DETERMINANTS OF BANK CUSTOMERS' PATRONAGE OF POINT OF SALE (POS) SERVICES IN EKWULOBIA, ANAMBRA STATE

DETERMINANTS OF BANK CUSTOMERS' PATRONAGE OF POINT OF SALE (POS) SERVICES IN EKWULOBIA, ANAMBRA STATE

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BACKGROUND OF THE STUDY

On the convergence curve of information and communication technology, the world's financial institutions and telecommunication firms are about to enter a new cycle. A novel and potential application of the e-payment system for the next generation is the point of sale (POS) terminal. Monetary authorities in every system have been keeping a close eye on the function and relevance of efficient payment systems and have been working to promote their adoption. Because it is based on cash transactions, the Nigerian payment system cannot and has not been able to provide an efficient and effective payment platform, which is necessary for the country's continued economic development (Adeoti 2013).

Because of the growing prevalence of the usage of modern electronic technologies for the transfer of e-funds throughout the world, the incorporation of POS into the economy of Nigeria has made it much simpler to do business without having to carry about large amounts of cash at all times.

The Central Bank of Nigeria (CBN) implemented the usage of point-of-payment (POS) terminals as a method of making financial payments in Nigeria in 2012 as part of an effort to promote its cashless policy and with the intention of enhancing the payment system. Since its inception, the number of active point-of-sale (POS) terminals that banks make available to businesses that deal in mobile money has been steadily expanding over time. For instance, during the first three months of 2018, it was reported that a total of 17,193 POS terminals were registered by banks in Nigeria for the purpose of carrying out cashless transactions (Ogunfuwa, 2018). According to data collected by the Nigeria Inter-Bank Settlement Scheme (NIBSS), there were 164,607 operational POS terminals in Nigeria as of the end of the year 2018. Also, in addition to this development, a record-breaking increase of 66.6% was registered in the number of transactions using POS across the country as of January 2018, compared to the value reported using POS for transaction in January of 2017. This trend continued in February of 2018, which resulted in a rise of 60.61% when compared to February of 2017. The use of POS terminals as a method of payment and the growing penetration of ICT networks in Nigeria are two factors that may be credited with contributing to this rise.

A device that enables local debit cards to make withdrawals from their accounts or make payments for goods and services can be referred to as a point of sale terminal or a point of purchase terminal. Retail transactions are often handled through the use of a point of sale or service (POS) terminal. Depending on the model, it can provide a wide variety of services, such as the processing of credit cards, the reading of checks, and transactions. These gadgets are available pretty much everywhere, from supermarkets to service stations and everywhere in between. The point-of-sale (POS) machine utilizes technology that makes for a transaction that is both quick and safe.

This machine is often seen at retail establishments, where consumers may use their debit or ATM cards to pay for goods or services. A POS machine may also be used to pay some bills, such as those for power, airtime, cable or decoder subscriptions, and so on.

However, not everyone in Nigeria has access to the services offered by banks, particularly residents in rural areas. This is especially true for people living in isolated villages. Banks developed the point-of-sale (POS) industry as a terminal in order to deliver financial services to a greater number of people in the under banked and unbanked segments of the population. Because of this, it is a huge relief to decongest the already crowded banks in the rural and urban areas, as well as the crowds that are frequently seen at ATM locations. Furthermore, it is an encouragement to entrepreneurs who would be interested in being bank agents while earning their own commission.

1.2 Statement Of The Problem

A Point of Sale, or POS, terminal is a device that gives clients of banks access to their bank accounts so that they may make purchases of products and services in various commercial areas that accept this particular way of payment. The implication of this is that consumers are able to make payments for products and services without essentially coming into contact with physical cash. This is because the purchase price would be directly deducted from the buyer's bank account and credited on the seller's account upon the successful completion of the purchase transaction (Olanipekun et al, 2013). This machine eliminates the need for clients to carry cash and the risk of theft, while also greatly reducing the costs associated with cash administration and handling for financial institutions as well as other types of company owners. In addition, point-of-sale terminals accept not only credit and debit cards issued within the country but also prepaid debit and credit cards issued outside of the country. This presents Ethiopian retailers with a fantastic chance to expand their sources of income by catering to a wider variety of clients, regardless of whether they are paying for their purchases with cash or payment cards. Addis Fortune (2015). In addition, having a point-of-sale (POS) machine not only gives cardholders and merchants more options for how they can make a payment, but it also helps reduce the amount of manual work that is required to attend to customers' needs and frees up service providers to concentrate on more important tasks than simply handling their cash flow. A further substantial advantage is that it lends an air of contemporary sophistication to the business that is providing the service.

Despite the fact that point-of-sale (POS) services have resulted in a number of positive outcomes for all parties engaged in the operation of the business, this does not mean that they are devoid of any negative aspects. It has encountered problems such as a poorly developed telecommunication infrastructure, a security challenge as they highly depend on critical ICT systems, an inability to access and effect the transfer of funds due to technical imperfections on its own side, and resistance to changes in technology among customers and staffs due to a lack of awareness on the benefits of new technologies (Nchekwube 2019).

