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THE REVIEW OF THE PROBLEM OF COMPUTER APPLICATION IN FINANCIAL INSTITUTION IN NIGERIA “(A CASE STUDY OF FIRST BANK IN DELTA STATE ASABA BRANCH)
The study examined the review the problem of computer application in financial institutions in Nigeria using First Bank of Nigeria. The population of the study consisted of all the residence of the staff of First Bank of Nigeria, Delta State, Asaba Branch. Simple random sampling technique was used to select 60 respondents out of the population. The instrument used for data collection was questionnaire. The instrument was validated by two experts in Test and Measurement. Data from 60 completed questionnaires was subjected to Chi-square. The findings showed that virus attack, poor network, irregular, power supply and application failure impact of computer application are the problems of computer application in financial institutions in Nigeria especially First Bank of Nigeria, Asaba branch. The recommendations were that in order to provide the data security against unauthorized access to the network and high reliability of it which involves(ensures) the consistency and continuity of service, in such a way that by providing communication quality, the information(data) are transmitted without error, The appropriate equipment and technology (including network, hardware and software) should be used.
1.1 Background of the Study
The efficiency, safety and reliability of a country’s payment system facilitate the ability of her Central Bank (being the apex financial regulatory body) in bringing a sound and stable financial system. Hence, the provision of an atmosphere conducive for customers to make payments continued to form the basis of any well-functioning financial system. In Nigeria, cash as a means of payment continued to remain the most widely used in the settlement of commercial transactions. Indeed, in many parts of Nigeria, particularly in the rural areas, cash is still the only mode of payment. To change this habit towards the adoption of non-cash modes therefore requires some massive reorientation both attitudinally and culturally in the minds of our rural populace. It is in recognition of this critical need that forms the basis of this paper which is also considered to be timely.
It is noteworthy however, that in the recent years, the proportion of cash in effecting payments has drastically reduced in favour of non-cash alternatives. The CBN reported that the value of electronic card (ATM card) transactions rose by 32.8 per cent to N1, 014.71 billion in the first half of 2012, up from N764.14 billion in the first half of 2011, while the volume increased from 167,962,665 in the first half of 2011 to 185,078,223 in the period under review.”
Fundamental to the growth of internet banking and e-payment (which are non-cash payment system instruments), is the confidence which the public now has in its convenience and security, mainly through some collaborated efforts of the Central Bank of Nigeria with other commercial banks and other stake holders in developing the framework and necessary infrastructures for a gradual migration from cash to non-cash payment modes.
Computer application is a computer software that enables a computer to perform useful tasks beyond the running of the computer itself (Magazine,2013). A specific instance of such software is called a software application, application program, application or app (Magazine, 2013).According to Hally (2005), banking software or business application is any software or set of computer programs that are used by financial institutions to perform various business, financial and accounting functions. These applications such as; human resource management software, management information system, customer relationship software, accounting software, enterprise software, employee database are used for Inventory control and purchasing, marketing, deliveries and receiving, sales analysis, maintenance of stock, point of sale and invoicing, staff time, attendance and payroll to increase productivity, measure productivity and to perform business functions accurately (Hally, 2007).
Application software is software designed to perform a group of coordinated functions, tasks, or activities for the benefit of the user. Examples of an application include a word processor, a spreadsheet, an accounting application, a web browser, an email client, a media player, a file viewer, an aeronautical flight simulator, a console game or a photo editor. The collective nounapplication software refers to all applications collectively. This contrasts with system software, which is mainly involved with running the computer Zanta, (2005).
For the past two decades, the banking sector has chosen a new service channel based on the progress of information technology – internet to respond to the changes in customer preferences and needs, increasing competition from non-banks, changes in demographic and social trends, and government deregulations of the financial service sector (Byers and Lederer, 2001). In the search for sustainable competitive advantages in the technological financial service industry, banks have acknowledged the value to differentiate themselves from other financial institutions through new service distribution channels (Daniel, 1999).
In addition, customer’s transaction and communication abilities have been improved by the developments of information technology. Information technology enabled electronic channels to perform many banking functions that would traditionally be carried out over the counter (Giannakoudi, 1999). The rise of electronic payments media such as debit and credit cards has caused the value of paid in the USA to fall to – from about $49 billion in 1995 to about $42 billion in 2002 (Gerdes and Walton, 2002).
The use of paper cheques has been supplemented step-by-step with e-cheques (i.e., electronic images) allowing banks to have more storage capacity, reduce costs, and improve Furthermore customer services (Rose and Hudgins, 2005).
A more recent e-banking development is wireless internet applications of banking sometimes called mobile banking (Choi 2006; Scornavacca and Hoehle, 2007). With the combination of two most recent technological advancements – internet and mobile phone, a new service (mobile data service) is thus enabled and the first such wireless internet commercial transaction is performed by the banking industry (Barnes and Corbitt, 2003). It is believed that mobile banking will provide another new channel for banking services, especially for certain remote areas where online internet is still unavailable. Strategic implications and customer perception of mobile banking services are explored (Laukkanen and Lauronen, 2005) with a focus on the consumer value creation and a better understanding about the customer-perceived value of mobile banking services. For instance, mobile internet service has been quite popular in Nigeria(over 60 millions users since 2003 (Scornavacca and Barnes, 2004).
