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| Electronic Banking and its Impact on Financial Performance: An Empirical Evidence of Centenary Bank
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Kaziro Nicholas, Irumba Alex
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Abstract:
The proliferation of electronic and digital banking technologies has significantly transformed service delivery in the financial sector globally. However, empirical studies investigating impacts on specific banks in developing country contexts remain limited. This study examined the effect of electronic banking channels on key performance indicators of Centenary Bank in Uganda using time series data from 2007 to 2021. Multiple regression analysis was conducted using SPSS and STATA to analyze relationships while controlling for macroeconomic influences. The findings revealed that increased use of mobile and internet banking significantly raised the bank's profits, deposits and loans portfolio. However, ATM transactions had an insignificant effect. Additionally, GDP growth and inflation positively influenced bank performance. The Pearson correlation coefficient between ATM transactions and financial performance was 0.595, indicating a moderately strong positive correlation between these two variables. This suggested that as the volume of ATM transactions increased, there tends to be a corresponding improvement in financial performance among the entities examined. The conclusions drawn were that electronic delivery platforms enhance Centenary Bank's commercial viability. Recommendations for continued digitization to optimize service provision and competitiveness are provided.
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