Electronic Payment Paradigm and Price Earnings Ratio of Financial Institutions in Nigeria
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Research Parks Publishing LLC
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The collective growth of information and communication technology has conveyed many accomplishments to mortal civilization, influencing the lives of people, behaviours and societal measures. The digital economy, electronic commerce and electronic banking are now being used by the new technologies and the wider global network, especially internet, within and outwardly. The aim of this study is to investigate and analyze empirically the relationship between electronic payment paradigm and price earnings ratio of financial institutions Nigeria. Data on different types of electronic payment paradigm and price earnings ratio from 2007-2018 were collected from central bank of Nigeria statistical bulletin, annual reports of the financial institutions and federal Inland Revenue Service. Descriptive statistics, ordinary least square regression analysis, Jarquo-Bera test, Stationarity test, fixed effect regression, random effect regression, diagnostic test, Lag range multiplier test, panel error correction model, cointegration test and stacked pair-wise Granger Causality test were used for analysis of collected data with the aid of E-view version 10. the empirical indicate that electronic payment paradigm relate significantly to price earnings ratio; explaining about 81.3% of the variation in price earnings ratio, automated teller machine, point of sale were each found to significantly relate to performance of financial institutions in Nigeria. the empirical study conclude that electronic payment paradigm has the potency to make significant contribution to price earnings ratio and recommends that Financial Institutions need to establish more electronic payment facilities for instance banks should install more automated teller machine cards machines to improve the effectiveness of credit cards since it’s the most common payment method preferred by clients. Similarly internet facilities should be extended to both branches and stations. Massive sensitization campaigns to enrich the public about the existing electronic payment methods in financial institution since the public seem not to be aware of electronic payment methods that exist in these financial institutions and how significant they are in business transaction.
Keywords
Price Earnings Ratio, Financial Institutions, Performance, Automated Teller Machine, Point of Sale