Use Of Communications Technology

Published Date: 02 Nov 2017

INTRODUCTION

1.1 BACKGROUND OF STUDY

Electronic banking refers to the use of communications technology particularly the internet to buy, sell and market goods and services to customers. The internet has brought about a fundamental shift in national economics others that isolated by barriers to cross- border trade and investment, isolated by distance, time zone and language, isolated by national differences in government regulations, culture and business system (Mohammed, 2004).

Internet banking offers a level playing ground for large business, as well as small and medium scale enterprises (SMEs) to operate in global market place, and for regional business and communities to participate in social, economic and cultural network seamlessly across international boundaries (Mary-Anne, 1998). It equally foster direct access to distance market and promotes globalization of commercial activities, and blurs many of current distinctions between domestic and foreign companies to an extent that it becomes practically impossible to determine the original of product (George,1997). Hitherto, multinationals that operate in number of countries had to adjust their products and services to accommodate the divers operating environment at relatively high cost which the virtual market place has reduced.

However, with paradigm shift in the mode of operation occasioned by the advert of the internet, global corporations now operate with much consistency and at reduced cost of transactions as if entire word was a single entity. The internet has changed the face of businesses and is providing the customer with the ability to bank, invest, purchase, distribute, communicate, explore, and research from virtually anywhere, anytime there is internet access (Amp,1997).

The public nature of internet has made it vulnerable to a lot of security threats. Thus it requires a systematic approach to generate its security on front Web client, date transmission, Web server, and network server operating system. Similarly, moving business online requires efficient management of operations in the context of security (integrity, on repudiation, encryption), confidence (credit payment, confidentiality), and control (traceability, transparency, authenticity) (Romaswami, 1998; and Larry, 1998)

1.2 THE BACKGROUND OF STUDY

The ability of Nigeria bank to satisfy and retain their customers in present post-consolidation era will no doubt depend largely on development of their information technology (IT) infrastructure. In the bid to catch up with global developments and improve the quality of their services delivery, Nigeria banks have invested much on technology, and have widely adopted electronic and telecommunication network delivering a wide range of value-added products and services. They have, in the last few years, transferred from manual to manual to automated systems.

The numerous advances in internet technology has made considerable impact in business environs and in particular brought about a shift in banking operations. This has necessitated the adoption of internet banking, banks are able to work effectively and make huge profits. The chief driving forces of internet banking among customer include operation at the comfort of their homes and office anywhere, Ovia (2003) posited that the type of e-banking-commerce, and e-everything is gradually being embraced by Nigeria financial institutions where poised to be in the vanguard of narrowing the digital divide.

1.3 STATEMENT OF PROBLEM

Internet banking normally allows you to transfer funds between accounts, pay bills and set up standing orders and other such services at your own freewill and anytime you wish to-but the Nigerian economy is larger cash- base with over 90% in circulation. Thus payment for goods and services is mostly by cash to reason largely attributed to ignorance, illiteracy and lack of infrastructure to guarantee availability and security of transactions (Ojo 2004, Ovia 2002, and Bickerstem 2005).

Part of the reasons identified for the inability of banks in Nigeria to take full advantage of this mode of banking includes lack of adequate operational infrastructure like telecommunication and power, upon which e-banking generally relies. Addition, the fact that internet usage in the country has been abused by cyber-criminals makes its window unattractive for domestic banking operation and legitimate international operation. Payment cards with origin from Nigeria are rejected outside because the level of internet fraud and advance fee fraud know as 419.

1.4 OBJECTIVE OF STUDY

The main objectives of this work include an assessment of the over-view analysis of Nigeria internet banking, an assessment of its participation as a medium of delivery of banking services and as well as the performance of the Information Technology (IT)in the growth of the bottom line of organization. Also, it unveils the standards set by the CBN on the bases of regulating the internet banking system. Finally it further includes the assessment of the regulatory deficiencies, the rising cases of internet frauds that originated from Nigeria.

1.5 SIGNIFICANT OF STUDY

An over-view study of safe internet practice.

Exposition of the limitation of internet banking development in Nigeria banking system.

The understanding of internet banking as clear global advantage.

The analytical study of the necessary ways through which fraud practice in Nigeria internet banking can be control

Finally, the steps for a fruitful regulation.

1.6 RESEARCH ANALYSIS

The findings to be analyzed in this work are

1. The Extent of Adoption of ICT Product in Nigeria.

2. Rate or Adoption of ICT on Old and New Generation Banks.

1.7 LIMITATION OF STUDY

The subject is quite topical in Nigeria in view of the fact that technologically, it embraces a very broad field. Because of the dynamic nature of the concept of the electronic banking on commercial banking services will be discussed in this study.