Due to the widespread use of computer technologies in almost all aspects of life, organizations that are connected to the Internet started extending their services to their customers to include new applications and services that satisfy their customers’ desires to make better businesses. One of these emerging applications is mobile banking. The term mobile banking (or m-banking) describes the banking services that the user can perform via a mobile device ubiquitously at anytime and from anywhere. In order for users to access their accounts, they need a mobile device and network connectivity. Therefore, sitting in front of a computer is not a requirement anymore; accessing accounts can occur while users are waiting their turn at the dentist clinic or relaxing at the beach! (Al-Akhras and Qwasmi, 2011).
Computer application plays a key role in today's business environment. As such, companies greatly rely on computers and software to provide accurate information to effectively manage their business (Kroll, 2007). Also, it is becoming increasingly necessary for all businesses to incorporate computer application to operate successfully, and one of the ways that many corporations have adopted computer application, is by installing computer software or applications to accomplish their business transaction and data processing needs (Morgan, 2002).
The concern about the impact of computer application on banking is great, because computer application on banking is a global phenomenon which leads to the survival of businesses (Miller, 2006). Financial institution organizations over the years have introduced several computer applications to improve operations, and it is in line with the spirit of improving business that banks make several efforts to improve business through computer applications such as; human resource management software, customer relationship software, accounting software, employee database, management information system, inventory management, and payroll software etc. to address the problem of computer application in business (Miller, 2006).
1.2 Statement of the Problem
It is a basic fact that computer application has been a backbone on the development of any banking institution around the world (Gibbs, 1997). In this study, it has been observed that various financial institution and related organizations have initiated series of computer programs or software to improve business and the quality of service delivery to customers and members of the public.
Traditional method of running bank requires the customers to visit the banking hall personally to transact and verified all issues affecting his or her relationship with the bank. But the reverse is the case with the advent of computer application which makes it easier for banks to write a press release for the masses on the new policy or policy adjustment, sending and receiving money online, checking balance without going to banking etc. It is also observed that computer applications have been a major disease to business development (Miller, 2006). The inversion of virus attack on the application, hacking and stacking, authentication of the transaction and user, network related issues post problems on the importance of complication application in banking institution also, the use of computer application requires additional infrastructure such as power supply and software backup. These increase the chances of problem due to failure of infrastructure, as such; it has been a major problem that needs urgent attention to improve banking operations and quality of service delivery in the society.
1.3 Research Objectives
The main aim of this study is to investigate the impact of computer application on banking institution. Specifically, the study sought to accomplish the following.
i. To investigate the impact of virus attack on computer application in First Bank of Nigeria, Asaba.
ii. To investigate the impact of poor network on computer application in First Bank of Nigeria, Asaba.
iii. To investigate the impact of irregular power supply on computer application in First Bank of Nigeria, Asaba.
iv. To find out the impact of application failure on computer application in First Bank of Nigeria, Asaba.
1.4 Research Questions
It is the researcher’s intention that at the end of this study the following questions should have been adequately answered:
i. What is the impact of virus attack on computer application in First Bank of Nigeria, Asaba.
ii. How does the impact of poor network on computer application in First Bank of Nigeria, Asaba.
iii. Does irregular power supply impact on computer application in First Bank of Nigeria, Asaba.
iv. What is the impact of application failure on computer application in First Bank of Nigeria, Asaba.
1.5 Research Hypotheses
The following null hypotheses would be tested in the course of the investigation.
i. There is no significance impact of virus attack on computer application in First Bank of Nigeria, Asaba.
ii. There is no significance impact of poor network on computer application in First Bank of Nigeria, Asaba.
iii. There is no significance impact of irregular power supply on computer application in First Bank of Nigeria, Asaba.
iv. There is no significance impact of application failure on computer application in First Bank of Nigeria, Asaba.
1.6 Significance of the Study
The study has the following significance:
- It will enlighten corporate organization especially the banks on the importance of computers in enhancing efficiency and overall performance.
- It will enlighten the public on the various forms of computer crimes been perpetuated in Nigerian banks, this will help increase awareness and security consciousness when dealing financial transactions at our banks.
- The study will also reveal mechanisms put in place by the government aimed at tackling computer crimes in Nigeria.
- Banks will find this study useful it will expose them to new form of computer crimes and how best to tackle these menaces.
- This study is also serve as means of discouraging would-be cybercrime perpetuators while also encouraging moral obligations to the society.
- Finally it will add to existing body of knowledge when successfully completed.
1.7 Limitation of the Study
A study of this nature is bound to come across challenges which includes but not limited to:
Insufficient availability of research materials written by our indigenous people pose a constraint in this work as most related materials are the products of foreign writers.
The non-cooperative attitude of some respondents and in completing the questionnaire in time will also pose a problem. The researcher may need to visit some study area more than once before collecting the completed questionnaire.
Finally, being that the study will adopt Expost Facto research design, it is also envisaged that the already existing influence of the independent variables on the dependent variable will be obtained without the researchers control, hence, making it impossible to correct the existing errors that accompanied it.
1.8 Definition of Terms
Banks: The word bank means an institution empowered by law to review deposits cash, cheque, or drafts discount commercial paper, make loans and issue promissory notes payable to the bearer known as bank notes. Banks are usually organized into corporations.
Computer crime: This can be broadly be defined as criminal activity involving an information technology infrastructure: including illegal access or unauthorized access.
Countermeasures: These are strategic steps taken by individual, organization or governments aimed at addressing issues that are that have the potential of leading to loss of lives or properties.
Fraud: this is a deceit trickery or breach of confidence used (by one person) to gain unfair and dishonest advantage (over another).
Financial Statement: this is a document which sets out the financial state of affairs as at a particular date.
Balance Sheet: this is a summary of the assets belonging to a company and the various ways in which these are financed.