Electronic Banking and Its Impact on the Financial Performance of Commercial Banks in Bangladesh: A Descriptive Analysis

Abstract

E-banking has significantly expanded in popularity and emerged as one of the most widely used banking systems during the last few years. Information technology (IT) has become the heart of the banking sector, while the banking industry is the heart of every robust economy. Through reducing banking costs, electronic banking can increase bank incomes. However, there is a relative dearth of empirical studies examining the impact of e-banking on the performance of banks. Though e-banking is gaining acceptance in Bangladesh, its impact on bank performance has yet to be established. Using panel data from commercial banks, this study empirically investigated the impact of e-banking on the performance of Bangladeshi banks measured in terms of net profit and factors representing electronic banking. The empirical findings of this study are of greater significance for developing countries like Bangladesh because they will invoke the attention of bank management and policymakers to pursue such policies to expand e-banking. This study also contributes to the empirical literature by confirming (or otherwise) the findings of previous studies.

Keywords: E-Banking, Financial Performance, Commercial Banks

JEL Classification: L86, M15

DOI: 10.7176/RJFA/14-7-02

Publication date: April 30^th 2023