AN APPRAISAL OF THE IMPACT OF INTERNET BANKING SYSTEM ON THE WORLD BANKING ENVIRONMENT

ABSTRAC

Internet banking is simply operating the banking system through the internet or Electronic and it signifies both global public network and a family of technologies. In Nigeria, the banking industries are basically on-line at real time with web site which is restricted only to information and also it restricts most of their dealings to e’banking via the internet and not internet banking proper, effective cash management via e’banking on the other involves managing the motives of a firm in order to maximize cash availability and internet income in any idle fund via e’banking for efficiency and effective purposes, e’banking helps quicken the technology in recent globalization, but not withstanding, there are still risk involve in e’banking but such is properly under control which was why the banks restricted e’banking transaction within themselves with proper protocols to check, with this in place customers are highly satisfied and the banking sectors well fitted.

CHAPTER ONE

INTRODUCTION

1.1   BACKGROUND OF THE STUDY

The rapidly unfolding development within the information technology in recent times has led to resurgent calls for monies towards an effective cash management through Internet banking (i.e. E-Banking). In the last few years, within the banking industry in Nigeria several commercial products have designed by banks to improve the qualities of services provided to customer. These products were also designed to meet the increasingly sophisticated needs of finance managers in a cross section or organizations operating in different sectors of the economy. In recent years, these have been an evolution from paper transfer system and ordinary procedural cash management to an electronic transfer system and more secured and sophisticated cash management. There has been introduced, an increased sophistication in computer applications to cash management and in electronic funds transfer. It is the responsibility of the finance manager to ensure proper management of a company’s account receivable and payable amongst other tasks. Improper management of these two important variables could result in losses arising from inability to take interest because of too early payments. Overdraft and loan interest charges could be incurred because of unnecessary working capital borrowings. The task faced with the finance manager is accelerating collections and showing a disbursement which is increasingly being done electronically. The advert of financial innovations such as electronic transfer in the payment system and more recently, the launching of internet banking have transformed the worlds into a global village linked with electronic impulses.

1.2   STATEMENT OF THE PROBLEM

Financial management is a key to the growth of any business perspective of the size and geographical spread of the firm. As business conqueror their immediate environment and spread to other towns and cities, it becomes more difficult to exercise control over the finances of the firm. There is the need to deliver funds to locations where it is needed and collect excesses from some other locations across the country. A number of problems abound in the Cash Management Service Department of any organization in Nigeria, such problems include the following:

a.              Delay in collecting receivables and effecting disbursement without considering interest and discounts that could be earned.

b.             Inefficiency in funds transfer from one town or region to another.

c.              Ineffective handling or the increasing volume, complexity, competitiveness, customer sophistication and globalization or financial services.

1.3   OBJECTIVES OF THE STUDY

The main objectives of this research work are:

1.     To highlight the important task of the finance manager.

2.     To show the essence of Electronic Banking as an effective mean of cash management and their products.

3.     To prevent a review of the conventional banking procedure in cash management and the implication of the source of every fund to the company. Hence the cost benefit.

1.4   SIGNIFICANCE OF THE STUDY

This work will go a long way to benefit:

a.      Researchers who wish to have ideas as to the various measure or strategies that might be employed in effective cash management through Electronic Banking.

b.     This research work will also expose some likely problems encountered implementing measures/strategies embarked upon in an effective cash management through Electronic Banking.

1.5   RESEARCH HYPOTHESIS

The hypothesis of the study are been formulated and will be based on the objective of the study such as;

1.     Ho: If appropriate skills are not developed in Management

Information System (MIS), then there will be poor performance.

      HI: If appropriate skills are developed in Management Information System (MIS), there will be excellent performance and employee efficiency.

2.     Ho: When banks do not acquire the necessary advanced technology, they will lose customer’s confidence and will not be efficient and effective.

HI: When banks acquire the necessary advanced technology, they will    gain customer’s confidence and will be efficient and effective.

1.6   SCOPE OF THE STUDY

This topic of study is towards an effective cash management through Electronic banking. Problems and prospects, a Case Study of Zenith International Bank Plc. Therefore the research covers the problems, 

1.7   LIMITATIONS OF THE  STUDY

The limitations of this research work are catalogued below:

1.      The practice of approving project topics at the end of the first semester by the department does not allow enough time for proper research, and this was a great constraint to the researcher.

2.      This study was carried out without the required expert skills by the researcher in computing to venture into a topic of this nature which is very technical.

1.8   DEFINITION OF TERMS

Account: The recording in the ledgers of the financial transactions that occur and the use to which the records are put, their analyses and interpretation. Hence it shows the receipts, the expenditure and outstanding balances.

Bank: A financial house coordinating the applicable to finance recording account deposits and withdrawals of a customer. The bank sends a statement to its customer at agreed regular intervals.

Bills of Exchange: An unconditional order in writing, addressed by one person to exchange another, signed to whom it is addressed to pay on demand, or at a fixed or determinable future time, a sum certain in money to, or to the order of a specified person or bearer.    

Book-Keeping: This is the actual record making phase of Accounting.

Cash: Consist of the firms holding of currency and demand deposit, with demand deposit being the most important for most firms. It is an Asset and a scene resource which must be conserved and earn a reasonable return for the company.

Cash Management: Involves controlling the investment in current assets, which involves managing the movies of a firm in order to maximize cash availability and interest income in any idle funds.