Also, availability of relevant text that covered the Nigeria situation posed a great problem. The author was only able to lay hands on seminar materials delivered by some banking scholars and journals written on internet banking and commerce. Which did not treat the topic fully? The issue of withholding information on company’s operations reared its ugly head in the course this study.

Most bank officials were not comfortable of letting information on their operations and services. Some of the materials needed from them were not easy to get or made easily available. The limitations given above are generally considered normal for study of this nature and in an economic situation like ours.

1.8 SCOPE OF STUDY

This study is generally focused on internet banking practice (electronic banking) of commercial banks within a big commercial bank in eastern part of Nigeria. This is done out of the fact that commercial bank are usually more involved with through their retail banking services. The choice of the location was also as a result of large volume of commercial activity going on there, in the recent past.

The study of some selected commercial banks would enable us generalize about the challenges of electronic banking in the industry since the advert of the concept. Also the systems are inter-related and interwoven

1.9 DEFINITION OF TERMS

BANKING: The Paton commission defined banking as business of receiving from the public on current account, money which is to be payable on demand and of making advances to customers. This in the Nigeria context; Banking: any person, who carriers on banking business as defined.

BOFID 1991 defines banking as "the business of receiving money from outside sources as deposits irrespective of the payment of interest and the granting of money loans and acceptance of credit or the purchase of bills and cheques or the purchase and sell of securities for account of others or the incurring of obligations to acquire claims in respect of loans prior to their maturity, of the assumption of guarantees and other warrantees for others; or the effecting of transfer and clearings and such other transactions as the minister may on the recommendation of the Central Ban by published in the Federal Government Gazette designed as banking business".

INTERNET: Oxford Advance Learner’s Dictionary defined internet as an international computer network connecting other networks and computer. It is also defined as; inter-connection of network.

ONLINE BANKING: Is the flexibility of operating an account in any branch of a bank irrespective of which branch the account was domiciled.

INTERNET BANKING: It is the process, through which all the main banking services with the added flexibility of being able to manage your banking online,

ELECTRONIC BANKING: Refers to the use of Communication Technology particularly to buy, sell and market goods and services to customer

INFORMATION AND COMMUNICATION TECHNOLOGY (ICT): Is the modern handing of information by electronic means which involve access to, storage of processing, transportation or transfer and delivery (Oge, 1995)

REFERENCES

Agboola A.A, (2006): Electronic payment system and tele-banking services in Nigeria, Journal of tele-banking and commerce, Obafomi Awolowo University, Ile-Ife, vol.11, no.3.

Ayo Charles K, (2006): The Prospect of E-commerce implementation in Nigeria, Journal of internet banking and commerce, Dept of computer and information services, Covenant University, Nigeria vol.11, no.3.

Chiemeke S.C. and Chete F.O, lectures (2006);The Adoption of internet banking in Nigeria, Journal of internet banking and commerce, University of Benin, Benin city, Nigeria vol.11,no.3.

Evwiekpaefe, A. E., lecturer (2006): The adoption of internet banking in Nigeria, Journal of internet banking and commerce, Department of computer science, Nigeria Defence Academy, Kaduna, Nigeria, vol,11no.3.

Ogechi Nwosu (2005): Internet Banking; The history of online banking, The Financier 14th Edition, Publication of National Association Banking And Finance Student (NABAFS) University Of Nigeria Chapter, PP.30-31.

CHAPTER TWO

2.1 LITERATURE REVIEW

Laudon and Laudon (2001) pointed out that the world largest and most widely used network is the internet. Internet is the main vehicle for public Computing (PAC). Internet offers an excellent environment for banks to experiment with the delivery of home banking (Bill, 1996).It has been used develop, virtual banking in the United States of America. A prototype of this the Electronic Courtyard development by the Global Payment System Visa and the vs. Software Firm Worlds Inc. It allows customers to cheque account balances, transfer funds and apply for loans. It uses three – dimensional graphics to enable customers to move into different rooms and communicate with virtual bank tellers, loan arrangers and financial advisers. It uses Visa remote banking subsidiary, visa interactive, to link banks with customers and provide secure technology for the safety of account data transferred.

The level of participation on the web varies among banks; many banks do not go beyond putting up assign (company logo and contact telephone Number) on the web. Some banks go a little further by offering information about them and their products (annual report, description of their products and card products) to allow customer access to information I n a single place instead of scattering them in many records and documents. Payment through the internet will continue to expand in the next development because it is very cheap and some only cost the electricity that they use.

Lynda (1999) defines Electronic Home and Office Ban king (RHOB) as a subset of the business to customers and could be reduced, sometimes dramatically, by conducting actions over the internet. Loudon (2001) observed that internet is reshaping the daily life. By eliminating many technical, geographical and cost barriers obstructing the global flow of Information the internet is accelerating the information revolution inspiring new use of information systems and new business models.

