An Assessment of Barriers to Effective Digital Banking Service Delivery in Nigerian Commercial Banks: Customers Perspective

Abstract

This study aims to examine the barriers that hinder effective digital banking service delivery in Nigerian commercial banks from the customers’ perspective, focusing on their influence on perceived usefulness and ease of use. A quantitative survey design was employed, targeting 400 active users of mobile applications, internet banking, USSD, and POS services, with 395 valid responses analyzed using SPSS and SmartPLS. The study adopted the Technology Acceptance Model (TAM) as its framework, with barriers conceptualized across five dimensions: reliability, security, cost, infrastructure, and support. Descriptive results revealed widespread challenges, including frequent transaction failures, poor network connectivity, high charges, fraud risks, and delayed redress mechanisms, despite customers acknowledging digital banking as convenient and efficient. Structural Equation Modeling showed that customer-perceived barriers significantly and negatively affect both perceived usefulness (β = –0.52, P < .001) and perceived ease of use (β = –0.59, P < .001), with large effect sizes and meaningful predictive relevance. The findings highlight that while customers appreciate the potential of digital banking, persistent infrastructural, financial, and trust-related obstacles undermine their experience. The study concludes that improving service reliability, reducing transaction costs, enhancing security frameworks, and strengthening customer support are essential to fostering trust, satisfaction, and sustainable digital financial inclusion in Nigeria.