Effects of Automated Teller Machine on the Performance of Nigerian Banks

Abstract

This study investigates the effects of ATM on the performance of Nigerian banks. Available studies have concentrated on the significant dimensions of ATM (automated teller machine) service quality and its effect on customer satisfaction with a bias against ATM producers. The study is motivated by the astronomical challenges confronting the proliferation of ATM infrastructure and attendant financial losss to banks which are often underreported. Also, there are serious debate on the relevance of ATM technology as most countries in the world are moving away from the virus technology to the more secured chip cards free of credit and debit frauds. Questionnaire was used to collect the data from a convenience sample of 125 employees of five selected banks in Lagos State with interswitch network. Therefore, data collected through the questionnaire were analyzed statistically by using the Software Package for Social Science (SPSS Version 20.0 for Student Version) and chi-square technique. The results indicate that less than the benefits, the deployment of ATMs terminals have averagely improved the performance of Nigerian banks because of the alarming rate of ATM fraud. Similarly, ATM service quality is less correlated to security and privacy of users and providers.The conclusion therefore is that banks should strive to increase their security layers to subvert the tricks of web scammers, limit the amount which customers may be allowed to withdraw at a time and provide electronic alerts to customers'phone for all transactions carried out on their bank accounts through ATMs and the provisions of extra security layer that can prevent third party to make use someone else's ATM card for unauthorized withdrawals electronically.

Effect of Automated Teller Machines Usage on Operational Performance of Commercial Banks in Nakuru County, Kenya

“…Therefore, it was concluded that ATM usage is highly related to operational performance. This study is consistent with the findings of [6] who argued that Automated Teller Machines contribute to the effectiveness of banking sector. He further argued that Automated Teller Machine stimulate banking industry growth.…”

“…Reasons for the introduction of ATMs in retail banking include lower labour cost, efficiency, greater consumer involvement, standardization of service delivery, customer satisfaction and loyalty. [6] contends that less than the benefits, the deployment of ATMs terminals have averagely improved the performance of Nigerian banks because of the alarming rate of ATM fraud. According to [10], convenience, reliability, ease of use, privacy, security, responsiveness and fulfillment were found to be the major dimensions of ATMs service quality.…”

Financial Inclusion in Egypt: Does It Affect Banks’ Profitability and Liquidity?

“…This study produced results which corroborate the findings of a great deal of the previous work in this field. A number of relevant studies tied the expansion of ATM networks with the improvement in the banks' profitability (Humphrey, 1994;Jegede, 2014;Akhisar et. al., 2015;Shihadeh et.…”

“…On the other hand, the study concluded that the users of the banks' services have benefited more from using ATMs than the banks have. Similarly, (Jegede, 2014) has concluded that the expansion in using ATMs will improve the performance of Nigerian banks, contribute to the effectiveness of the banking sector, and enhance the opportunities of bank growth.…”

Determinants of Bank Profitability: Case of Latvia

“…Thus, the current study seeks to investigate if the total number of customers has an impact on profitability, as well as private and legal customers, could be considered separately as influencing factors. Authors researching bank profitability issues claim that number of automated teller machines (ATMs) could improve profitability (Akhisar et al, 2015;Jegede, 2014;Le & Ngo, 2020;Ramila & Gurusamy, 2016;Salimi et al, 2013;Turkoglu & Genevois, 2017). In line with ATMs, the number of payment cards could play a vital role in maximising bank's profitability, as they are used to reach customers via a point of sale (POS) and ATMs; hence, the number of payment cards is considered to be another independent variable (Hamdi et al, 2017;Le & Ngo, 2020).…”