Paradigms
A Research Journal of Commerce, Economics, and Social Sciences
Online ISSN: 2410-0854
Print ISSN: 1996-2800
 
     
 

Paradigms Journal

IMPACT OF CASHLESS BANKING ON PROFITABILITY: A CASE STUDY OF BANKING INDUSTRY OF PAKISTAN
Author(s) :
KASHIF MEHMOOD KAMBOH (Department of Management Sciences, Lahore Leads University, Lahore, Pakistan)
MUHAMMAD EHSAN JAVAID LEGHARI (Department of Management Sciences, Lahore Leads University, Lahore, Pakistan)
Abstract
Pakistani banking industry is at transforming stage, making investment in technology to upgrade its infrastructure for implementation of cashless banking in the country. This study examines the impact of cashless banking on profitability of Pakistani banking industry. To measure cashless banking in the country proxies of Automated Teller Machines Transactions (ATMT), Point of Sales Transactions (POST), Call Center Banking Transactions (CCT) and Mobile Banking Transactions (MOBT) are used to examine their impact on aggregate Return on Equity (ROE) of the banking industry. Ordinary Least Square (OLS) multiple regressions are used to obtain the results and data from 2nd quarter of 2007 to 4th quarter of 2014 is used. The results show that POST and MOBT are positively significantly related to ROE, CCT and ATMT are negatively significantly associated with profitability. Recommendations are made that banks should educate their customers to use of internet banking services, because it reduces time cost of both. Call center banking customer’s confidence should be built so they can use this channel without any fear. 
Keywords: Cashless Banking, Point of Sales, Call Center, Mobile Banking, Profitability
 
 

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