One major attraction of internet and other tele-banking device is that they have facilitated Electronic Home and Office Banking (EHOB). This device enables customers to carry transaction with their bank through VSAT (Very Small Aperture Terminal) VSAT is a satellite communication system that serves home and business users. Customers with such terminals are able to contact the work for any form of information required. Information on bank balances, deposits into withdrawals from accounts etc may be gotten through this medium. EHOB thus allows customers to keep a very firm grip on their financial transactions with EHOB, this allows customers to keep a very firm grip on their financial transactions. With EHOB, customers can do their banking not only when but also from the convenience, comfort, privacy, and security of their homes.

2.2 THE CONCEPT OF ICT IN NIGERIA BANKING SYSTEM

Information and communication technology (ICT) is the modern handling of information by electronic means which involves access to, storage of , processing, transportation or transfer and delivery (Ige1995) it is acquisition, processing, storage and dissemination of vocal, pictorial, textual and numerical information by a micro-electronic based combination of computing and telecommunication (Lucey 1987). The focus of ICT is on telecommunication and computerization (Lucey1987). It implies the convergence of computing and communication (Telecommunication) technologies and its uses or application for global internet, internet, Extranet World Wide Web (WWW), Visual reality cyberspace- the New Digital Mentality and culture (Uwaje 2000). Communication Technology comprises the physical devices and software that link (connect) various computer hardware components and transfer data from one physical location to another (Laudon and Laudon; 2001). Connectivity has facilitated the use of electronic delivery financial transaction. Channels Distances and geographical location are no longer barriers to financial transaction.

2.3 CBN GUIDELINES ON ELECTRONIC BANKING IN NIGERIA

PREAMBLE

The CBN recognizes that electronic banking and payment services are still at the early stage of development in Nigeria. Arising from the three major roles of the CBN in the areas of monetary policy; financial system stability and payments system oversight, the CBN Technical Committee on E-Banking has produced a report’ which likely impact of the movement towards electronic banking and payments on the achievement of CBN’s core objective. Following from the findings and recommendations of the committee four categories of guidelines have been developed as follows:

Information and communication technology (ICT) standards, to dress issues relating to technology solution deployed, and ensure that they meet the needs of customer the and international best practice in the areas of communication, hardware, software and security.

Monetary policy, to address issues relating to how increase usage of internet banking and electronic payment delivery channels would affect the achievement of CBN’s monetary policy objectives.

Legal guidelines to address issues on banking regulation and consumer rights protection.

Regulatory and Supervisory, to address issues that, through peculiar to payments system in general, many be amplified by the use of electronic media. The guidelines are expected to inform the future conduct of financial institutions in e-banking and electronic payments delivery. A detailed report of Technical Committee on e-banking, which resulted in these Guidelines available separately.

THE GUIDELINES

TECHNOLOGY AND SECURITY STANDARD

CBN will monitor the technology acquisition of banks, and all investments in technology, which exceed 10% of free funds, will henceforth be subjected to approval where banks use third parties or outsource technology, banks are acquired to comply with the CBN guidelines

STANDARDS FOR COMPUTER NETWORKS & INTERNET

Networks used for transmission of financial data must be demonstrated to meet the requirement specified for data confidentiality and integrity.

Banks are required to display a proxy type fivrewall to prevent direct connection between the banks back end system and the internet.

Banks are required to ensure that the implementation of the firewalls address the security concerns for which they deployed.

For dial up services, banks must ensure that modems do not circumvent the firewalls to prevent direct connection to the bank’s back system.

External devices such as Automated Teller Machines (ATMs), Personal Computers, (PCs) at remote branches, kiosks, etc. Permanently connected to the banks network and passing through the firewall must at the minimum address issues relating to non- reputation, data integrity and confidentiality. Banks may consider authentication via Media Access (MAC) address in addition to other methods.

Banks are required to implement proper physical access controls over all network infrastructures both internal and external.

STANDARDS ON PROTOCOLS

Banks must take additional steps to ensure that whilst the web ensures global access to data enabling real time connectivity to the bank’s back-end systems, adequate measures must be in place to identity and authorize users while limiting access to data as defined by the Access control list. Banks are required to ensure that unnecessary services and ports are disabled.

STANDARDS ON DELIVERY CHANNEL

INTERNET BANKING

Banks should put in place procedures for maintaining the banks Web site which should ensure the following:-

Only authorized staff should be allo9wed to update or change information on the web site.

Update of critical information should be subject to dual verification (e.g. interest rates).

Web site information and links to other web sites should be verified for accuracy and functionality.

Management should implement procedures to verify the accuracy and content of any financial planning software, calculators, and other interactive programs available to customers on an internet web site or other electronic banking service.

Link to external web sites should include a disclaimer that the customer is leaving the bank’s site and provide appropriate disclosures, such as noting the extent, if any, of the bank’s liability for transactions or information provided at other sites.

