Impact of E-Banking on the Profitability of Banks in Ghana

Abstract

The study assessed the impact of electronic banking on the profitability of a Bank in Ghana. How the bank finds itself before a new fact imposed by technology revolution that has changed their work mechanisms from traditional means to electronic means. Furthermore, this study investigates how the electronic banking services through internet and ATM has impacted on banking services in general and the banks’ profitability in particular. The methodology was quantitative in nature. In all, 150 questionnaires were administered to the interviewee from the selected branches of the Agricultural Development Bank who are customers, to solicit information concerning the E-banking. All data from the structured self-administered questionnaires were correctly organized. The software that was used for this is, Statistical Package for Social Sciences (SPSS). The study was also more descriptive in nature. After testing the hypothesis by using inferential statistics, it was discovered that E-banking does have an impact on the profitability of the Agricultural Development bank. There was a significant increase in the net profit margin of the bank in the year (2011) E-banking was introduced and the even though it fell in the next year (2012) which wasn’t much, it increased again in the third year (2013).The study revealed that E-banking has a positive effect on ADB’s Profitability.

Keywords: Profitability, Electronic Banking, Internet Banking, ADB