Electronic Banking Instruments and Performance of Deposit Money Banks in Nigeria: The Camel Evaluation Approach

Abstract

The study examined the interplay between Electronic Banking Instruments and Banks’ Performance in Nigeria. E-banking instruments were measured in the study with Automated Teller Machine (ATM), Point-of-Sale (POS) and Mobile Payment (M-Pay) while banks’ performance was measured with CAMEL rating system. Data were sourced from the Central Bank of Statistics Bulletin and Annual Reports of Nigeria Deposit Insurance Corporation from 2010 – 2019. Data collected were tested for normality using Jarque-Bera statistics and were analysed using Pearson Product Moment Correlation analysis. Results from the analyses revealed that ATM, POS and M-Pay shown negative but insignificant relationship with capital adequacy ratio; ATM and M-pay had negative but insignificant relationship with assets quality while POS had significant negative relationship with assets quality; ATM and M-Pay were positively but insignificantly related with management efficiency while POS has negative but insignificant relationship with management efficiency. Findings further revealed that each of ATM, POS and M-Pay had significant positive relationship with ROA while on the other hand exerted positive but insignificant relationship with banks’ liquidity. It was therefore recommended (among others) that Nigerian banks should step-up their awareness creation on the benefit of utilizing e-banking products and that federal government should create a more enabling environment to enhance e-banking activities.