Banks must ensure that the Internet Services Provider (ISP) has implemented a firewall to prospect the banks web site where outsourced.

Bank should ensure that installed firewalls are properly configured and institute procedures for continued monitoring and maintenance arrangements are in place.

Banks should ensure that summary –level reports showing web-site usage, transaction volume, system problem log, and transaction exception reports are made available to the bank by the web administrator.

2.4 CONSUMER INFORMATION

There is a lot should know about internet banking. It can save you time, and effort, but it’s important to protect yourself from potential pitfalls. Below is information on banking options, different types of online banking, services and advantages protecting your privacy, "Cookies" and privacy, security, regulations that protect consumers, and filing a complaint against a financial institution.

Banking Consumers’ Options

-Two Different Types of Online Banking.

-What Internet Banking Offers- Services and Advantages

-Protecting Your Privacy

-How "Cookies" Could Affect Your Privacy

-Security Tips- How to Protect Your Personal Information

-Is E-mail Safe?

OTHER SECURITY TIPS

CONSUMER REGULATION THAT PROTECT YOU

How to file a Complaint Banking Consumers’ Options.

They can go to a tradition "brick and click" institution that has a building and personal service representatives, but doesn’t offer internet banking services, or you can choose a "virtual" bank or financial institution that has physical structure, and also offers internet service or you can choose" Virtual bank or financial institution that has no public building and exist only online.

Internet banking, and other types of online banking, offers advantages such as speed and convenience. But sine and security issues. Knowing the "Do’s and Don’ts" of internet banking can help make your online banking experience more productive, safe and enjoyable.

TWO DEFERENT TYPE OF ONLINE BANKING

Internet banking is usually conducted through a personal computer (PC) that connects to a banking web site via the internet. For example, a consumer at home accesses a financial institution’s web site via a modern and phone line or other telecommunication connection, and an internet service provider.

Internet banking also can be conducted via wireless technology through both Personal Digital Assistants.(PDAs) or Cellular phones.

2.5 WHAT INTERNET BANKING OFFERS

Services and Advantages

As a consumer, you can use internet banking to: Access account information, review bills, pay bills, transfer fund, apply for credit or trade securities. You can find out when cheque has been cleared or when bills are due. You can apply for mortgages, shop for the best loan rates and compare insurance policies and prices. And you can do all of these things anytime you want to- day or night.

Some people tie banking functions into personal financial software such as Intuit’s Quicken or Microsoft’s money. This can make record-keeping and tax preparation quicker and easier. Many consumers also like the idea of not waiting in line to do their banking and paying their bills without shuffling papers and buying stamps.

PROTECT YOUR PRIVACY

You need to be concern about privacy and security.

Consider when you bank via internet, your needs and interests. For example it might share information about your average checking account balance with an affiliate, selling life insurance or securities.

Financial institution has policies about the information they collect, how they use this information and with whom they share it. Financial institutions are required to provide customers with a copy of their privacy policy. Reviewing this policy can tell you what information your financial institution keeps about your information.

Do check for an ‘Opt Out’ option.

HOW ‘COOKIES’ W COULD AFFECT YOUR PRIVACY

Internet technology allows financial institutions and other websites to track your browsing habits while at their site. This may do using a small file stored on your PC called a ‘Cookies’. Tracking your browsing gives financial institutions information about your apparent interests and preferences. It helps them to potentially market goods and services to you base on these interests and preferences.

Do check your financial institution’s Web site privacy statement. Determine if the website uses cookies or otherwise track you browsing habits. If this tracking practice concerns you, PC’s Web browser may offer useful options. A web browser is program on your PC that enables you to browse website over the internet.

Check the preference or tools areas of the browser to for cookies. Your browser may offer the option to accept or reject it. Your browser may also you the option to reject all cookies. Just be aware that some website are design to function properly only when their cookies are accepted. Blocking cookies may prevent normal access to certain website or to some of their online options. If this happen, you can only accepting cookies again. Do check your browser’s options for accepting or rejecting cookies.

SECURITY TIPS

2.6 HOW TO PROTECT YOUR PERSONAL INFORMATION

Since internet is public network, it’s important to safeguard your banking information, credit card numbers, social security number and other personal information. Some customers have had credit card number and social number stolen and used fraudulently. Of course this can happen even if don’s bank online. By taking reasonable steps to n protect your personal information; you can reduce the chances that it may be stolen. Do ask your financial institution about its security practices. How does it safeguard your information during transmission and on their website?

Website site use Uniform Resource Locator (URL) as a kind of internet street address. You can tell browser which website you want to go to with URL. When a URL begins with http plus an "s" it identifies the site as ‘secure’ meaning that it encrypts or scrambles transmitted information. This prevents others from seeing your information when it travels over the internet.

