The increasing competitive pressure as a result of technological development, globalization, changing customer demand has led to survival challenges of many banks in Nigeria and demanded for improvement in quality of customer service and speed to enhance profitability, staff performance and cost reduction. Although many employees are using more of information communication technology (ICT) as part of their jobs, few studies have examined the impact of ICT on their performance. Specifically, the main aim of this study is to determine the impact of information technology on the performance of staff in Nigeria Banking Sector and using Keystone Bank Limited as a case study. This provides significant value for both practitioners and academics.

Data was collected using hand delivery of questionnaire survey approach, which is the primary data. The study used unsystematic random sampling procedure in selecting the respondents as the sample. A total of 60 questionnaires distributed, 52 respondents were found to be useable for further analysis representing approximately 87% valid response rate. Chi-Square (X²) technique was used to analyze the data.

The findings showed that a positive correlation exists between ICT and the performance of staff in Nigeria banks. This implies that ICT introduction and adoption in the banking industry has resulted to a proportionate increase in staff overall performance based on the technological factors, which has brought about increases in the skills of workers, staff productivity, communication rates and also help to reduce stress and workload within the bank. This is confirmed by the level of hypothesis and calculated value which revealed that an insignificant size of staff performance exist without the adoption of ICT.

The outcome of this study provides important information on the impact of ICT adoption on staff performance and their operations in Nigeria banking industry.

Cover page


Title page ii

Authorization iii

Certification iv

Dedication v

Acknowledgments vi

Abstract ix


1:1 Background to the Study 1

1:2 Statement of the Problem 4

1:3 Objectives of the study - 5

1:4 Research Questions 5

1:5 Research Hypotheses 6

1:6 Significance of the study 6

1:7 Scope of the Study 7

1:8 Limitation of the study 7

1:9 Operational Definition of Key Terms 8


2:1 Information Technology Concepts and Their Use in Banks 9

2:2 History of the Banking Sector in Nigeria and Advent of ICT 15

2:3 Reduction in Repetitive Work 17

2:4 Development of Information Technology in Banks 17

2:5 ICT in the Banking Industry 19

2:6 Effects of Information and Communication Technology (ICT) on Banking 23

2:7 Challenges Facing Nigeria Information Technology 24

2:8 Work Performance 25


3:1 Research Design 27

3:2 Population of the Study 27

3:3 Sampling Procedure and Size 28

3:4 Data Collection 28

3:4:1 Primary Data 29

3:4:2 Secondary Data 30

3:5 Questionnaire Construction 30

3:6 Validation of Instrument 30

3:7 Data Analysis 30


4:1 Presentation of Data 34

4:2 Analysis of Data 40


5:1 Summary of Findings 45

5:2 Conclusions 47

5:3 Recommendations 48

Bibliography 49

Appendix 53

Questionnaire 53



Background to the Study

Over the years, many innovations have taken place in the world. The most striking and most celebrated is the aspect of information technology. Organizations today are confronted with rapidly changing market condition indicated by high merger rate and strong competitors. Under these conditions, traditional management approaches that focus on financial figures and on centralized, analytical planning methods are considered to be insufficient for effectively steering the organization in a dynamic environment, Hoffman (2002). Recent management support approaches like balanced score card is aimed at providing a broader view of organizational performance.

The revolution in ICT has changed the banking sector operations from the traditional to presumably better ways with technological innovation that improves efficiency. ICT can enhance efficiency via its use and in recent times banks have been encouraged by the rapid decline in the price of ICT gadgets. This has perhaps increased the bank level of ICT usage (Ovia, 2005).The increase might have also been attributable to business environment that became relatively flexible to accommodate new forms of technological changes as a result of reforms in the country.

