IMPACT OF INFORMATION TECHNOLOGY ON BANKING OPERATIONS.
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IMPACT OF INFORMATION TECHNOLOGY ON BANKING OPERATIONS.
Chapter one
Background of the study
1.0 Introduction
In recent years, Information Technology (IT), which primarily involves the use of electronic devices, particularly computers, for storing, analysing, and distributing data, has had a dramatic impact on almost all aspects of individual lives and the national economy, including the banking sector.
The increased usage of information technology has enabled amazing integration of many economic entities. This phenomenon is applicable not only to Nigeria, but to other economies around the world, but the extent of its use may vary.
In Nigeria, IT utilisation has significantly improved, particularly in the banking industry, however it may not be as high as in advanced countries (Adeoti, 2005; Adeyemi, 2006).
The usage of information technology in the banking industry piqued the interest of this study due to its importance in the economy. It promotes economic growth by channelling funds to economic agents who require them for productive purposes.
This role is critical for any economy seeking meaningful growth because it develops agreements that bring borrowers and lenders of financial resources together more efficiently than if they had to deal directly with one another (Adam, 1998; Ojo, 2007).
In essence, the banking industry serves as a bridge between lenders and investors in the economy. As a result, improvements are required at the Central Bank of Nigeria (CBN).
The banking business is one of the most important sectors of the economy, and its impact on the rate of development and economic growth is difficult to measure.
Changes in today’s modern world demonstrate that the dominance of natural causes does not adequately equip the banking sector to deal with the demands of global completion.
According to Hanna (1994), information, flexibility, and rapid response are the major new aspects for dealing with global competition, and information communication technology plays an important role in these areas for quality improvement. According to Antholt (1993), knowledge is equally significant as production factors such as land, labour, and money.
The importance of IT in today’s successful organisations should not be overlooked. It is critical to an organization’s performance in a highly competitive environment because it provides an easy and quick way to collect, store, retrieve, process, transfer, and distribute information.
Other elements can influence a firm’s success, and a firm may employ a variety of techniques to achieve success. However, fast and easy access to information via the usage of IT is critical to the firm since it influences all other success elements, and competitive plans cannot be achieved without it.
As a result, no organisation can achieve the top position in its industry by minimising the use of information technology. This is particularly true for financial institutions, such as commercial banks.
As a result, commercial banks are very information heavy, and their use of information technology for easy and fast information collection, storage, retrieval, processing, transmission, and distribution should have a significant impact on their performance.
The evolution and current breakthroughs in information and communication technology have affected the way businesses operate and do business. The growth of the World Wide Web (internet) and mobile telephony, or telecommunication systems, is driving this trend.
As a result, manual and traditional methods of conducting business are becoming obsolete, giving way to sophisticated technology based on automation and the integration of computers and other electronic equipment via electronic communications.
For example, ledger books, paper invoices, printed documents, and business travels are being replaced by online billing and payments, extensive websites with product information, and real-time teleconference across
Continent and time zones.
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