EFFECT OF ELECTRONIC-BANKING TRANSACTIONS ON LIQUIDITY OF THE NIGERIAN BANKING INDUSTRY

The study examines the effect of electronic banking on the liquidity of banks in Nigeria using time series data of 2012 to 2021 which is gotten from the Central Bank of Nigeria’s statistical bulletin. The study relied on the Ex-post facto research design. The Ordinary Least Square regression is used to test the hypotheses stated in the study. From the study findings, it is revealed that, automated teller machine transaction has a positive relationship and significant effect on liquidity ratio of banks in Nigeria. Furthermore, it is found that, point of sales transaction has a negative relationship and an insignificant effect on liquidity ratio of banks in Nigeria. Lastly, the study result revealed that, web transactions has a negative relationship and insignificant effect on liquidity ratio of banks in Nigeria. Thus, the study recommends that, the CBN and banks in Nigeria should ensure that regulations are made to sustain liquidity ratio of the banks and to ensure an effective and efficient ATM operation; where bank customers can continuously make financial transactions without hitches. This will further entrench e-banking practice in Nigeria which will help the banks cut cost of operations. Also, more enlightenment should be done by the banks about POS and Web transactions to enable customers patronize alternative transaction channels as this will further improve the effectiveness and efficiency of the banks.