ICT encompasses computer systems, telecommunication, networks, and multimedia applications and it came into use in the late 1980’s replacing earlier terms like Electronic Data Processing (EDP), Management Information System (MIS), although the latter terms are still in use (Frenzel, 1996). ICT has transcended the role of support services or only electronic data processing; its

fields of applications are somewhat global and unlimited. Its devices especially the Internet through the World Wide Web (www) and modern computer email facilities have further strengthened early innovations like the telephone and fax. Other ICT devices include data recognition equipment, factory automation hardware and services, tele-computing and teleconferences using real time and online system (Adeoti, 2005). It is a concept that is having a remarkable effect on almost entire aspects of the human endeavors. This connotes that it involves the application of principles to engage physical component in achieving an intended goal. The convergence of computer and telecommunication after about four decades of applying computers to routine data processing, mainly in information storage and retrieval, has created a new development where information has become the engine of growth around the world. This development has created catch-up opportunities for developing countries such as Nigeria to attain desired levels of development without necessarily ‘reinventing the wheels’ of economic growth. This new technology has brought far-reaching revolution in societies, which has tremendously transformed most business (banking) scenes (Ovia, 2005).

Banking has become highly ICT based and because of its inter-sectorial link, it appears to be reaping most of the benefits of revolution in technology, as

can be seen by its application to almost all areas of its activities (Akinuli, 1999). It has broadened the scope of banking practices and changed the nature of banking as well as the competitive environment in which they operate. A broad opening has been experienced around the world for banks and they are currently taking due advantage of these innovations to provide improved customer services in the face of competition and faster services that enhance productivity (Akinuli, 1999; Ovia,2005).

The role of technology in the “information age” is well recognized by banks, businesses, industries, governments and as such has completely woven in to their organizational structure and strategic planning process. Previous research work shows that information technology has become the nervous system of banks today and as such Nigerian banks which do not have the means to deliver banking service online and real-time across all branches within the country and abroad will be termed uncompetitive.

The integration of banks structure, business processes and strategies by the use of specialized information technology is considered a vital part of performance management concept. It has to be ensured that, strategic changes trigger modification on the business process level and the supporting information technology, and that innovation on the information system initiates the adjustment of the company strategy.

Organizations in the financial sector especially banks strive to achieve creation goals for the benefit of their owners or clients. These goals may be expressed in terms of objectives which include among others, increasing revenue, improving services rendered, expanding the customer base, minimizing cost of operations.

Nigerian economy yearns for development. Irrespective of the fact that she is blessed with enormous natural resources, she remains one of the poorest countries in the world. Banks today are looked upon as vehicle of change for a much needed economic growth and development as it befits on banks to develop the most effective means of delivering effective, efficient and quality service that will help drive our awaited economic success. These can be made possible if and only if information technology is properly put to use in the banking sector.

The role ICT in the banking sector became of interest to this study due to the significant role it plays in the economy by stimulating economic growth through the intermediation of funds to economic agents that need them for productive activities. This function is very vital for any economy that intends to experience meaningful growth because it makes arrangements that bring borrowers and lenders of financial resource together and more efficiently too than if they had to relate directly with one another (Adam, 1998; Ojo, 2007).

Hence, Information technology has been acknowledged as the life wire of banks in the financial sector as it promotes and facilitates not just the organizational performance but also staff performance of banks in the country. These therefore call for a pre-requisite need to embrace information technology. It is in view of this that this research work attempts to examine the impact of information technology on the performance of Staff in Nigeria banking sector today.

Statement of the Problem

Banking has come of age and as such, competition has alerted banks to look for innovations that will make their staff perform better and keep their customers. As a result of the need for efficiency and effectiveness in the banking sector, the web is introduced and used mostly for commercial purpose through internet banking and information technology. The adoption of information technology in banking sector is owing to the fact that, linguistic barriers needed to be put to an end to enable easy and cheaper communication during transaction, to foster customer- bank relationship, increase customer satisfaction, improve operational efficiency, reduce the running cost, reduce transaction time, give banks competitive edge, provide security to investors fund and promotion of other financial services.

Despite the adoption of information technology in banking sectors today with its numerous objectives, observation has however shown that, not all the objectives have been realized and felt by users. It is therefore imperative for the researcher to establish the influence of ICT on the performance of staff in Nigerian banking industry, with particular reference to Keystone Bank Limited.

