ArtsAutosBooksBusinessEducationEntertainmentFamilyFashionFoodGamesGenderHealthHolidaysHomeHubPagesPersonal FinancePetsPoliticsReligionSportsTechnologyTravel

Impact of Infotech in Nigeria Banking System

Updated on August 1, 2011

Impact of Infotech in Nigeria bBanking System



Owing to the voluminous work and the need to meet up with customers demand in the banking industry, most banks have developed and adopted the use of high-tech electronic devices such as computers for more efficient services. Computer plays a vital role in storage, analysis and retrieval of information within a twinkle of an eye.

Suffice it to say that electronic banking is the order of the day in most Nigeria banks today. Computerized banks quickly respond to customers who include; ascertainment of account balance, withdrawal or deposit of cash and other inquires. With the adequate of automatic teller machine (ATM), banks can also offer quicker services to their numerous customers outside the banking hall. Furthermore, online banking off the customers the opportunity to withdraw or deposit money from their accounts at any branch in Nigeria. The extend to which electronic have aided banks in satisfying their customers and at the same time enhance their profitability is another issue to be examined UBA (United Bank for Africa) plc has been chosen as a case study for the purpose of this assignment.


United Bank of Africa (UBA) plc is the West Africa’s largest banking and financial services group as measured by asset base, number of customers, branch network and profitability. It provides personal and commercial banking, wealth management, services, insurance, corporate and investment, banking and transaction processing services. The bank employs more than 170000 staff (core and support) who serves their over 6 million personal, business, public sector and institutional customers through their offices in Nigeria, Ghana, Cameroon, Cote d’Ivoire, New York, London and the Cayman Island.


UBA is the clear leader in the deployment of solutions across-electronic channels in West Africa. As at 30th September 2008, it has 1,256 ATMs, 3296 Pos machines deployed. Outside of Nigeria, they had a further 55 branches and 76 ATMS. During 2008, UBA processed 10% of the total value of all POS transactio0ns in Nigeria. It also pioneered the deployment of cherub deposit ATMs into Nigerian market.

UBA remains the only bank in Nigeria with a full electronic platform for payroll administration for corporate clients.

Going beyond payment of salaries, corporate organizations are given a convenient, secured electronic alternative to managing employees.

Some of the bank e-banking services include; U-Direct, U-mobile, Ems, Bank collect, Pay Direct, U-Pay, Sms/ E-mail Alerts, U-Dividend Monitor, E-dividend, Dubai Visa Solution, E-transact, Schools Online, Eduportal.


Owing to government stringent regulations of banking industry in Nigeria and the need to remain in business most banks have adopted various measures in order to remain in business while some have gone distress. After the N 25 billion capital based pronounced by the Central bank which saw the mergering , acquisition and take over of some banks by strong ones, UBA has remained in the business despite harsh economic condition in Nigeria today.

Why has UBA still remains a strong and reliable bank with a solid capital base?

Is it because of quick and efficient services rendered to their customers?

Why do customers prefer it to others?

Is it also as a result of high rate of profitability recorded over the years?


The purpose of the study includes the following:

  1. To determine whether information technology has enhanced banks profit.
  2. To determine whether information technology has led to increase in banks deposit.
  3. To determine whether information technology has led to enhanced customers satisfaction.
  4. To determine whether information technology has contribute to development and growth of banks.
  5. To determine the impact of information technology on bank deposits.


The concept of Computer technology and Internet system has transformed the entire universe into a global village. The banking industry should not be left out of the innovation in information technology for a more efficient management with the advent of computers, banks offers varieties of services which range from automatic teller machine, on-line or network services and automatic credit card services. All these services through the use of advanced information technological devices give the customers easy access to their money. Customers also have the opportunity of withdrawing or depositing money out or into their accounts anywhere in the world.

Moreover the study will be very useful to the banking sector and the Nigeria economy in general. This is because banks provide the bulk of the money in form of loan for medium and long term investment in any capitalist economy. Since it has been proved that with the introduction of

information technology in the operations of banks as well as prudent management or resources will result to the following:

  1. Enhance profitability
  2. Improved customers satisfaction
  3. Increase in customers deposit
  4. And rapid development and growth of the banking industry.

With all these points, the significance of information technology in the banking section could not be over-emphasized.




Information technology is a new trend in information management. Information technological devises encompasses the internet, computers, global system for mobile communication (GSM), word processors, automatic teller machines, on-line computer networking and so on.

Owing to the volume of work and customers which were often attended to manually by banks, in the past which most often leads to boredom ness and its attendant risk like: misinformation, haphazard work and fraud, also banks in order to be relevant and efficient under competitive environment needs the introduction of information technology in the routine operations.


It is very obvious that the new wave of technology doing virtually every activity in the world is information technology.

