Electronic Banking Transactions and Their Effects on the Performance of Selected Commercial Banks in Cameroon

Abstract

This paper focuses on the electronic banking transactions and how these transactions affect the performance of banks. Using a series of proxy variables for e-banking adoption, the study seeks to verify how the implementation of e-banking by commercial banks affects the profitability of the banks. The data for the study was got from the financial records of selected commercial banks in Cameroon as well as from the data base of the Central bank of Cameroon (BEAC), between 2006 and 2018. In analyzing the data, regression analysis method was used to determine the impact of MMT, ATM, PPV, IFR, and DTF on the ROA of the banks. Other analytical methods used include, correlation analysis and descriptive analysis. The findings of the study reveal that MMT, DTF and EPT all have positive impacts on ROA, while PPV and IFR have negative impacts on the ROA of the banks. The overall results however indicate that e-banking transactions have a significant impact on the profitability of banks. The study recommends that banks should increase the level of direct participation into the Mobile banking market. In addition, the commercial banks should increase international transfer transactions, Electronic payment terminals as well as improve on the level of e-banking technology and innovation.

Key words: Electronic Banking, Performance, Commercial banks, Cameroon

DOI: 10.7176/RJFA/11-8-11

Publication date: April 30^th 2020