Abstract:
Online Banking in Nigeria has evolved over the years to become one of the most crucial requirements for rendering nation-wide services to banks' customers. The increasing need for customers to carry out their banking transactions from any branch irrespective of where their accounts are domiciled have always been considered the major reason for online banking. However, with increasing globalisation, competition and regulatory requirements, coupled with the need. to increase efficiency and reduce cost of operation, the use of online banking is fast becoming an absolute necessity rather than luxury. The main purpose of the study is to investigate the problems encountered by banks operating online banking system in Nigeria within the years 1996 and 2000. The study also attempted to determine the prospects of online banking in Nigeria amidst the numerous problems. The exploratory research methodology was used for this study because of the investigative nature of the study. The researcher relied mainly on interviews, documentary evidences and personal observations in gathering his data. An analysis of the data collected 'showed that the highest cost component in setting up an online banking system is Computer Hardware 'with 40% of the total cost component. While skilled manpower topped the list of annual running cost with 34% The research was concluded on the premise that t here is a very high prospect for online banking in Nigeria. The study also went ahead to recommend further study on the current operations of online banking, its geographical spread and current cost implications.
