Empirical Determinants of Consumers’ Uptake of Electronic Banking in Selected States of Nigeria

Financial institutions have been adopting internet banking since the mid-90s, predominantly due to lower operating costs associated with electronic banking and pressure from non-banks interested in entering the electronic banking market. In addition, customers utilizing electronic banking facilities are increasing. This is due to the cost savings associated with transactions over the electronic platform. Internet banking enables speedy transactions, access, time and money savings through providing free paper, and complete and up-to date transactions. The competitive landscape of financial institutions is shifting as internet banking is no longer a competitive advantage but a competitive necessity for banks all over the world. While previous research works dwelt on wide range of issues relating to electronic banking issues, unfortunately, there is little empirical research on the effect of electronic channels on consumer's buying behaviour and banking channel preferences in Nigeria as a developing economy. This study examined consumers' decision-making between electronic banking and non-electronic banking in Nigeria. The research uses the consumer decision making process to identify factors that consumers use when deciding between electronic banking and non-electronic banking services. These factors include but not limited to service quality dimensions, service product characteristics, perceived risk factors, user skill factors, and price factors. The demographic variables include age, gender, marital status, ethnic background, educational qualification, employment, and income. Findings revealed a correlation between most of the above listed factors as some of the reasons for the poor adoption of electronic banking services in Nigeria as a developing economy