THE IMPACT OF FINTECH ON FINANCIAL INSTITUTIONS PERFORMANCE IN NIGERIA.
Abstract
ABSTRACT
This study investigates the impact of fintech companies on the performance of financial institutions in Nigeria, with a focus on key services such as online web payment, Automated Teller Machines (ATMs), and mobile banking. Adopting a quantitative research design, data were collected through structured questionnaires distributed to 50 respondents including bank staff, fintech employees, academic researcher, and end users. Descriptive analysis revealed widespread awareness and daily use of fintech services, particularly mobile banking and online web payments. Respondents generally agreed that fintech has increased competition, improved operational efficiency, and enhanced customer satisfaction in the financial sector.
The discussion of findings showed that only mobile banking demonstrated a statistically significant and positive impact on the performance of financial institutions, while online web payment and ATM technologies, though widely used, did not have a meaningful effect on profitability or operational efficiency. This highlights that different fintech services contribute differently to institutional performance. Key challenges identified include inadequate technological infrastructure, cybersecurity risks, limited trust, and regulatory uncertainties that hinder the full potential of fintech. In conclusion, fintech has emerged as both a disruptive force and a complementary partner to traditional banks, aligning with theoretical frameworks such as the Disruptive Innovation Theory and Innovator’s Solution Theory. The study emphasizes that mobile banking is currently the most impactful fintech service in improving institutional performance in Nigeria. To maximize fintech’s benefits, it is recommended that financial institutions invest more in mobile banking platforms, enhance customer service efficiency, strengthen cybersecurity measures, and form strategic partnerships with fintech firms. Policymakers should create clearer regulatory frameworks, enforce data protection laws, improve technological infrastructure, and facilitate funding opportunities for fintech startups. These measures will help unlock the transformative potential of fintech and ensure sustainable growth in Nigeria’s financial sector.
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