Assessing the Impact of Electronic Banking on the Financial Performance of Commercial Banks in Ghana

Dr. Edward Domina Attafuah, Dr. Lord Emmanuel Yamoah and Mr Godfred Amoako
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Dr. Edward Domina Attafuah: Accountant, University Health Service, University for Development Studies, Senior Tutor- New Life College, Member Institute of Directors
Dr. Lord Emmanuel Yamoah: Lecturer, Takoradi Technical University, Procurement and Supply Chain Department, Member Institute of Directors
Mr Godfred Amoako: Senior Audit Supervisor, Japan Motors Trading Company and Associates

International Journal of Research and Scientific Innovation, 2024, vol. 11, issue 5, 422-441

Abstract: The use of computer and communication networks to provide a variety of value-added goods and services to bank clients is known as electronic banking. Therefore, e-business is transforming the way that business is done across all industries, and commercial banks are no different from other businesses in this regard. The introduction of electronic banking services has shown to be a key advancement in the banking sector in Ghana. In light of this, the study looked into the connection between Ghana’s commercial banks’ performance and e-banking. The specific goal of the study was to determine whether there is a relationship between the independent variables—such as the number of ATMs, debit and credit cards issued to customers, point of sale terminals, and the amounts of e-banking usage such as electronic funds transfers, mobile banking, and internet banking—and the dependent variable, such as performance as measured by profit after tax. The findings of the study were that e-banking has a strong and significant effect on the profitability of commercial banks in the Ghanaian banking industry. Thus, there exists a positiverelationship between e-banking and bank performance. The significance test showed that theinfluence of bank innovations on bank profitability was statistically significant meaning that the combined effect of the bank innovations in this research is statistically significant in explaining the profits of commercial banks in Ghana. The study recommends to the management of those banks that are slow in innovation adoption, to move in and adopt various innovations in their operations to shore up their profitability. It also recommends that Government policymakers should review policies related to the promotion of innovation adoption and transfer of technology. Adoption of innovations will improve the profitability of organizations because it will translate to better tax revenues for the government.

Date: 2024
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