Also, most browsers and web pages display a small icon of a locked padlock or a key to show that the site is encrypting your information during transmission. Your browser may also notify you when you entering a "secure" web site. Do make sure that your transmissions are encrypted before doing any online transaction and sending personal information.

Is E-Mail Safe!

E-mail is usually not secure. It’s not a good ideal to send personal information such as your social security number, personal identification number (PIN) or account numbers via e- mail, unless you know it is e encrypted.

Don’t send personal information by ordinary e- mail. Do change any passwords or Pins you received via e- mail that are not encrypted.

Other Security Tips

Dos

Do make sure you are on the right web site imposters have created web sites with similar names to trick unsuspending consumers into revealing personal information. Do make sure that the financial institution is properly insured. It should be insured by the Nigeria Deposit Insurance Corporation (NDIC). NDIC coverage only applied to deposit products such as saving accounts, checking accounts, and certificates of deposit (CDs).The coverage does not apply transaction involving mutual funds, stocks, bonds and annuities.

Do be "password Smart" when possible, use a mix of letters and numbers for added safety. Change your password regularly. Keep your password on PIN to yourself. Avoid easy- to guess passwords like first names, birthdays, anniversaries or social security numbers.

Do check banks, debit and credit card statements thoroughly every moth. Keep records. Save information about banking transactions. Check this information for agreement with account statements, debit card bills, and credit bills. Look for any errors or discrepancies.

Do report errors, problems or complaints promptly.

Do keep virus protection software up-to-date. Back-up key files regularly.

Do exist the banking site immediately after computing your banking.

Don’ts

Don’t have other browser windows open at the same time you are banking online. Don’t disclose personal information such as credit card and social security numbers unless you know whom you are dealing with, why they want this information and how they plan to use it.

Don’t download files sent by strangers or click on hyperlinks from people or sites you don’t know. Sometimes doing so infect your computer with viruses that can damage hardware or software.

Consumer Regulations That Protect You (in USA)

There are federal regulations that protect consumers against unauthorized transactions, including internet bank transactions as well as those conducted via an Automated Teller Machine (ATM) or using a debit card. The Electronic Funds Transfer Act, or Regulation, E, says a consumer’s liability for an unauthorized transaction is less determined by how soon the financial institution is notified. A consumer could be liable for the entire amount unless unauthorized transaction is reported or disclosed. The sooner the unauthorized transaction is reported, the les the level of liability, therefore, it’s important to report unauthorized transaction immediately to limit loss. It’s also important to remember that it might take time while the authorized transaction being investigated for money deducted from your account to be credited back to it.

The truth-in-lending Act, or Regulation Z, governs illegal credit card use. While bank transactions conducted over the internet are governed by Regulation E, credit card purchases over the internet are governed by Regulation Z. When making purchases via the internet, it’s smart to use a credit card. That’s because if a credit card is stolen or used by an unauthorized party. Liability should be no more than $50 if proper noticed is given to the credit card vendors. The vendor can be telephoned, but its best to follow up the call with a letter starting that the transaction was made by an unauthorized user, and detailing the account number and the dollar amount of the unauthorized transaction. Consumers do not have to pay the disputed amount during investigation. All financial institutions are also subject to Regulation P covering privacy and the Interagency Guidelines for Safeguarding Consumer Information.

2.7 EFFORTS OF THE CURRENT NIGERIA GOVERNMENT

The government had instituted a number of regulatory measures to curb the tide of frauds. These include; The National Drug Law enforcement Agency (NDLEA) Act of 1989; the failed Baud C. recovery of debt and financial malpractice of banks) Act of 1994 the money laundering Act of 1995; and the Anti corruption Act of 1999 (Ezeoha, 2006).

Similarly, the other bodies constituted to check the menace of fraud are: the National Cyber crime working Group (NCWG); the Economic and Financial Crime Commission (EFCC) among others. All these have not yielded much fruits because it takes more than legislation and enforcement to effect a change, but it also demands general attitudinal, culture and social change.

Government had equally instituted a number of systems to facilitate inter bank settlement and funds Transfer(NEFT); THE Nigeria Automated Clearing System (NACS); And the Society of Worldwide Inter bank Financial Telecommunication (SWIFT), of which Nigeria is a member.

According to Tooki (2006), the Nigeria consumers are gradually embracing the concept of card payment but reputation crisis is major impediment. However, with the attitudinal change and provision of adequate infrastructure, Nigeria has the potentials to be e-payment market leader in Africa (Gavin, 2006). Currently, inters witch is at the forefront of providing facilities for e-payment implementations in Nigeria. It operates an integrated, secured, audit table and open platform for financial transactions, e-commerce, telecommunications, value added services, e-billing and payment collection and monitoring (Inters witch). The other parties involves in the e-payment revolution include some banks, Switching companies, cards companies and the telecoms operations in Nigeria (E-PAYMENT Revolution,2005).

