DIGITAL BANKING ADOPTION AND FINANCIAL PERFORMANCE OF LISTED DEPOSIT MONEY BANKS IN NIGERIA

Abstract

The study examined the Impact of Digital Banking Adoption and Financial Performance of Listed Deposit Money Banks in Nigeria. The research is a quantitative research and it utilized ex-post facto research design, and innovation diffusion theory was utilized to guide the study. The data were sourced from audited financial statements and investor presentation of deposit money banks in Nigeria listed on Nigerian Exchange Group (NGX) as at 18^th October, 2024, the population of the study comprises 10 listed DMBs and 6 of them were selected as sample of the study that have available data spanning from 2019 to 2023. The data were analyzed using Multiple Regression Model (MRM). The study revealed that the coefficient for CSI is -0.541, is signifying that a unit increase in customer satisfaction lead to 0.541decrease in NPM, which contradict finding the of Okereke & Ogechukwu, (2024), though their study was limited to examining only the Complaint Resolution Rate, there as this study expands its scope beyond that. However, the results also reveal that the unit increase in RCM will increase the profitability of the DMBs in Nigeria although this relationship is not statistically significant (p = 0.412). The coefficient for RCM is 0.977, indicating a positive effect on NPM, however, this result is not significant with (p = 0.228). Both independent variables have high tolerance values (0.898), indicating no multicollinearity issues. Therefore, the study concludes that neither CSI nor RCM are strong predictors of NPM based on outcome the findings. The study recommends that DMBs should enhance operational efficiencies and explore alternative strategies to improve profitability, as customer satisfaction and regulatory compliance alone do not significantly predict financial performance.