Table of content
Background to the Study
of the Study
of Research hypothesis
of the Study
of the Study
of key Terms
of Automated Teller Machine
2.3 Automated Teller
Machine and Risk Management Challenges
Banks and Automated Teller Machine Wind of Change
Imperatives of Automated Teller Machine in Nigeria
Satisfaction through the use of Automated Teller Machine
The Benefit of
Automated Teller Machine to Bank Customers and Banks
militating against Automated Teller machine
and sample site of the Study
3.3 Sources of Data
of Data Collection
of Data Analysis
Presentation, Analysis and Interpretation
4.3 Test of Research Hypothesis
4.4 Interpretation of Finding
4.5 Summary of Finding
Conclusion and Recommendations
5.3 Limitation of the Study
5.5 Suggestions for Further Research
of the Study
Teller Machines (ATM) are devices used by bank customers to process account
transactions. Typically, a user inserts into the ATM a special plastic card
that is encoded with information on a magnetic strip. The strip contains an
identification code that is transmitted to the bank’s central computer by
modem. To prevent unauthorized transactions, a personal identification number
(PIN) must also be used by the user using a keypad. The computer then permits
the ATM to complete the transaction; most machines can dispense cash, accept
deposits, transfer funds, and provide information on account balances. Banks
have formed cooperative, nationwide networks so that a customer of one bank can
use an ATM of another for cash access, by extension all commercial bank’s ATM
in Nigeria are inter-connected (Okoh, 2010).
Automated Teller Machines (ATMs) have been adopted and are still being adopted
by banks. They offer considerable benefits to both banks and their depositors.
The machines can enable depositors to withdraw cash at more convenient times
and places than during banking hours at branches. In addition, by automating
services that were previously completed manually, ATMs reduce the costs of
servicing some depositors of demand. These potential benefits are multiplied
when banks share their ATMs, allowing depositor of other banks access their
account through a bank’s ATM (Andrews, 2003).
have become the principal deployers of ATMs. Two reason for this are that they
want to increase their market share, although due to the prevalence of ATMs, it
is not likely to be the primary means by which ATMs increase profitability for
most banks, or/and above a certain level of operations, the cost of a single
transaction performed at an ATM is potentially less than the cost of a
transaction conducted from a teller, as ATMs are capable of handling more
transactions per unit of time than are tellers (Laderman, 1990).
Nigeria the deployment of ATM by banks and its use by bank customers is just
gaining ground and has burgeoned in recent times. This has happened especially
after the recent consolidation of banks, which has in all probability, made it
possible for more banks to afford to deploy ATMS or at least become part of
shared networks (Fasan, 2007). The increased deployment of ATMs in the banking
sector has made the issue of technology relevance important. ATM services have a history that is less than
ten years in Nigeria. At first, they were operated as elitist services designed
for those desirous of exclusive services. Cards were rare and the process for
obtaining them tortuous.
the use of ATM cards has been widely promoted. Banks no longer appear to want
personal contact with their customers. Some banks have resorted to penalizing
the customer as it were, for not possessing an ATM card, by debiting the
account of such a customer for withdrawing below a certain amount across the
counters. Agboola (2006) reported that although only a bank had an ATM in 1998, by
2004, fourteen of them had acquired the technology.
(2006), discovered that the adoption of ICT in banks has produced largely
positive outcomes such as improved customer services, more accurate records,
ensuring convenience in business time, prompt and fair attention, and faster
services etc. Also, the banks’ image is improved creating a more competent
market. Work has also been made easier, and more interesting, the competitive
edge of banks, relationship with customers, and the solution of basic operational
and planning problem has been improved. Fananopo (2006) stated that Nigeria’s
debit card transaction rose by 93 percent over pervious years owing to
aggressive roll out initiatives by Nigerian banks, powered by interswitch
network the number of ATM transactions through interswitch network had
increased from, 1,065,972 in 2004, to 21,448,615 between January 2005 to March
is a rise of 92.6 percent with respect to the pervious years. More than 1700
ATMs have been deployed on the network, while about 12 million cards have been
issued by 18 banks as at March 2012.
recent survey conducted by Intermarc Consulting Limited revealed that ATM
services provided by Nigeria by banks and non-financial institutions stood as
the most popular e-business platforms in Nigeria (Intermarc Consulting Limited,
2007). The report showed that awareness for various banking services rendered by
Nigerian banks is mostly limited to the traditional banking services. The
findings shows that 99% of the respondents were aware of savings account, while
92 where aware of current accounts and 72 percent are aware of local money
transfer services. However, among the more modern banking services such as
electronic banking, internet banking, point of sales (POS) transactions, money
transfer, ATMS emerged as the most popular with 96 percent awareness level ATM
awareness also ranked higher than awareness level about current accounts and
slightly below savings account (Omankhanlen, 2007).
Hence, there is
clearly a need to study the impact of automated teller machine (ATM) on bank
customer satisfaction. It is against this background that the research sees the
subject-matter worthy of investigation.
1.2 Statement of Problem
times in Nigeria, customers of banks are no longer only concerned about safety
of their funds and increase return on investments but demand efficient, fast
and convenient services. Customers want a bank that will offer them services
that will meet their particular needs and support their business goals at any
given time, even after working hours. All these are only achievable through the
use of ATMs.
of this laudable impact of ATMs to bank customers, a lot of them do not
subscribe to it’s use, owing to several complaints from some ATM users who
complain about problems arising from fraudulent activities of ATM fraudsters
and normal challenges, such as telecommunication break down, age which makes
most ATM machines in Nigeria to run on generators, UPS and inverters. As such
doubt is expressed about the impact of Automated Teller Machines (ATM) on bank
customer satisfactions. It is against this,the the researcher focused the impact of ATM, on customers
satisfaction in UBA plc magadishu Branch Kaduna.
