Binuyo technology cost efficiency compared to investment in information

Binuyo and Aregbeshola (2014), The study assessed the impact of ICT on the performance on banking industry using annual data over the period 1990-2012 published by Bankscope – World banking information source. Data analysis is carried out in a dynamic panel environment using the orthogonal transformation approach. The robustness of the results was affirmed by residual cointegration regression analysis using both Pedroni and Kao methods. The findings of the study indicated that the use of ICT increases return on capital employed as well as return on assets of banking industry. The study discovers that more of the contribution to performance comes from information and communication technology cost efficiency compared to investment in information and communication technology. The study recommends that banks emphasize policies that will enhance proper utilization of existing ICT equipment rather than additional investments.

Otukoya (2014), his research says that information technology has a positive impact on the image, goodwill and growth of banks. Customer satisfaction is of a paramount importance to the achievement of organizational goals. It has geometrically increased the rate of patronage as a result of the supply of redefined products and services to meet the needs and demand of the public. Information technology has also helped to reduce the rate of fraud in the banking system. Present day banking activities are computerized and not manual, making it difficult to make any alterations; such actions can easily be traced and corrective measure taken. Information technology has also provided better and well-grounded infrastructure to speed up transaction, increase consistency and enhance banks operation.

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Web internet saving money may be not yet formed What’s more great created for Ghana, (Amoako, 2012). Singh (2002) said that engineering organization need prompted better approaches about delivering saving money administrations and items with customers, for example, such that ATMs, portable moneys, SMS alerts Also web saving money (IB). Subsequently banks bring created themselves at those bleeding edge from claiming innovation organization execution to days gone by two decades. These transforms Also developments in the managing an account industry bring impactedpositively on the administration quality, future of the saving money activities, Furthermore hence its continually focused inclination in the planet businesses since setting off alongside engineering will be a standout amongst the practically noteworthy Components for investment associations achievement. (Nyangosi, 2009).

Former to that period, the fundamental operators in the provincial money related showcase comprised extensions for business banks, kudos unions and also other substances in the casual segment for example, cash 22lenders, dealers Furthermore “susu” collectors. Companions What’s more relations were likewise paramount sources for provincial account. Fiscal intermediation On country Ghana might have been during a low level contrasted with the circumstances On urban territories. Consequently, financial units in the rustic regions were starved from claiming monetary assets. Those banks which worked extensions in rustic regions mostaccioli served those enthusiasm from claiming extensive Also medium-. Span Undertakings Furthermore resource-based organizations Asiedu-Mante (2011).

The banks were hesitant on change their operations with suit of shield those needs of the worker farmers. Whatever they weredoing might have been gainful enough without directing, including the as far as anyone knows high hazard worker rancher and little-scale driver. Those little scale operators Furthermore worker farmers were Hence by and large dismissed What’s more were exited out to those leniency about casual division go-betweens ke cash lenders, „susu? operators, cocoa advertising cooperatives, and so on. , who charged usurious. Premium rates. This deflected prospective borrowers and had a tendency to dishearten indigenous business people Asiedu. -Mante (2011).

He explained the research design and sampling technique, method of data collection, research instrument, method of data presentation and analysis, validity and reliability of instruments by using different test techniques like ANOVA test and Model RR square. The researcher have suggested on the banking operations system for future researchers.

With enhance on the situation, the then existing customary business banks were supported to extend their limb organize under country areas, same time specific saving money foundations for example, those agricola improvemen bank (ADB) were made. However, these banks were unabated will fulfill the particular monetary needs of provincial dwellers a direct result they might not change their. Operations with suit of reinforcement those rustic group. Furthermore, the banks regarded that their operations were recently gainful without getting included Previously, country lending, which might have been observed with a chance to be thick, as expensive of the banks Asiedu-Mante (2011).

Baloch, Zahid and Naveed (2010), conducted a study on Information and Communication Technologies (ICT) and they concluded that Information Technology has revolutionized and transformed the business operation trends, and it has become a strategic marketing tool to enhance the competitive edge. Banking traditional operations has totally emerged with the use of ICT and replace with Electronic Banking concepts. E-Banking bringing too many challenges to the managers in achieving their customer satisfaction and leading to over-all objectives. They selected top five international banks, and data was collected from 251 E-Banking customers to judge their views regarding IT Usage, Ease of Usefulness and Ease of Use in the context of Customer satisfaction in order to investigate its parameters to make significant managerial decisions. 

Twum (2012) has come up with a study on how e-banking can enhance customer’s online experience which is affected by trust and security issues. This study provides a clear view for users and nonusers on e-banking security with a clear view to understand the trust and security factors. The study also states that online banking should continuously aim at securing customer’s trust including the provision of security information and education.

