Title: The effect of digital delivery channels on the financial performance of banks

Authors: Johnson Worlanyo Ahiadorme

Addresses: IGS Financial Services Limited, Corporate Office No. C788/3, 5th Crescent, Anyemi Kpakpa Road, Asylum Down, Accra, 00233, Ghana

Abstract: Digitisation has penetrated every sphere of life and the adoption of digital technologies in the delivery of banking services has reached substantial heights. This study employs a multiple linear regression model to examine the influences of digital delivery channels on the profit performance and cost efficiency of banks. The study finds that most of the digital applications are introduced and used concurrently. The findings of this study show that both automated teller machines (ATM) and internet banking applications improve the income performance and the cost efficiency of banks. However, mobile banking applications have decreasing effects on banks' cost efficiency and income performance. The results suggest that while digital innovations may exert significant positive influence on bank performance, there may be cost implications for the banks. It is crucial that banks while adopting digital innovations, should also engage in a reduction of the proportion of overdue and underperforming assets.

Keywords: digital delivery channels; commercial banks; digital innovations; financial performance.

DOI: 10.1504/IJFIB.2018.092419

International Journal of Financial Innovation in Banking, 2018 Vol.2 No.1, pp.48 - 59

Received: 10 Apr 2017
Accepted: 21 Dec 2017
Published online: 18 Jun 2018 *