ELECTRONIC BANKING CHANNELS AND FINANCIAL PERFORMANCE IN THE NIGERIAN BANKING INDUSTRY

This study investigates the impact of electronic banking channels on the financial performance of the Nigerian banking industry over the period 2000 to 2023. Utilizing robust econometric techniques, including Descriptive Statistics, Augmented Dickey-Fuller (ADF) Unit Root Tests, Bounds Co-integration Test, Autoregressive Distributed Lag (ARDL) estimation, and post-estimation diagnostics, the research captures both short-run and long-run dynamics between Automated Teller Machines (ATM), Internet Banking (IB), Mobile Banking (MB), Point-of-Sale (POS), and performance indicators Return on Assets (ROA) and Financial Deepening Ratio (FDR). Grounded in the Technology Acceptance Model (TAM), the analysis reveals that internet and mobile banking significantly enhance long-term profitability. At the same time, ATM and POS contribute to short-term financial inclusion but impose cost pressures that may suppress returns. FDR positively influences ROA, underscoring the profitability benefits of broader financial participation. Macroeconomic variables, particularly inflation and interest rates, exhibit notable effects on financial deepening, reflecting their role in digital financial engagement. The error correction terms confirm long-run equilibrium relationships in both models. Policy recommendations include aligning profitability and inclusion through digital literacy programs, subsidizing ATM/POS deployment, moderating interest rates, and supporting cost-efficient digital innovations. The study concludes that a dual policy approach that promotes both profitability and financial system participation is vital for fostering a resilient, inclusive, and digitally driven banking sector in Nigeria.