WSEAS Transactions on Business and Economics
Print ISSN: 1109-9526, E-ISSN: 2224-2899
Volume 20, 2023
The Impact of Virtual Banking Services Cost on Profitability: Applied Study on Jordanian Commercial Banks
Authors: , , ,
Abstract: This research aimed to investigate the virtual services effective provided by the Jordanian commercial on banks’ profitability; particularly banks listed at Amman Stock Exchange (ASE). This study adopted an explanatory research design depending on the secondary method of data collection via financial report analysis, panel, and quantitative approach was used. The data were analyzed using descriptive and multiple linear regression used to provide an answer to the research questions. All commercial banks listed at Amman Stock Exchange were included in the research sample and the study time period covers the years from 2010-2019. Specifically, the study used Net Profit Margin (NPM) and Tobin’s Q to measure profitability, ATMs, Smart Cards, and Mobile & Internet Banking Services to measure virtual bank services. Moreover, control variables were considered including liquidity and financial leverage. The study findings supported a statistically positive relationship between the two variables, indicating that using virtual banking tools leads to an increase in bank profitability. The study recommends that banks need focus on the disclosure of transparent and clear information concerning the cost of virtual banking services and promote such services among the main sector’s actors. This research contributes to the body’s knowledge in two methods. First, the profitability of banks was examined using virtual banking activities, and second, it was found that ATMs, Smart Cards, and Mobile & Internet Banking Services affect banks’ profitability measured by NPM and Tobin’s Q. Thus, financial technology innovation could encourage the profitability of the Jordanian Commercial Banks.
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Keywords: Virtual Banking Services, profitability, ATMs, Smart Cards, Mobile Banking, Internet Banking
Pages: 1289-1297
DOI: 10.37394/23207.2023.20.115