The convergence of computers and telecommunication after about four decades of applying computers to routine data processing, mainly information storage and retrieval has created a new development epoch where information has become the engine to economic growth in the world. This development is believed to have created catch-up opportunities for less developed countries to attain much higher level of development without necessarily passing through all the stages posture by the famous economists.

The developing economy as it is must not miss the opportunity as Shakespeare potation that “there is a tide in the affairs of which have taken at the floods leads onto fortune” omitted, all the voyage of their life is bound in shadows and in miseries may be relevant here. The developing economics appear and acquisition of updated information technology that will offer customers a wide choice of transactions.


According to O.K Olakanmi (2002), he defined Management information system “as a formal information network using computers to provide management with information it needs to make decisions”. He went further to say that information system is a means of identifying, gathering and processing all relevant data with a view to enhancing the quality of decision bearing on the subject matter.

Dr Okafor (2000) emphasized that information technology has wounded the horizon of banking practices and charged the nature and economics of banking as well as the competitive environment in which bankers operate information today means power and indeed prior information means wealth.

Eze (1997) stated that “Nigeria customers will expect to have the benefits of the electronic revolution in his banking transactions. He will expect a bank statement to be more frequent and up-to-date, if not online.

Already glimmers of this future are on our shares. In one or two state of the art banks in the country, you can now asses your account balance from any office and print your statements yourself with the aid of a model attached to your computer.

Bill gates (1996) emphasized that the application of information technology in banking operations has helped management effectiveness. With the advent of information technology in the Nigerian banking environment, transactions has become amazingly fast while at the same time providing instant reconciliation and near error free responses, the storage and retrieval of information from data base make the processing of customers account easier.

Stewart (1977), Green and Morphet (1977), they stated that it involves practical arts manifested in the execution of most human activities including communications , mining, transportation, manufacturing, construction, agriculture, hunting, and production of services among others.

From a narrow prospective however, technology can be defined as a body of knowledge, know-how required for the execution of a given activity and its entails information, skills and processes necessary for the execution of such activity in the society.

In this regard, Eze (1996) observed that information technology is radically altering the balance of power between institution, governments and the people by broadly disseminating important information.

According to CBN (1998), the watershed in complication of the Nigeria Financial sector started with the changing policy environment enunciated in the Structural Adjustment Programme (SAP). This give rise to competition within the system hence re-engineering of data processing techniques.


Nigerian banks are responding albeit at snail speed, to the information revolution enveloping the universe.

The deregulation of the bank sector in Nigeria in 1986 brought far-reaching transformation through computerization and improved bank service delivery.

In effect, the emergence of crop of new generation banks following the liberalization of bank licensing motivated the introduction of high technology in the Nigeria banking sector. Some of considered the ‘arm-chair’ brick and mortar approach to banking of the old generation banks as having no regard to the customers and therefore an identified weakness they could exploit for.

These new banks discovered that the evolving technology at the global level could be applied to a greater advantage in the Nigerian financial landscape.

That indeed paid off for some of them, as customers who ordinarily would have found it almost impossible to leave the banks they were already familiar with, for a new one that was yet to find its feet, quickly noticed the difference in the available products and service delivery systems of the two categories of banks.

The customers, without hesitation opted to pay for the extra-personalized product and services and the attendant personalized marketing.

They therefore demonstrated preparedness to switch from one bank to another the old ties notwithstanding, as they identify gaps in the service delivery of their original banks. As we tap into the years ahead to have bank develop credible credit cards system, install unmanned cash pond in the street corner to enable depositors have access to their money at anytime.

The competition approach adopted by some of these new generation banks became a challenge to the older ones waking them up from their long slumber.

Ndekwu (1994), observed that inter bank competition for deposits and overnights loans has become a phenomenon in the Nigerian banking sector. However, the emerging environmental challenges have compelled many banks to reposition themselves with strong information technology back-up to be able to provide improved banking services to be at tide today and should endeavor to exploit the opportunities to the fullest. Information technology is a unique competition tool along the global business arena. Competing organization becomes less relevant in an information environment. The application of IT has trivialized the use of branch networks as competitive tools, especially as internet banking facility has become an enabler for customers to assess their accounts and perform on-line transactions through the .World Wide Web (WWW) from the offices or homes.

The availability of good telecommunication infrastructure and technologies like internet will permit Nigerian organization to do an increased amount of business nationally and internationally. Connectivity to the emerging “information super highway” will take time, space and distance to mature. The future will definitely be dark for those countries and organizations that do not join the electronically networked society. Companies such as banks that depend greatly on information than most other enterprise cannot afford to lack behind in this aspect


Information technology maybe considered to be the harnessing of electronic technology in its various forms to implore the operations and profitability of the business as a whole. Information technology provides significant improvement with facilities such as word processing, improving secretarial typing and some reprographic services, communication facilities in the form of electronic mail database. This is the assumption that high customer satisfaction leads to sustainable revenue growth and profitability. This claim is based on the argument provided by Heskett etal (1997), “That profit and growth rate are estimated primarily by customer’s loyalty, and loyalty is a direct result of customers satisfaction”.