1.3 Objective of the Study
objective of the study is to examine the impact of Automated Teller Machine on
bank customer’s satisfaction. Other specific objective include to:-
Investigate how Automated Teller Machine
enhances customer’s satisfaction in United Bank of Africa.
Examine the benefits a customer derives from
using Automated Teller Machine (ATM) in United Bank for Africa.
Identify the challenges militating against ATM
operation in United Bank for Africa.
the study the research question below is proferred with answers;
1. How does ATM
enhance customer’s satisfaction in United Bank of Africa?
benefits do customers derive from using Automated Teller Machine (ATM) in
United Bank of Africa?
3. What are the
challenges militating against ATM operation in United Bank for Africa?
1.5 Statement of hypothesis
The stated hypotheses tested
in this study;
teller machine does not enhance bank customer satisfaction.
teller machine enhances bank customer satisfaction.
1.6 Significance of the Study
study would enable banks executives and indeed the policy makers of the banks
and financial institutions to be aware of Automated teller Machine as a major product
of electronic commerce in Nigeria with a view to making strategic decisions.
The research is equally significant because it would provide answers to factors
militating against the operation of Automated Teller Machine (ATM) in United
Bank for Africa this work would also be useful to student, scholars and
researchers who may wish to undertake a similar study as they will use it as
springboard to their own work.
1.7 Scope of the Study
pursuance of the objective of the study, attention shall be focused on
Automated Teller Machine (ATM) among other electronic banking implementation.
In order to conduct an empirical investigation into the impact of Automated
Teller Machine (ATM) on Bank customer satisfaction in United Bank of Africa and
will also examine the nature of Automated Teller Machine operation in United
Bank for Africa from 2007 to 2011.
1.8 Definition of Terms
The Key terms below
are used in this study
ATM Card:- Debit
card use by banks customer in making transactions via ATM. The card is a
complex circuit that process microprocessors with single chips that contain the
complex Arithmetic and logic unit of computers. It provides access to customers
to perform balance inquiry, mini statement and cash withdrawal as well as
transfers through the use of Automated teller Machines. This Debit card can
also be used for internet online and POS transactions.
Chip card:- This
is a card containing one or more computer chips or integrated circuits for
identification, data storage or special purpose processing used to validate
personal identification numbers, authorize purchases, verify account balances
and store personal records.
Electronic Data Interchange (EDI): The transfer of information between
organization machines readable form.
Monetary value measured in currency units stored in electronic form on
electronic device in the consumer’s possession. This electronic value can be
purchase and held on the device until reduced through purchase or transfer.
Mobile Banking:- This
is a product that enables the bank to offer customers to access services
anywhere. Customer can make their transactions anywhere such as account
balance, transaction enquires, stop checks, and other customers services
instructions balance inquiry, account verification, bill payment, electronic
fund transfer, account balances, updates and history, customer service via
mobile, transfer between account etc.
business receiving money from outside as deposit for safe keeping and making
payment accrued which the money is due for payment and also advancing loans to
those who keeps money for safe keeping as well as the public at large.
a period during which transactions takes at the end and in which settlement
must be made
refers to group of persons who receive money from individuals for safe keeping
in the agreement that he will refund the said amount collected either on demand
or at some certain date agreed upon.
is an order written by the owner to the banker to pay on demand to the bearer
of the cheque.
Cheque: A cheque, which the bank refused to attend to for one
reason or the other e.g irregular signature, post dated cheque etc.
amount of money that is lend out and that must be repaid within an agreed rate
of interest usually for specific period of time.
Book: It supplied to the customer by the bank in which all
entries are made of all deposits and withdrawals that are made.
Cheque: These are cheque drawn by the drawer but not yet presented
for payment by the bearer.
usually created on a current account unlike a loan account where only
periodical payments are made. An
overdraw account is a running account where drawing and deposits are made. An overdraft account is a running account
where drawing and deposits are made. In
an overdraft account as frequently as may be needed or received in connection
with the business to meet the account related.
Payment System – A
financial system that establishes that means for transferring money between
suppliers and of fund, usually by exchanging debits or Credits between
Point Of Sale (POS) Machine - A
Point-of-Sale machine is the payment device that allows credit/debit
cardholders make payments at sales/purchase outlets. It allowed customers to
perform the following services Retail Payments, Cashless Payments, Cash Back
Balance Inquiry, Airtime Vending, Loyalty Redemption, Printing ministatement
Smart Card – A
Card with a computer chip embedded, on which financial health, educational, and
security information can be stored and processed.
Transaction Alert -
Our customers carry out debit/credit transactions on their accounts and the
need to keep track of these transactions prompted the creation of the alert
system by the Bank to notify customers of those transactions. The alert system
also serves as notification system to reach out to customers when necessary
information need to be communicated.
Western Union Money Transfer
(WUMT) - Western union Money transfer is a product that allowed
people with relatives in Diaspora who may be remitting money home for family
up-keep, Project financing, School fees etc. Nigerian Communities known for having
their siblings gainfully employed in other parts of the world are idle markets
for Information and communication technology.
for Automated Teller Machine
for management information system
banking through internet and computer network