PROBLEMS AND PROSPECT OF ELECTRONIC BANKING IN NIGERIA

BACKGROUND OF THE STUDY: Financial institutions have been early adopters of smart card and credit cards technology, in the system and more recently, the launching of internet banking have transformed the world into a global village linked with electronic impulses. The idea or when the Apex Bank of Nigeria (Central Bank of Nigeria) gave the approval to all states. Trust Bank Limited to issue a financial product known as the ESCA an electronic purse to the public. Later on, Diamond Bank Limited, introduced a parallel product know as Diamond pay card.  In February 1998 the smart card received a boost, when 19 licensed banks floated a smart card company. Although a lot of research works have been done on the prospects and challenges of information. Technologies in the banking industry, these research works are broad based (E-banking). Opera etal, (2010), posits that, modern banks now realize that  only those that overhaul their payment services delivery and operations are likely to survive and prosper in the 21st century.

Connel and Saleh (2004) are of the view that, due to pressure of globalization, consolidation, privatization, deregulation and rapidly changing technology, in order to properly place themselves in favorable positions for competitions and be one of those corporations, to be reckoned with in the new century, banks are making use of internet to executes mobile banking, this developed from bringing personal computer (PCS) together to form local and wide area network through client/server technology.

Many banks have installed modern computer interconnectivity that would enable them achieve communications of data and multimedia over internets, intranets and extranets. They also realize that they have to achieve not only management staff, wide computer literacy but what could be called information literacy i.e. knowing how to locate, analysis, store and use information. All staff and managers in a modern bank need to be able to search and gather data from several types of sources, analyze them, select relevant ones and organize them in such a manner to allow them make decisions based on the organized data, banks future realizes that the banking of nowadays requires more of electronic banking and shuffling and other banking transaction, instead of paper.

In other words, paper base transactions are now being replaced by electronic based transaction e.g. the internet. Whether a bank would be successful or not depend on the extent to which it is investing on IT and using it in an innovative manner. This area has been tipped to be a major competitive ground for banks that are operating in the post-consolidation era.