What has given the country a respite is the fact that Inters witch has currently been appointed a Gold partner by Thales e-security: a global industry in WAN data encryption (Oronsaye, 2006). By this feat, Inters witch will be handling the security infrastructure of west and central Africa region. Therefore, the problem of the country is not the technical know-how to safeguard a secure e-payment transaction but attitudinal.

2.8 SAFE INTERNET BANKING

Tips For Banking The Internet

As use of internet continues to expand, more banks and thrift are using the web to offer products and services or otherwise enhance communication with consumers.

The internet offers the potential for safe, convenient new way to shop for financial services and conduct banking business, any day, anytime. However, safe online involves making good choice- decision that will help to avoid costly surprises or even scams.

This brochure offers information and tips to help you if you are thinking about or already using online banking systems. We will tell you how to:

Confirm that an online banking is legitimate and that your deposit is insured.

Keep your personal information private and secure.

Understand your rights as a consumer.

Learn where to go more assistance from banking regulators.

Confirm that an Online Banking is Legitimate and that Your Deposit Are Insured.

Whether you are selecting a traditional bank or online bank that has no physical offices, it’s wise to make sure that it is legitimate and that your deposits are federally insured, Here are tips specially designed for consumers considering banking over the internet.

Read Key Information About The Bank Posted On Its Web Site.

Most banks web sites have an "About Us" section or something similar that describes the institution. You may find a brief history of bank, the official name and the address of the bank’s headquarters’ and information about its insurance coverage from the NDIC.

Site Protect Yourself From Fraudulent Web

For example, watch out for copycat websites that deliberately use a name or web address very similar to but not the same as that of a real financial institution. The internet is to lure you into clicking onto their website and giving your personal information, such as your account number and password. Always check to see that you have typed the correct web site address for your bank before conducting transaction.

Verify the Bank’s Insurance Status

To verify a bank’s insurance status, look for the familiar NDIC logo or the words "Member NDIC" or "NDIC Insured" on the website. Also you should check the NDIC’s online database of NDIC-insured institution by going to Bank Fund (formerly "Is My Bank Insured?"). Search by name, city, state or zip code of the bank, and click the ‘Find" button. A positive match will display the official name of bank, the date it become insured, its insurance certificate number, the main office location for the bank (and branches), its primary government regulator, and other links to detailed information about the bank does not appear on this list, contact the NDIC.

Some bank web sites provide links directly to the NDIC’s Web site to assist you in identifying or verifying the NDIC insurance protection of their deposits.

Also remember that not all banks operating on the internet are insured by the NDIC. Many banks that are not NDIC insured are chartered overseas. I f you choose to use a bank chartered overseas, it is important for you to know that the NDIC may not insured your deposits. Check with your bank or the NDIC if you are not certain.

For Insurance Purpose, Be Aware that a Bank May Use Different Name For Its Online and Traditional Service this does not mean you are Dealing with Separate Banks

This means, for example, that to determine your maximum NDIC insurance coverage, your deposits at the parent bank will be added together with those at the separately named bank Web site and will be insured for up to the maximum amount covered for one bank. Talk to your banker if have questions.

Know where to get more Information About FDIC Insurance (in USA)

Don’t worry about deposit insurance coverage if you or your family has less than $100,000 in all your accounts combined at the same FDIC-insured bank. But if your account total $100,000 or more, find out If they‘re within the insurance limit. Contact your bank for more information.

For additional assistance from FDIC about the legitimacy of an institution or the insurance of your deposits call the FDIC’s Division of Compliance and Consumer Affairs toll-free at 1-877-275-3342 or send an e-mail via the FDIC’s online Customer Assistance page. The FDIC’s Web site also have an iterative service called EDIE (Electronic Deposit Insurance Estimator) that can help you determine amount of your insurance coverage. Or, you can read the online deposit insurance brochure’ Your Insured Deposit."

It’s important to note that only Deposit offering by NDIC-insured institutions are protected by the NDIC. Non deposit insurance products, such as mutual funds stocks, annuities and life insurance policies that may be sold through Web sites or the bank itself, are not NDIC-insured, are not guaranteed by the bank, and may lose value.

REFERENCES

Abel Ebeh Ezeoha (2005): Regulating Internet Banking In Nigeria: Problem and Challenges part 1," Journal of Internet Banking and Commerce, Vol. 10, no: 3, December 2005 [Online], http://www.arraydev.com/commerce/jibu)

Adeyemi Yinka (2005): Nigeria now has a robots infrastructure for e-commerce takeoff, Federal Standard, vol16, No: 29, pg8, may 2005.

Agboola A.A (2006): Electronic Payment Systems and Tele-banking services in Nigeria," Journal of Internet Banking and Commerce, vol. 11, no: 3 December 2006.