 Moreover, Bucerzan (2010) emphasizes on the development of e-banking services during the last few years and the steady growth of online users. This paper is meant to emphasize various aspects of the risk to which the e-Banking user is disclosed to and stressing out the risk brought by the Phishing approach. Further, points out the necessity of educating the users towards the best management of a case which implies this particular kind of risk or even towards the avoiding of the risk presumed by the use of e-Banking online services.

Local Literature

AlSoufi and Ali (2014), their study is based on Customers’ perception of m-banking adoption in kingdom of Bahrain, an empirical assessment of an extended tam model. Mobile applications have been rapidly changing the way business organizations deliver their services to their customers and how customers can interact with their service providers in order to satisfy their needs. The model was evaluated using a sample survey of 372 customers. The results reveal that the intention to adopt mobile banking is mainly affected by specific factors which are: Perceived Usefulness and Ease of Use. On the other hand, some factors such as perceived cost and perceived risk did not show any effect on the users’ intention to use mobile banking. According to their conclusion the research is beneficial for banking service managers to consider the factors that can enforce the Mobile Banking services adoption and increase the take-up of their mobile services.

Another study by Karim and Hamdan (2010), in which they examines the effects of information technology on banking industry for the period of 2003-2007. The research examine the level of using IT by 15 Banks for a period of five years, then explore the impression on improving the performance of two forms of matrix. The first is matrix of financial performance which comprises Market Value-Added (MVA), Return on Investment (ROI) and Earning per Share (EPR) and the second is matrix of operational performance, which includes the Net Profit Margin (NPM), Operating Return on Assets (ORA) and Profitability of Employee (PE). The results of their research indicated that there is an impact on the use of MIS in banks in the market value added (MVA), Earnings per Share (EPS), Return on Assets (ROA), Net Profit Margin (NMP).

Nawafleh (2015), his study examines the impact of information technology on banks’ profitability. The data were collected through two type questionnaires distributed at the clients and banks’ staff. The data were analyzes using SPSS, Averages and Standard Deviations test, Tree Cluster Analysis, and T-test for one sample. The study found that demographical characteristics affect affects the obstacles of using E-banking, and the capital of the commercial banks has a significant impact over their expansion.

Alwashahi (2016), has carried out an extensive investigation into the impact of the information technology (IT), on the performance of banks. The investigation has been done on eight important banks. The work has unearthed that , the nowadays the growth of IT field has penetrated the banking sector, which in turn, has accelerated the performance of banks on one hand and the customer satisfaction on the other. At the end, there are some recommendations for further improvement of IT system in banking sector. The study is an empirical research based on the survey method. Both primary and secondary data will be collected for the purpose of the study. The researcher has proposed to collect primary data both from samples of banks and their customers through structured questionnaires. The secondary data regarding the theoretical aspects of IT strategies in the banking sector, will be collected from recognized text books, journals, newspapers, research articles and research works and from relevant websites.

Al Somali (2009) presents many interesting insights in terms of online security. The author enumerates that security and authenticity of transactions over the internet is a significant issue and it is an important factor that customers consider before adopting Internet banking. Also mentions that the customers may avoid e-banking as they perceive it as being easily susceptible to fraud. This perception can damage the customer’s confidence of online banking as a whole.

 Moreover, Sultan (2009) has also given some interesting perception regarding online security of e-banking. The author further mentions about the customer’s attitudes towards e-banking that are driven by trust, which plays an important role in increasing the usability within the e-banking environment. Also few customers avoided the adoption of e-baking because they are concerned about the safety and security of transactions over the internet.

According to Sohail (2003), he explains the incident of the fact that customers are worry to use e-banking services and at the same time, there are tight security measures that banks try to adopt before opening up to the Internet. Further, the author remarks that banks should offer their online customers several protection measures including careful reference to their authorized Web sites, verification via the use of a digital certificate, evidence of security protection displayed on the screen, protection of personal identification numbers (PINs) and passwords, virus 33protection, with 128-bit encryption and firewall implementation.

Morufu and Taibat, (2012) explored for banker?s observation looking into majority of the data innovation organization Previously, nigeria purposely to figure out how financiers recognize those profits and dangers connected with majority of the data innovation organization Toward investigating banks employees? discernment around electronic saving money Also its suggestions around bank service conveyance. Those consider Along these lines finished up that „government right will data? gives the idea as the mossycup oak vital profit Also danger individually same time diminished. Hr charge helter skelter fetches for benefits that would minimum paramount for profits What’s more hazard connected with electronic saving money. Over my own investigation a considerable measure of investigate worth of effort need to be carried out in place on battle the tests for data engineering confronted by business banks Furthermore different budgetary establishments done Nigeria, there is require for banks and the administration should instruct people in general in the utilization of internet saving money products, should contribute additional under majority of the data correspondence engineering organization base Furthermore to the administration to decrease expense for majority of the data correspondence innovation gadgets. Web saving money Also on the web saving money may be not yet formed to Nigeria, (Amaoko, 2012). Singh (2002) opined that innovation need presented better approaches of delivering saving money benefits What’s more. 18. 18 items will customers, for example, ATMs, Also web saving money (IB). Henceforth banks need found themselves during the bleeding edge from claiming innovation selection to as long as three decades. These transforms Furthermore developments in the managing an account industry have effect for administration quality, future of the saving money activities, and therefore its continually focused capability in the planet business sectors since setting off alongside engineering organization will be a standout amongst the practically vital variables for budgetary associations triumph by and large and banks specifically (Nyangosi, 2009).


