THE IMPACT OF INTERNET ON QUALITY SERVICE DELIVERY IN NIGERIA BANKING INDUSTRY: A CASE STUDY OF ZENITH BANK PLC

ABSTRACT

This research work is focused on the impact of internet on quality service delivery in Nigeria banking industry– A case study of Zenith Bank Plc. Some the  objectives of the study includes to;   determine whether inadequate and inexperience staff (personnel) to  use  communication systems affect data  processing for  effective banking operations, appraise the effect of unavailability of timely and accurate computer information to  the  end  users  (customers and  others stakeholders in banking industry) on corporate performance of banks,   find out if high cost of producing financial information scientifically to the end users (customers and others stakeholders in banking industry) result from inadequate use of internet, etc. The research design adopted for the purpose of the this study was survey, concerned with gathering of data that are social in nature and using the result to develop inferences from the selected sample to generalized about the total population. The research made use of 368 sample size.   The finding in the test of hypotheses show the followings that; Inadequate and inexperience staff (personnel) to use communication systems affects data processing for effective banking operations Unavailability of timely and accurate computer information to the end users (customers and others stakeholders in banking industry) affects corporate performance of banks. High cost of producing financial information scientifically to the end users (customers and others stakeholders in banking industry) results from inadequate use of internet. The non-conformity by the banks to technology and financial guidelines affects the use of internet in banking operations. The dwindling economy that do not allow for investments in information technology especially  internet  on  banking  is  a  setback  on  banking  activities.etc.  The researcher made this recommendation based on conclusion, that; adequate and experience staff (personnel) to the use of   communication systems in data processing for  quality service delivery in  Nigeria banking industry should  be planned and provided for predetermined corporate goals, availability of timely and accurate computer information to the end users (customers and other stakeholders in banking industry) should be solicited, high cost of producing financial information scientifically to the end users (customers and other stakeholders in banking industry) should be cushioned through marketing activities in banks, etc.

CHAPTER ONE INTRODUCTION

1.2     BACKGROUND OF THE STUDY

Internet is one of the world’s most interesting and greatest achievements in the last millennium. The Internet was born in the 1960’s by the United State Defence and the Advanced Project Research Agency (APRA), which interconnected their Local Area  Networks  to  form  ARPA  net.  This  was  an  attempt  to  maximize  the advantages of the new computer networking technology. With the success of the ARPAnet, the United State’ National Science Foundation (NSF) equipped five universities with supercomputer and interconnected them. These five universities became points of service centers for neighboring University LANs. The resulting network was called NSFnet.

Finally, the NSFnet was hooked unto the APPAnet using already existing telecommunication networks where possible. The computer networking technology was not limited to America, countries in Europe and Asia also connected their universities  and  research center  LANs  forming  national  networks  which  they interconnected with the ARPanet to form the information super highways today called Internet. The size of Internet is still increasing linking hundreds of nations, thousands of computers and millions of people. Today, Internet has become an indispensable tool for communication, education, research, entertainment and public relations. Presently, various government, universities, private organizations, computer science and engineering associations, manage and maintain Internet.

Internet can be seen as a measure of interconnectivity and inter-relation of millions of computers all over the world for the basic purpose of information exchange. Each computer so connected maintains its own position of the Internet. In other words, Internet could be taken to mean scheduling every aspect in transactions into a whole whereby message sent and received are regulated. All the computers that are built in an Internet operate common language or prototype as standard in order that a free flow communication (between sender and receiver) is enhanced, the difference in hardware or software not with standing. The benefits in an Internet to all disciplines according to Adeola (2006) are in its facilitator of globalization process. To this effect, Internet in banking is the gateway to effective buying and selling globally of  financial services considering the  intensive knowledge and opportunity available. Here Internet banking, educates, persuades and guides financial analyst to effective decisions relative to limited available resources.

Contributing Igbinosa (2003) agrees that effective internet usage in organizations (including banking) is a necessity to overcoming competition and ultimately arrive at a success. He (Igbinosa) however added that internet usage in banking should be exercise with caution as a result of variety of risks surrounding networking performance and security in data; However, Mabbare (1999) is of the opinion that if benefits are to be derived in internet by banks, training of resources (human) in selected programme (e.g. electronic mail-Email and Worldwide Web-WWW) are very potent  tool.  This  is  because a  broad knowledge of  this  programme will strategically position bankers in terms of accessing data and exchange information. It will also assists in making financial   budgets, forecasting and other services more interesting, attractive and less cumbersome.