Bickersteth S. (2005): Making e-commerce a reality in Nigeria," Financial Standard, Vol 7, no:1, pg5, Oct. 2005.

Central Bank Of Nigeria (2003): Guidelines On Electronic Banking In Nigeria," August 1, 2003.

David, R. (1982): IT and Banking System, Journal of the Institute of Banker, Headley Brothers Ltd London, vol. 103, no.3, pp.77-78.

Uwaje, C. (2000): The Challenges of Information Technology: Its impact and Role of women, Guardian; July 18, 2000.

CHAPTER THREE

3.1 RESEARCH METHODOLOGY

INTRODUCTION

Research has been variously defined in the Literature to mean a systematic effort at gathering and analyzing data which will aid man in understanding the world in which he lives and solve some of the problem around him. Anikpo (1986) defined research as a "systematic application of the scientific in a attempt understand and solve social problems. Research could either be simple or complex depending on the problems it is about to solve and the funds available for such an exercise.

3.2 RESEARCH DESIGN

The research design entailed the combination procedure of preliminary personal observations. For this study the observation developed was mainly on commercial banks to ensure objectivity in the data collection.

3.3 SOURCE OF DATA

The research will make use of secondary data from various editions from Central Bank of Nigeria, Journals and articles written by different Scorers, Economic and Financial review and Engine Search.

This approach is adjusted adequately because the information needed for the land of study are available in the Publication

The major task therefore is to assemble the data collected, examine and evaluate them within the framework of this project.

3.4 DATA COLLECTION METHOD

As said earlier on this analysis is based on secondary data and this type of secondary data used were collected from Central Bank of Nigeria, Articles and Journals written by Journals written by Scorers.

Since the method to be use is the ICT products, I easily extracted the ratio on ICT products of the commercial banks in their percentage and applied it into my data.

3.5 DATA ANALYSIS METHOD

This analysis compared the adoption of ICT in Old and New generation banks and shows on how extent the ICT products has been adopted in adopted in Nigeria banking sector.

First and foremost I took the totality of both commercial banks; the data collected are on ICT products/Electronic banking products for the present year.

REFERENCES

Afonga B (1982); Introductory Statistic, Evans Brothers Publishers, Ibadan, Nigeria. P.42.

Oyala A. (3rd edition) Published 1992 by Nobera Avocation Publishing Company Enugu. The Economist, Volume 334 Number 7904, March 4-10, 1995.

CHAPTER FOUR

4.1 ANALYSIS AND INTERPRETATION

The table below shows the extent. Of adoption of electronic payment devices in the commercial banks. The most widely adopter technology is the Local Area Network (LAN). Twenty four banks have fully networked their systems within the bank.

This mode communication of account information easy. MICR cheque was also highly utilized by the banks. Twenty four banks as well have fully adopted its use. Findings revealed that one of the earliest developments in the use of computers in banking was based on handling of cheques.

It was borne out of the desperate need to overcome the problem of handling the growing volumes of cheque. This agrees with the finding of (David 1982) that the most significant development in clearing system over the past decade has been the growth of Banker Automated clearing services.

Program for Daily Calculation of Account/, Wide Area Network (WAN) and Electronic Funds Transfer (ETF) also ranged high in adoption among the commercial banks Smart Cards, Point of Sale System and Computerized Credit Rating were not very popular, Few of the commercial bank had fully adopted them. The least fully adopted technologies have ATM with only 4(16,7%) and Telephone Banking with 5(2.07%).

Source: Research Survey 7/21/2008

Key:

Fully Adopted: No. of banks having the products at the headquarters and branches.

Partially Adopted: No. of banks having them only at the headquarters.

Not Adopted: No. of banks not having them at all.

Table 1: Extent of adoption of ICT Products

ICT Products

Fully Adopted (Weight=3)

Partially Adopted (Weight=2)

Not Adopted (Weight=1)

X

Automated Teller Machine

4

8

12

1.69

Electronic Funds Transfer

16

5

3

2.58

Smart Card

6

7

11

1.83

MICR Cheques

24

_

_

Local Area Network

24

_

_

Wide Area Net work

22

2

1

Point of Sales System

10

6

8

2.11

Electronic H0me Office

4

8

12

1.93

Telephone Banking

5

8

12

2.07

Make Cheque Available Program

7

7

10

1.92

Computerized Credit Rating

10

6

8

2.11

Daily Calculation of Account program

22

2

_

2.92

RATE OR ADOPTION OF ICT IN OLD AND NEW GENERATION BANKS

Table 2, shows that the rate of adoption between the old and new generation banks varied. Adoption of ICT products was higher among the generation banks, the products except MICR, Local Area Net work, Wide Area Network and Daily Calculation of Accounts program where all the studied banks have 100% rate 0f adoption. All new generation banks have adopted Electronic Funds Transfer Computerised Credit Rating and Daily Calculation of Accounts program. Non old generation banking and

