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Digital Payment Adoption and Profitability Spillovers in Nigerian Deposit Money Banks: A Sectoral Analysis

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  • October 4, 2026
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Ojeh Augustine, Ph.D., FCA. 1, Ani, Samuel Uchezuike, Ph.D.2, Ani, Godwin Anaezichukwuolu, Ph.D.3,Festus Ndubuisi Nkwo4

Abstract         

This study examined the effect of digital payment adoption on profitability spillovers in Nigerian Deposit Money Banks between 2013 and 2023. The specific objective was to assess how Electronic Banking Income (EBI), POS Terminals Deployment (POSD), Mobile Banking Transaction Volume (MBTV), ATM Transaction Value (ATMV), and Internet Banking Income (IBI) influence ROA. Using panel data from five leading Nigerian banks and applying panel least squares regression analysis, the study found that none of the examined digital payment variables had a statistically significant effect on ROA. Electronic Banking Income (β = -0.001094, p = 0.2061), POS Terminals Deployment (β = -0.000635, p = 0.1499), Mobile Banking Transaction Volume (β = 6.96E-07, p = 0.8634), ATM Transaction Value (β = 1.42E-06, p = 0.0994), and Internet Banking Income (β = -0.001335, p = 0.3330) all exhibited statistically insignificant relationships with ROA, indicating limited direct impact on bank performance over the study period. Descriptive statistics revealed considerable variability across banks in digital payment adoption levels and ROA, reflecting differences in operational scale, market reach, and strategic execution. The findings suggest that while digital payment adoption is important for operational modernization, other factors such as macroeconomic conditions, regulatory frameworks, management practices, and market competition play a more prominent role in shaping ROA. The study concludes that banks should adopt a holistic strategy that integrates digital payment initiatives with broader performance and risk management measures to improve long-term asset returns.

Keywords:  Return on Assets, Digital Payment Adoption, Electronic Banking Income, POS Terminals, Mobile Banking, ATM Transactions, Internet Banking.Cite: Ojeh, A., Ani, S. U., Ani, G. A.,Nkwo, F. N. (2026). Digital Payment Adoption and Profitability Spillovers in Nigerian Deposit Money Banks: A Sectoral Analysis. International Review of Cooperative Business and Management, 4(3), 150-168. https://doi.org/10.5281/zenodo.23131164    

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