Thus, this study believes that for the aims (especially quality service delivery) in effective internet banking services to be achieved, internet services that are affordable, reliable and accurate should be built. To Anyanwu (2000), adequate internet installations are prerequisite to bankers satisfying their customer’s needs and wants in terms of time, place and quality services. Similarly, he |(Anyanwu

2000) emphasized that internet services of banks to a very extent creates customers loyalty/patronage as well as sustain goodwill of banks products and services. At this, internet banking is continuously assessed as a working tool without which objectives of stakeholders may not be achieved especially in quality service delivery. However, the application of internet in banking operations or activities (as in selected banks in Lagos) needs a rationale decisions that could retain existing customers as well as win potential customers.

1.2     STATEMENT OF THE PROBLEM

It  is  a  common knowledge today that  most  banks  in  Nigeria  lack competent personnel  in  the  use  of  internet  on  service  delivery  that  satisfies  customers, although banks have been sensitized especially to acquire all the necessary skills and computer accessories in the application of internet services. For total quality service delivery in banks, there is the need for banks’ staff and services to have deep-rooted knowledge and facilities of internet for the expected service delivery. Internet application holds the keys to most modern banking, but the question is how far is internet enhancing service delivery for stakeholders in Nigerian banking industry?

1.3     OBJECTIVES OF THE STUDY

The main theme of this study is to appraise the impact of internet on quality service delivery in Nigeria banking industry, using Zenith Bank Plc as a case study.

In other words  it seek to determine the  relationship of internet with banking activities of commercial banks especially Zenith Bank Plc in Lagos

Other objectives of the study include:

i.     To determine whether inadequate and inexperience staff (personnel) to use communication systems affect data processing for effective banking operations.

ii.     To appraise the effect of unavailability of timely and accurate computer information to the end users (customers and others stakeholders in banking industry) on corporate performance of banks.

iii.     To find out if high cost of producing financial information scientifically to the end users (customers and others stakeholders in banking industry) result from inadequate use of internet.

iv.     To  find  out  if  the  non-conformity  by  the  banks  to  technology  and financial guidelines could affect the use of internet in banking operations.

v.     To examine if the dwindling economy that do not allow for investments in  information  technology  especially  internet  on  banking  could  be setback on banking activities.

1.4     RESEARCH QUESTIONS

This has to do with the cause of the problems identified above but put in question form.

i.  Does  inadequate  and  inexperience  staff  (personnel)  to  use communication systems affect data processing for effective banking operations?

ii.     Does unavailability of timely and accurate computer information to the end users (customers and others stakeholders in banking industry) affect corporate performance of banks?

iii.     Does high cost of producing financial information scientifically to the end users (customers and others stakeholders in banking industry) result from inadequate use of internet?

iv.     Can  the  non-conformity  by  the  banks  to  technology  and  financial guidelines affect the use of internet in banking operations?

v.     Can  the  dwindling  economy  that  do  not  allow  for  investments  in information technology especially internet on  banking be  setback  on banking activities?

1.5    RESEARCH HYPOTHESES

The following tentative hypotheses were formed to guide this study:

Hypothesis I

Ho:   Inadequate and inexperience staff (personnel) to use communication systems do not affect data processing for effective banking operations.

Hi:    Inadequate and inexperience staff (personnel) to use communication systems affects data processing for effective banking operations.

Hypothesis II

Ho:   Unavailability of timely and accurate computer information to the end users (customers and others stakeholders in banking industry) do not affect corporate performance of banks.

Hi:    Unavailability of timely and accurate computer information to the end users (customers and others stakeholders in banking industry) affects corporate performance of banks.

Hypothesis III

Ho:   High cost of producing financial information scientifically to the end users (customers and others stakeholders in banking industry) do not result from inadequate use of internet.

Hi:    High cost of producing financial information scientifically to the end users (customers and others stakeholders in banking industry) results from inadequate use of internet.

