Automated Teller Machine And Electronic Payment System In Nigeria: A Synenthesis Of The Critical Success Factors

ABSTRACT This study investigates the effects of ATM infrastructure on the success of e-payment. The study is motivated by the apparent low level of satisfaction with the level of the e-payment services irrespective of the increased deployment of ATM by banks and the need to isolate the critical factors responsible for this. In carrying out the study, banks that are on the interswitch network formed the population. The analysis is based principally on primary data collected from users of the ATMs. A total of one thousand, one hundred and forty-one users of ATM were sampled. Weighted scores of their responses to success factors identified in the literature were analysed using the Factor analysis simulation model. Five strategic decision clusters were modeled, in which inadequate availability of quality infrastructure was identified as the most critical limition to efficient e-payment system via ATMs. The conclusion therefore is that provision of adequate infrastructure such as power is critical for effective integration of the Nigerian banking system to the global network of electronic payment via ATMs, however for this to be possible, concerted effort must be made by stakeholders to resolve the lingering crisis in the energy sector.
Key words: e-payment, ATM, infrastructure, eigenvalue, principal component, varmax rotation.

INTRODUCTION The purpose of banking is to enrich society through the provision of infrastructure for savings, investments and settlement/payment of exchanges. A more pragmatic definition of purpose of banking would be to meet society’s need for efficient payment system (reliability at minimum cost). The responsibility of bank management is to establish priorities and objectives as well as monitor performance in the desired direction.
Banks in the advanced countries have over the years developed roadmaps to quality financial services delivery. They have identified application of ICT as strategic to achieving global competitive advantages (reduced operational costs, improve service quality, increased market, shorten service cycle time, increased capacity to respond to changing environmental and socioeconomic y drivers of profitability) (Aral et al., 2006).
The banks operating in Nigeria have of recent joined the trend but this is not without some problems. This range from resistant from employees who tend to believe that ICT application may lead to job loss to the near lack of socioeconomic, technological and legal infrastructure needed to support the policy. Global competition according to Kouvelis, et al. (2006) has created need for transformation of modern organizations from multi-layered, hierarchical, fat ones to networked, flat, thin ones. These are aimed at helping organizations to face adverse environmental conditions such as economic recession, global competition and deregulation. In the process of making these transformations, organizations tend to have identified ICT application as a necessary requirement (Bardhan, 2007). The above misgivings may have slowed the pace at which the Nigerian banking industry responded to the need for ICT application to their operations.
However, there have been near lack of empirical research efforts geared towards assessing the successes attain in ICT application by banks in Nigeria. With the successful consolidation of banks in Nigeria, the industry is pursed to operate at global best practices. Hence ICT facilities especially the ATM are massively being deployed at remote stations by banks. It therefore follows that the need to investigate the critical success factor of this policy on the overall realization of the objective of banking in Nigeria is timely, hence the need for this study.

OBJECTIVE OF THE PAPER The central objective of this paper is to investigate the extent to which the policy to expand geographical coverage through ATM deployment has helped banks to enhance their efficiency in e-payments. The specific objectives therefore include:

• Identification of decision factors for successful deployment of ATMs by banks; 
  
• To assess the extent to which deployment of ATMs by banks has affected e-payment system.