient for the customers. At the same
time it can also be said that some of the branches are very small and the staff within this
organisation lacks the necessary manners in terms of attending to a customers. The general
attitudes of customers towards the use of internet banking is based on the fact that they are
faster way of transacting business activities within the bank, is cheaper and more service-
oriented when compared to the traditional way of banking.
EASE OF USE & HOW IT AFFECTS THE ADOPTION OF INTERENT
BANKING
In terms on how easy it is to carry out internet banking activities in the organization website;
it can be said that the website of First bank Nigeria plc was better in terms of accessibility
when compared to that of other banks within the country. As a result of this the number of
people that make use of internet banking within the organization has increased tremendously
in recent years when compared to 5 years ago when internet banking was newly introduced
into the organization. This is in agreement with the views of Durkin (2004) in which he stated
that the bank have experienced a tremendous improvement in terms of its accessibility; this is
because of the fact that the organizational website can be accessed on a day basis including 65
weekends. At the same time internet banking system transactions are executed and confirmed
almost immediately; and it allows the customers of the bank to do virtually everything
ranging from checking of an account balance to applying for a mortgage.
66
IMPLICATIONS FOR FUTURE RESEARCH
The model developed in this research needs to be tested both qualitatively and quantitatively;
and as a result of this an online questionnaire can be developed which can be distributed to a
larger number of First bank Nigeria customers and employees within the organization in
order to examine the efficacy of the model. As a result of this the views of the managers and
employees of the bank needs to be put into consideration and this can be achieved through a
combined use of interviews and distribution of large questionnaires which can be conducted
with the managers, employees and customers of the bank in Nigeria.
Finally a key element in the development of internet banking system in the Nigeria banking
industry will be to conduct a further research with the use of a larger sample size that will
discuss the issue the factors that influence the trust towards online vendor within the Nigeria
banking industry; there may be more factors; so it would be appropriate to extend this study
by developing a more extensive model of internet banking
67
CONCLUSION
Having examined the factors that affects customers in terms of internet banking; it can be
said that some of the factors include the problem of accessibility, security, lack of trust on the
organisation internet banking system and the cost involved in terms of using the services
offered by the bank. The term internet banking can be said to offer a lot of advantages to the
customers when compared with the traditional banking methods. And some of these
advantages can be said to include the fact that internet banking saves the time of the
customer. This is because internet banking helps the customer to be able to access its
individual accounts without the need of visiting the branch physically. It can also be said that
this system of banking is convenient for the customers because of the fact that an individual
account can be paid and funds transferred without the need of queuing at the bank or writing
cheques.
At the same time the use of internet banking can also be criticised because of the fact that the
use of internet banking has certain systems requirements such as accessibility to computers,
memory, screen resolution and browsers, which prove to be an additional cost to the customer
when compared to the traditional banking methods or other online banking services such as
the use of automated teller machines. In a country like Nigeria majority of First Bank Nigeria
plc have no access to their own personal computers and the use of the public computers
involves an additional cost to their limited available resources. At the same time it can be said
that the main users of internet banking within the organization are the younger generation.
And it can be said to be as a result of the fact that a large number of young people makes use
of the internet banking while in their different academic institutions and their workplaces. It
can also be said that the younger customers value convenience or time saving potential of
online and mobile banking more than the older customers.
68
In the Nigerian banking industry the number of people that makes use of internet banking is
smaller when compared to the numbers of people who don’t make use of internet. This is said
to be as a result of the fact that most of the customers are not aware of the internet banking
facilities offered by the bank. As a result of this the bank should try and invest more
resources into promoting and educating its customers on the importance and the benefits of
using the internet banking system in transacting their individual businesses.
One of the main factors affecting internet banking is the issue of trust and security in terms of
its ability to secure and preserve the personal information of the customers. As a result of this
the organization should try and protect their websites and their internet banking facilities
within its organization in such a way that it will encourage more customers to use the system.
This is because of the fact that one of the most frequent attributes of trust is based on the fact
that trust is a psychological state comprising the intention to accept vulnerability based upon
expectations of the intention or behaviour of another under conditions of risk and
interdependence.
The organisation should try and do everything within its power to be able to restore the
confidence of its customers in terms of using the internet banking facilities. This is because of
the fact that the ability of ability to guarantee the trust of the customer will help to restore and
guarantee the confidence and trust of the customers in the internet banking system of the
organisation. As a result of this for organisation hoping to compete favourably within its
industry; its internet banking system must be built in such a way that it guarantees the trust
and confidence of its customers this is believe will help the organisation to stand out in its
business activities and at the same time help them to achieve their objectives. And one of the
ways the organisation will use in restoring the confidence of the customers is by building a
good reputation among its customers; this is believed will help in restoring the confidence of
69
the customers and at the same time go a long way in terms of encouraging them to make use
of the internet banking services within the organisation.
It can also be said that a prior knowledge of computer does not really make any significant
difference in terms of the ability of the customer to make use of the internet banking services
within the organisation. At the same time it is important to note that the main reason for
customer dissatisfaction with the traditional way of banking is because of the fact that it takes
a lot of time transacts any business activities, is not convenient for the customers and is an
old fashion way of banking. The internet banking services of the organisation is better in
terms of its accessibility and as a result of this the number of people that make use of internet
banking within the organization has increased tremendously in recent years.
70
RECOMMENDATION
The recommendations of this study have been directed towards the organisation, the Nigeria
banking industry as a whole, the government and the website developers. This is done in
order for them to try and contribute their individual or group quota towards the growth and
development of internet banking system within the country. Stated below are the
recommendations for this study and they include the following:
This study strongly recommends that the software developers and engineers should
try and develop more user friendly software that is accessible and easy for those with
lack of internet expertise to navigate through. The research believes that the ability of
the developer to come up with a website that is easily accessible to the users and non
users of internet banking system; it will go a long way in terms of encouraging more
into the use of internet banking within the financial institution in which they operate.
At the same time it is also important to note that the complexity of internet banking
system might be reduced by adopting short of the technical adequacies of the website.
This include appropriate information, easy of navigation, security, personalization and
loading speed of the internet
The research also recommends that the government should try and assume for roles in
terms of creating awareness of internet banking to the people within the country. This
will be achieved by focusing on the benefits and advantages derived from the use of
internet banking within the organisation in which the customer operates.
At the same time those policies that will protect the consumers privacy rights of the
customers need to be passed into law; in order to help ensure that the information and
right of the customers are been protected within the organisation
71
At the same time organisations such as First bank Nigeria plc should try and create
awareness on its internet banking services to its customers by focussing on the
importance and the benefits of the system. In terms of innovation attributes such as
complexity, compatibility and relative advantages the organisation should try and
concentrate on factors that enhance aspects of each one of the attributes.
The banking industry in Nigeria should also try to implement policies that will be
aimed at restoring the trust of the customers thereby rendering a solution to the issue
of security in terms of internet banking. This should be achieved through an over
hauling of the banking industry in order to maintain stability, transparency and
accountability within the banking sector
72
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