Hypothesis IV

Ho:   The non-conformity by the banks to technology and financial guidelines do not affect the use of internet in banking operations.

Hi:    The non-conformity by the banks to technology and financial guidelines affects the use of internet in banking operations.

Hypothesis V

Ho:   The dwindling economy that do not allow for investments in information technology especially  internet  on  banking  is  not  a  setback  on  banking activities.

Hi:    The dwindling economy that do not allow for investments in information technology especially internet on banking is a setback on banking activities.

1.6     SIGNIFICANCE OF THE STUDY

The outcome to this research will be beneficial to the government, banks, and experts in information technology, financial analyst and academic institutions.

To the government, the study will enhance revenue from the importation and use of technologies and its accessories for effective electronic banking. Taxes paid to the  government for use of technological devices are used in developing other sectors in the economy. In addition government regulatory activities on financial

and information technology we help in checking illegal practices among financial institutions.  Banks and their staff are assisted through this research to learn new skill/capabilities by adjusting to the technological devices in banking of services. In other words, research, training and development of staff of banks are enhanced. The study is also capable of correcting certain anomalies likely to come up following the use of information technology (internet) for financial services especially banking operations. The study will identify bank areas of strength and weakness in the use of information technology (internet) for banking services.

To financial industry, information technology (internet) and banking services is useful in their satisfactorily rendering services to stakeholders.

To the academic, this study will form basis for studies and sustain an existing knowledge.

1.7     SCOPE OF THE STUDY

The study is focused on the impact of internet banking on quality service delivery in  Nigeria  especially  Zenith  Banks  Plc  in  Lagos  between 2007-2012.  It  will involve staff in different departments of the bank especially computer, marketing and administration as well as customers. It will emphasis strategies banking aimed at encouraging customers to accept the use of internet in service delivery as well as in informing the public scientifically about bank’s activities.

1.8     LIMITATIONS OF THE STUDY

The conduct of this research may be limited by the following factors:-

Time, which may not be enough for the enormous facts and ideas the research study may require. Added to this is the content of the topic of study. Infact the study may require much time for more coverage.

Research   information   or   materials:   may   not   easily   be   available   from respondents.

Finance: may be another area where the research may encounter some set backs. Most materials needed for the research work may be quite expensive and not within the reach of the researcher. This short/comings not withstanding, adequate data will be collected and analyzed.

1.9     DEFINITION OF TERMS

Certain concepts and variables used in the study need be defined for clarity and comprehension. However, those not defined under this chapter will be treated in the course of the study terms for definition includes.

Information technology: This  is  concerned  with  processing data  and  related resources into a productive information and use.

Internet and the World Wide Web: The internet is a global communication based on computer network.

Effectiveness: This involves doing those things necessary to accomplish organizational objectives.

Efficiency: It is concerned with doing right job in the right way at the right time. Restructuring: This concern redesigning the corporate outlook of an organization by either down sizing or building resources through a review to fall in line to expected standard.

Reorganization: This concern re-arranging an adopted procedure or policy of an organization to making it more effective or functional.

Privatization: This is the transferring of public ownership interest and control in enterprise to the private sector.

Commercialization: This is the operations of an enterprise as a profit making ventures without subventions from the government or her agencies.

1.10.  BRIEF HISTORY OF ZENITH BANK OF NIGERIA PLC

Zenith Bank Plc was incorporated as Zenith International Bank Limited, a private limited liability company on 30th May 1990 and was granted a banking license in June 1990. The bank, which is wholly owned by Nigerian Citizens, commenced operations on the 16th  June 1990. The name of the bank was changed to Zenith Bank Plc on 20th May 2004, to reflect its status as a public liability company. The Bank has two subsidiary companies namely, Zenith General Insurance Limited (99%) and Zenith Securities Limited (94%). These subsidiaries however have not been consolidated in most of the Bank’s financial statement until recently. The Bank  also  acquired  majority shareholding in  three  companies  incorporated  in Nigeria namely; Qubit Spectrum Limited, Venus Telecom Limited and Cyberspace Networks Limited under the small and Medium Enterprises Equity Investment

Scheme  (SMEEIS).  The  Bank’s  Corporate  Head  Office  is  at  plot  84,  Ajose Adeogun Street, Victoria Island, Lagos.

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