ASSESSMENT OF ELECTRONIC BANKING IMPLEMENTATION IN SELECTED COMMERCIAL BANKS IN ETHIOPIA

Abstract

The study evaluates the implementation of E-banking technology in the Ethiopian selected commercial banks. Population of the study consist 3 selected commercial banks that have operated in 2023. The study was conducted based on the data gathered from three private commercial banks in Ethiopia. Purposive sampling method was used to draw the sample from the population. A qualitative research approach was employed to answer the research questions that occur through the review of existing literature and the experiences of the researcher in respect of the E-banking technology in Ethiopia. The study statistically analyzed data obtained from the survey questionnaire. A research framework developed based on technology-organization-environment framework to guide the study. The result of the study indicated that, challenges to the use of e-banking technologies in the selected banks, advantages, have those selected banks received as a result of their implementation of e-banking technology, the driving forces for the implementation of electronic banking technologies in the selected banks, opportunities in selected banks for the use of e-banking technology. The study identified operational and services benefits from implementation of E-banking technology such as increase productivity, reduces paper work, reduce transaction cost, generate foreign currency, increase reliability and reducing errors as operational benefits and facilitate development of new products, facilitates marketing and market access, improve customer service, reduce long queues in banking halls, increase accessibility of the bank services, create good relation among banks and clients and encourages price transparency as services benefits. Among the different driving forces that initiate Ethiopian banks to implement and extend E-banking technology: desire to improve performance, desire to improve the relationship with customers, rapidly changing customers’ needs and preferences, desire to improve organizational performance, desire to cover wide geographical area, desire to build organizational reputation and desire to reduce transaction cost are among others. The study also indicated existing opportunities for E- banking implementation such as improvement in the banking habit of the society, late implementation of E-banking, commitment of the government to facilitate the expansion of ICT infrastructure and commitment of the government to strengthen the banking industry. The study recommended banks to facilitate proper and continuous ICT and business training for their employees, increasing security for E-banking products, create deep awareness about E-banking technology to the community while the government should support banking sector by facilitating sufficient ICT infrastructure development and issue clear and workable legal frameworks to ease the implementation of E-banking Technology in Ethiopia.