    0 of 8192 characters used
    Post Comment
    • profile image

      Udoh Ndubuisi 

      5 years ago

      Do you know what makes me happy whenever I'm reading your articles? It's all about my profession - I read banking and finance. Thanks so much for your time and effort.

    • profile image


      5 years ago

      nice working...but would have been much better with citations

    • monicamelendez profile image


      7 years ago from Salt Lake City

      Very nice write up thanks. I've been reading a lot about finance systems in other countries. So interesting!

    • profile image


      8 years ago

      I like the write up.its very nice and interesting


    This website uses cookies

    As a user in the EEA, your approval is needed on a few things. To provide a better website experience, uses cookies (and other similar technologies) and may collect, process, and share personal data. Please choose which areas of our service you consent to our doing so.

    For more information on managing or withdrawing consents and how we handle data, visit our Privacy Policy at:

    Show Details
    HubPages Device IDThis is used to identify particular browsers or devices when the access the service, and is used for security reasons.
    LoginThis is necessary to sign in to the HubPages Service.
    Google RecaptchaThis is used to prevent bots and spam. (Privacy Policy)
    AkismetThis is used to detect comment spam. (Privacy Policy)
    HubPages Google AnalyticsThis is used to provide data on traffic to our website, all personally identifyable data is anonymized. (Privacy Policy)
    HubPages Traffic PixelThis is used to collect data on traffic to articles and other pages on our site. Unless you are signed in to a HubPages account, all personally identifiable information is anonymized.
    Amazon Web ServicesThis is a cloud services platform that we used to host our service. (Privacy Policy)
    CloudflareThis is a cloud CDN service that we use to efficiently deliver files required for our service to operate such as javascript, cascading style sheets, images, and videos. (Privacy Policy)
    Google Hosted LibrariesJavascript software libraries such as jQuery are loaded at endpoints on the or domains, for performance and efficiency reasons. (Privacy Policy)
    Google Custom SearchThis is feature allows you to search the site. (Privacy Policy)
    Google MapsSome articles have Google Maps embedded in them. (Privacy Policy)
    Google ChartsThis is used to display charts and graphs on articles and the author center. (Privacy Policy)
    Google AdSense Host APIThis service allows you to sign up for or associate a Google AdSense account with HubPages, so that you can earn money from ads on your articles. No data is shared unless you engage with this feature. (Privacy Policy)
    Google YouTubeSome articles have YouTube videos embedded in them. (Privacy Policy)
    VimeoSome articles have Vimeo videos embedded in them. (Privacy Policy)
    PaypalThis is used for a registered author who enrolls in the HubPages Earnings program and requests to be paid via PayPal. No data is shared with Paypal unless you engage with this feature. (Privacy Policy)
    Facebook LoginYou can use this to streamline signing up for, or signing in to your Hubpages account. No data is shared with Facebook unless you engage with this feature. (Privacy Policy)
    MavenThis supports the Maven widget and search functionality. (Privacy Policy)
    Google AdSenseThis is an ad network. (Privacy Policy)
    Google DoubleClickGoogle provides ad serving technology and runs an ad network. (Privacy Policy)
    Index ExchangeThis is an ad network. (Privacy Policy)
    SovrnThis is an ad network. (Privacy Policy)
    Facebook AdsThis is an ad network. (Privacy Policy)
    Amazon Unified Ad MarketplaceThis is an ad network. (Privacy Policy)
    AppNexusThis is an ad network. (Privacy Policy)
    OpenxThis is an ad network. (Privacy Policy)
    Rubicon ProjectThis is an ad network. (Privacy Policy)
    TripleLiftThis is an ad network. (Privacy Policy)
    Say MediaWe partner with Say Media to deliver ad campaigns on our sites. (Privacy Policy)
    Remarketing PixelsWe may use remarketing pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to advertise the HubPages Service to people that have visited our sites.
    Conversion Tracking PixelsWe may use conversion tracking pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to identify when an advertisement has successfully resulted in the desired action, such as signing up for the HubPages Service or publishing an article on the HubPages Service.
    Author Google AnalyticsThis is used to provide traffic data and reports to the authors of articles on the HubPages Service. (Privacy Policy)
    ComscoreComScore is a media measurement and analytics company providing marketing data and analytics to enterprises, media and advertising agencies, and publishers. Non-consent will result in ComScore only processing obfuscated personal data. (Privacy Policy)
    Amazon Tracking PixelSome articles display amazon products as part of the Amazon Affiliate program, this pixel provides traffic statistics for those products (Privacy Policy)
    ClickscoThis is a data management platform studying reader behavior (Privacy Policy)