Local Studies

Al Bastaki (2006) has preceded with a study on the security measures of online banking system. This paper includes the security requirement that needs to be satisfied for online banking users by providing goodness or the ability to assure that data have not been altered accidentally or used by any illegitimate parties. Furthermore, the author comments on the privacy and the ability to prevent the unlawful or unethical use of information to protect the security measures of the online banking users.

Moreover Karimi (2009) emphasizes on the fraud or a hacker that can negotiate the security of an online bank user. This risk is highlighted since the emergence of phishers whose hobby consists on attempting to fraudulently and collecting of personal information such as usernames, passwords and credit card particulars. These hackers not only lead to user’s monetary loss, but also violate user’s privacy.



The literature is related to the defining and analyzing the technology services implemented by banks and its impact on different aspects of banks. Which focuses on how information technology on banking sector has provided us with different IT tools providing easy access to banking systems. The study also states that the impact of information technology is very high in the service sector in general and in the banking sector in particular. The use of information technology has led to a sea change in the functioning of the banking sector over the world. The IT strategies have opened up new markets, new products, new services and excellent delivery of banking services. Gone are the days where the customers of commercial bank stood in a queue in front of the banks’ counter during the specified office hours for transacting any banking operations. But there is a different scenario in the present day IT era, where the customers visit the bank on the day of opening the account and are able to carry out all the banking operations in absentia through the use of IT based banking services such as Online electronic banking, mobile banking and internet banking. Further, the study also describe that the reduction in banking operation cost and increase in customers services has increase the productivity in banking sector. According to the literature review the transition from traditional to electronic means has not affected banks in the negative way, along with that it has saved the time of the customer’s by providing them with high security.


In foreign and local literature, the authors mentions about the impact of information technology on banking sector. The literatures talks about the importance and the positive effects of information technology, in providing satisfaction to the customers who are using online banking, internet banking and the other tools that are used by the banking sector . Furthermore, the studies mentions about the banks to improve on the services delivered to their customers, given them competitive advantages and reduce customer waiting time in the bank through prompt service delivery occasioned by the use of computer, also the IT has increased the productivity in terms of improved quality and variety of banking services.  In addition, the literature indicates that technological progress likely helped facilitate consolidation of the banking industry.


There aren’t any differences among the authors that are mentioned in the foreign and local literature as well as the study that are conducted by renowned scholars. Almost all the literature talks about the significance of information technology on banking sector and emphasis the use to IT tools in banking system. Though, there was only a slight difference seen on few researches about the increased rely on Information technology tools could be a security issue for customers, as they mostly rely on technology for their daily transactions.


Theoretical Framework

According to (Agbolade, 2011), business organizations and especially the banking sector are operating in an environment characterized by a complex and competitive climate. In most developed countries, technology is a central element to deal with challenges in modern banking, such as lowering costs and enabling efficiency improvements. Due to technological changes there are the many important variables which have contributed to the complete change in the patterns of the banking business in the era of globalization; technology has focused on the interest on banking sector to take advantage of the latest information technologies, communications and computers, and to change efficiently in order to invent banking services and the development of novel methods of submission.

Using the techniques of electronic banking such as home banking, e-banking services through the internet, to provide banking services that achieve advantages for both banks and customers in providing the banking products and services are increasingly seen in the banking industry which can thus be easily operated and digitalized. The variables that are dependent on the usefulness of customers and perceived usefulness are well anchored and the proposed theoretical framework is presented in Figure 1 below











Conceptual Framework


The conceptual framework for this study will be based on the input, process and output model of evaluation. It is also known as IPO. The conceptual framework is based on the impact of information technology on International Banks (HSBA and Citi bank) in Kingdom of Bahrain.

The input column represents the type of information technology used by the international banks in Bahrain and the impact of these technological tools on the productivity, profitability, liquidity and performance of the banks, along with the impact on the bank development and employees satisfaction.

The process column represents the interpretation of data based on primary and secondary sources. Gathering of data is generally done by questionnaire method and the collected information is interpreted and analyzed through statistical tools.

The output column represents the outcome of the research, which indicated the impact of information technology to international banks, i.e HSBC and Citi banks in the Kingdom of Bahrain, which has impacted the banks services more effectively by using technological tools