CHALLENGES AND OPPORTUNITIES OF E-BANKING IN ETHIOPIA: THE CASE OF COMMERCIAL BANK OF ETHIOPIA

Abstract

This thesis aims to examine expansion of E-banking in the commercial bank of Ethiopian with respect to the barriers which can influence firm from taking advantage of E-banking system and expected benefits derived by the expansion system. The study was conducted based on the data gathered from bank with in its four branches located at Addis Ababa includes; (Gofa sefer, Arada giorgis ,Addis Ababa and finfine) on E-payment staffs by distribute 160 questionnaire A mixed research approach was used to answer the research questions that emerge through the review of existing literature and the experiences of the researcher in respect of the E-banking system in commercial bank of Ethiopia. The study statistically analyzes data obtained from the survey questionnaire. A research framework developed based on technology-organization-environment framework and Technology acceptance model to guide the study. The result of the study indicated that, the major barriers commercial bank of Ethiopian faces for the expansion of Electronic banking are, security risk, lack of trust, lack of legal and regulatory frame work, Lack of ICT infrastructure and absence of competition between local and entire absence of foreign banks. The study also identified perceived ease of use and perceived usefulness as a driver for expansion of E-banking system. The study suggests a series of measures which could be taken by the bank and by government to address various challenges identified in the thesis. These measures include: Establishing a clear set of legal frame work on the use of technology in banking industry, supporting banking industry by investing on ICT infrastructure and banks needs to be focused on technological innovation competition rather than traditional bases of retail bank competition.