Providing more desirable and better services to customers, as well as the development of e-banking services, was found to be unquestionably indispensable, and this has led to an increased number of ATM and points of sales (POS) services being provided by banks to the public across the globe. This is all due to the development of various electronic banking channels, the operational alteration of the way banks do business, as well as the change in customers' needs. Unfortunately, it seems that appropriate and adequate awareness creation and culture have not been made for different groups of people and societies to utilize electronic payment channels properly and equally with the development and adoption of electronic banking infrastructures. This seems to be the case most frequently in developing countries. Because of this, there is a significant gap in reaching the market with solutions of this kind and positioning electronic items in the minds of customers; point-of-sale (POS) services are not an exception to this. Javadin(2008).

1.3 Objectives Of The Study

Research objectives are just as useful as they are in most other aspects of life. According to Torty (2021), "Research objectives provide the researcher with a wonderful feeling of aim and direction." Hence, the purpose of the study is to examine the determinants of bank customers' patronage of point of sale (POS) services in ekwulobia, anambra state. The specific objectives include;

1. Find out whether bank customers patronizes POS due to its speed and effectiveness.
2. Determine whether bank customers patronizes POS due to its reliability.
3. Ascertain whether bank customers patronizes POS due to its responsiveness.
4. Determine whether bank customers patronizes POS due to its security.

1.4 Research Questions

Research questions provide structure and direction for a study in scientific inquiry. As a result, according to Torty (2021), "research questions should truly constitute an enlargement of the research problem."

The following research questions were posed in accordance with the study's objectives:

1. Do bank customers patronize POS due to its speed and effectiveness?
2. Do bank customers patronize POS due to its reliability?
3. Do bank customers patronize POS due to its responsiveness?
4. Do bank customers patronize POS due to its security?

1.5. Research Hypothesis

H0: the extent to which bank customers patronize POS services is not high.

Ha: the extent to which bank customers patronize POS services is high.

1.6 Significance of the Study

The findings of this study will contribute greatly to the benefit of CBN, other private banks engaged in conducting such business, to the researchers who will be studying POS related topics in the future as well. Moreover, applying the recommendation from the results of the study will enable CBN, other private banks and stakeholders to identify the critical area where the service improvement is required concerning the provision of POS services. To the researcher, making such a research will expose to the field of area and add to the stock of knowledge he or she already has. Besides, the researcher will also gain a great experience on how a research is conducted. To other researchers, who will attempt to study in a related area, this research work will help them as being a stepping stone for their research work. Additionally the result of the study contributes immensely to the body of academic knowledge with regards to the determinants of bank customers' patronage of point of sale (POS) services in Ekwulobia, Anambra State.

1.7 Scope Of The Study

Generally, this study is channeled towards the determinants of bank customers' patronage of point of sale (POS) services in Ekwulobia, Anambra State. The study however will specifically find out whether bank customers patronizes POS due to its speed and effectiveness,determine whether bank customers patronizes POS due to its reliability,ascertain whether bank customers patronizes POS due to its responsiveness, and  determine whether bank customers patronizes POS due to its security.Thus, respondents for this study will be obtained from bank customers in Ekwulobia, Anambra State. 

1.8. Limitations Of The Study

In the course of carrying out this study, the researcher experienced some constraints, which included time constraints, financial constraints, language barriers, and the attitude of the respondents.

In addition, there was the element of researcher bias. Here, the researcher possessed some biases that may have been reflected in the way the data was collected, the type of people interviewed or sampled, and how the data gathered was interpreted thereafter. The potential for all this to influence the findings and conclusions could not be downplayed. 

More so, the findings of this study are limited to the sample population in the study area, hence they may not be suitable for use in comparison to other schools, local governments, states, and other countries in the world.

1.9 Definition Of Terms

POS: Point of Sale (POS) terminal- is a device that provides customers of banks with access to financial transactions in public places.

Reliability: measures the bank’s consistency of performance and dependability. Meaning the firm performs the service right the first time and honors its promises.

Service: is defined as activity or benefit that one party can offer to another that is essentially intangible and does not result in the ownership of anything.

1.10 ORGANIZATION OF THE STUDIES

The study is categorized into five chapters. The first chapter presents the background of the study, statement of the problem, objective of the study, research questions and hypothesis, the significance of the study, scope/limitations of the study, and definition of terms. The chapter two covers the  review of literature with emphasis on conceptual framework, theoretical framework, and empirical review. Likewise, the chapter three which is the research methodology, specifically covers the research design, population of the study,  sample size determination,  sample size, and selection technique and procedure, research instrument and administration, method of data collection, method of data analysis, validity and reliability of the study, and ethical consideration. The second to last chapter being the chapter four presents the data presentation and analysis, while the last chapter(chapter five) contains the summary, conclusion and recommendation.

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