Identified Products

Old Generation Bank

% Rate Adoption

New Generation Banks

Automated Teller Machine

10

50

1

Electronic Funds Transfer

20

100

4

Electronic Data Interchange

12

60

1

Smart Cards

12

60

1

MICR Cheques

20

100

4

Local Area Network

20

100

4

Wide Area Work

20

100

4

Point of Sales System

16

80

2

Electronic Home and Office Banking

10

50

0

Telephone Banking

15

75

0

Make Cheque Available Program

13

65

1

Computerized Credit Rating

20

100

1

Daily Calculation Account Program

20

100

4

REFERENCES

(Online), http://Cache. Search yahoo- h+2.akadns net/search /cache?ei UTF–8&p= extent of + adoption +of +ICT…..7/21/2008

David R. (1982): IT and Banking System, Journal of the Institute of Banking, Headley Brothers LTD, LONDON, vol. 103, no. 3, pp.77-78

Dr Agboola A.A (2006): Electronic Payment Systems and Tele-banking services in Nigeria," Journal of Internet Banking and Commerce, vol11, No :3 December 2006.

CHAPTER FIVE

FINDINGS, CONCLUSION AND RECOMMENDATION

5.1 FINDINGS

Findings revealed that there has been a very modest move away from cash. Some payments are now being automated and absolute volumes of cash transactions have declined, Connectivity via the use of Local Area Network (LAN) and Wide Area Network has facilitated electronic transfer of funds. Ninety five percent of the banks having fully networked their systems to ease communication of account in information. The use of Smart Cards, Point of Sales System and Computerized Credit Ratings were not very popular as less than fifty percent (50%) of the banks had fully adopted them. The least fully adopted technologies were ATM; Electronic Home and Office Banking and Telephone Banking. Low rate of adoption of these technologies might due to low level of economic development; ineffectiveness of NITEL, epileptic supply of power, high cost, fear of fraudulent practice and lack of facilities necessary for their operation.

The project discovered that INTERNET BANKING is capable of broadening the customer relationship, retain customer loyalty and enable banks to gain commanding height of market share if their attendant problem are taken care of.

5.2 RECOMMENDATION

For the essence of this research work; it has verified that the Electronic banking operations have continued to change payment systems in Nigeria. But a lot of efforts are however required to fully utilize its numerous capabilities for this reason the following are recommended;

Banks in Nigeria should explore the Internet more intensely to avoid themselves of the bountiful opportunities locally and globally. This can be done by utilizing the service of internet provider*(ISPs)

Banks should also ensure safety of financial transactions on the net and ATM via authentication. Authorization, data integrity, and non-repudiation and also well protected private networks should be employed were the source of the request for payment is recorded and proven

The Nigeria electric mains (Power Holding) should revitalized to provide more reliable electric power supply to the consumers, Meanwhile Alternative source of power such as generating plants should be used to avoid the damaging effect erratic power supply.

The national telecommunication carrier (NITEL) should be properly reengineered to improve on its efficiency in the provision of telecommunication service which give the necessary platform for full banking automation.

Finally, it is recommended the government and private initiative be encouraged to improve on this sector of the economy there is need for improved national image on the international arena and in appropriate legislation put in place to guide the operations of Web commerce.

Similarity, concerted efforts are required for the provision of basic infrastructure in the areas Web presence, Internet access, and e-payment.

The entire populace must be encouraged to embrace the e-banking culture as this will in turn reduce the amount of cash in circulation and boost the e-commerce culture.

5.3 CONCLUSION

As it stands, Internet banking might take a reasonably long time to fully become of economic relevance in the country’s banking practice. Even amidst the regulatory deficiencies identified above, the rising cases of Internet related frauds originating from Nigeria have made the Internet banking environment very complex. The banking industry in the country does not also at present enjoy that level of global banking service.

Hence in addition to the cases of poor access to the requisite facilities, very few customers actually transact business through the internet. The explaining why the development of banks web sites has not gone beyond information purposes.

A situation where banks would have invest much on acquiring information technology software without attracting enough customer patronage necessary to justify the huge expenditure does not for a progressive chance for rapid growth in Internet banking in Nigeria

With the deficiencies in the existing electronic banking guideline and the seemingly lack of proactive measure in other banking regulations in the country, the right environment for Internet banking remains presently not in existence.

REFERENCES

Agboola A.A (2006): Electronic Payment Systems and Tele-banking services in Nigeria," Journal of Internet Banking and Commercial Vol 11, no. 3 December 2006.

Ayo Charley. K; (2006): The Prospects of E-Commerce Implementation in Nigeria, Journal of Internet Banking and Commerce, vol.11, No 3, December 2006.