THE RELEVANCE OF INFORMATION TECHNOLOGY IN THE BANKING INDUSTRY

CHAPTER ONE

INTRODUCTION

1.1       Background of the Study

The world is today linked together as a global village with the advent of computer, which had enhanced the easy transaction on business activities scientifically through the electronic machines. The fact is obvious that information technology has revolutionized the business world in which the banking industries has grossly benefited. Since the evolution of Information Technology, the banking sector had tremendously been revamped and sail aged from the syndrome of annual loss in profit, which is now a watershed in the history of banking industries.

Information Technology is the scientific processing and refining raw facts (data with the aid of electronic device) these processed and refined raw data are used by the information technologist for divers purposes e.g. economic, financial, transaction, administrative and managerial functions of planning, organizing, staffing, budgeting, coordinating and controlling. Computes are the majors fulcrum on which information technology as pivoted.

Computers are made use of in the process of exchanging idea and facts. The electronic machines are used in processing data, storing, calculating, reproducing, sorting, classification, summarizing and conveying of data or message from one geographical location to another. At times, the geographical location are several kilometers apart. By having the capacity of conveying information to distance places, computer further serves as big relief to business and a provider of timely information for the financial and managerial decision.

The banking sectors were one of the first to harness the gains of information technology. Due to the performance of the banking industry and its ever growing number with new branches springing up here and there. The effect of information technology on the banking industry also grows geometrically, in fact, no bank work its name and services can afford to be left behind in the information technology world. The yardstick for determining the sophistication or otherwise of banks now lies in their ability to (or not to) provide service aided by information technology.       

Information Technology is the study or use of electronic processes for gathering and storing information and making it available by using computers. It constitutes a vital role in banking system. Information Technology helps to make work faster through the use of computers, it also reduce and correct the errors being made by the workers. 

Over the years, many innovations have taken place in the world. The most striking and most celebrated is the aspect of information technology. Organisations today are confronted with rapidly changing market condition indicated by high merger rate and strong competitors. Under these conditions, traditional management approaches that focus on financial figures and on centralised, analytical planning methods are considered to be insufficient for effectively steering the organisation in a dynamic environment. Hoffman (2002). Recent management support approaches like balanced score card is aimed at providing a broader view of organisational performance.

            The role of technology in the “information age” is well recognised by banks, businesses, industries, governments and as such has completely woven in to their organisational structure and strategic planning process. Previous research work shows that information technology has become the nervous system of banks today and as such Nigerian banks which do not have the means to deliver banking service online and real-time across all branches within the country and abroad will be termed uncompetitive.