Objective of the Study

The broad objective of this study is to assess the impact of ICT on the overall staff performance in Nigeria Banking Sector.

The specific objectives of this study are to;

1. identify how the adoption of information technology affects the performance of staff in Nigerian Banking Sector (keystone Bank Limited).

2. examine the technological factors that can enhance the growth of Nigerian banks.

3. assess the effect of ICT on the performance of staff in keystone Bank Limited.

4. establish the relationship between ICT and Staff performance in the study area.

Research Questions

The study would examine the following questions;

1. To what extent does the adoption of information technology influence staff performance in Nigeria Banking Sector?

2. To what extent has ICT influence the performance of staff in Keystone Bank Limited?

3. What are the technological factors that can enhance the growth of Nigeria Banks?

4. How do we establish the relationship between ICT and Staff Performance in Keystone Bank Limited?


1. H0 (1): The adoption of information technology has no significant effect on staff performance in Nigerian Banking Sector.

2. H0 (2): There is no significant impact of ICT on staff performance in Keystone Bank Limited

3. H0 (3): There are no known technological factors that can affect the growth of Nigerian Banking Sector.

4. H3 (4) Information and communication technology has not led to improvement of relationship in the Bank hence, staff efficiency has not improved.

Significance of the Study

The significance of this research work is that it would explore the impact of information technology on the performance of employees in Nigerian banking sector with special references to Keystone Bank Limited context. This particular industry was chosen because of the rigor employees are made to go through in the industry in the course of meeting the targets of the management. This has affected the economic, social and private lives of the employees. It is intended to investigate whether employees’ performance is influenced by the technological innovation (ICT) adopted by the management. It is hoped that this study would contribute to the promotion of the existing frontier or boundary between ICT and banking sector.

It would also help to find out the reasons why banks today have to forgo the former ways of operation to modern banking such as e-banking and as such identify the problems arising from the operational system of commercial banks in Nigeria.

The knowledge that would be gained from this research work will assist management of banks to appreciate the importance and use of information technology to achieve the overall efficiency and effectiveness in operation.

It would as well contribute to existing literature by identifying the major barriers to the adoption of this innovation on banking operation in Nigeria and suggest how to address them.

It would also be a valuation tool for students, academic institutions, and individuals that want to know more about the impact and relevance of information technology in Nigerian banking sector.

Scope of the Study

This study will be limited to the influence of ICT on the operations of banking sector in Nigeria and how it affects the performance of employees. Specifically, the information in this research work is limited to the activities of Keystone Bank Limited. The field survey shall be conducted in Lagos because it is the commercial nerve center of the country.

Limitation of the Study

There are some of limitations of this study, despite the fact that Research would be successful. In any Research work, it may be impossible to take good care all problems involved, the only thing a Researcher can do is to consider those factors that are essential to Research. The actual limitation of the study is career pressure as well as time constraints due to other family commitment.

Operational Definition of Key Terms

1) Information: Information is a data that has been processed. It is also referred to data that have a particular meaning within a specific context, or data that have been processed in such a way to be useful to the recipients. Ayatse (2005).

2) Technology: According to the oxford advanced learners dictionary (7th edition) “technology is a specific knowledge used in practical ways in industry”. For example, designing new machines which are made to meet up the demand of current and future situation/trend.

3) Data: Data are facts, events and transactions, observations that describe a particular phenomenon. Ayatse (2005).

4) Computer: Computer is an electronic machine that can store, organize, and find information, do calculations and control other machines. It is also said to be an electronic data that accepts, process, stores and output data at high speed according to programmed instructions. Micro soft Encarta (2009).

5) Performance: Performance in this context entails how well or badly an individual/organization does something or how well or badly something works.

6) Bank: A bank is said to be an organization that provides various financial services to individuals like lending or keeping money for people. These banks provide security and comfort to customers.

7) Internet: This is an international computer network connecting other networks and computer from companies, universities etc. It is termed as a massive connector of network linking millions of computers.

8) Communication: This is the transfer of information from one point to another either electronically or non-electronically, with the information being understood by the receiver.



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