INTRODUCTION

1.1                        BACKGROUND OF THE STUDY

The advent of financial innovation such as credit cards, smarts cards, electronic transfers in the payment system and more recently, the linking of the Internet banking have transformed the world into a global village linked with electronic impulses.  The concept of electronic money was introduced in 1996 when the Central Bank of Nigeria gave approval to All States Trust bank Limited to offer a financial product known as the ESCA, SMART CARD, an electronic purse.

Subsequently, diamond bank limited introduced a parallel product known as diamond pay card. However, the smart card scheme received a boast in February 1998, when a consortium of 19 licensed banks allocated a smart card company, smart card Nigeria Plc with a mandate to produce a manage cards issued by the member banks of the consortium. Another consortium of more than 20 banks under the auspices of gem card scheme in year the 2000.

These innovations, which are still at a relatively early stage of development have the potential to challenge the predominant role of cash for making small value payments and makes retail transactions easier and cheaper for consumer and merchants, who are current account holders. However, they also raise a number of policy issues because of the possible implication for central bank monetary policy, consumer system.

In response to information technology development in the domestic financial sector, the central bank of Nigeria commissioned an information technology strategy study in 1991 with the objective of promoting the efficient performance of its statutory duties. The project is being implemented in phases and both the licensed banks and the regulatory authorities demonstrated the appreciation of benefits derivable from use of information technology.

In view of foregoing, the central bank governors of the group of ten (G-10) countries commissioned a series of studied on specific issues related to electronic money in November 1995.

1.2                        STATEMENT OF THE PROBLEM

This research work is to address itself on the task to determine the impact of electronic banking in Nigeria.

(a)     In this era of expanded information technology activities around Nigeria electronic banking is more than ever needed.

(b)     Inadequate information technology awareness

(c)      Show-paced information and communications technology growth in Nigeria due to inadequate finding by government and its agencies.

(d)     Inactive regulatory bodies to provide needed logistics and technical support.

(e)      Lack of sufficient skilled manpower.