The Impact Of Internet Banking On Commercial Banks Profitability: The Case In Vietnam

Abstract

Internet banking has quickly become one of the most well-known banking methods, with a significant increase in use over the previous several years. There is a lack of empirical studies investigating the influence of internet banking on bank profitability. The purpose of this study is to examine the impact of Vietnamese internet banking of commercial banks on their profitability from 2015 to 2020. The study sample consists of 10 commercial banks in Vietnam. Due to foreign influences that may cause the analysis results to be biased, joint venture banks and foreign bank branches are not included. The study period begins in 2015 to 2020, assuring a suitable number of observations, and capturing more recent data. The current condition of Internet banking in Vietnam and its consequences for the Vietnamese banking industry are examined in this study. Its goal is to assess how Internet banking impacts bank profitability in particular. This study evaluates Internet banking intensity and bank profitability indicators utilizing a mix of primary and secondary data. The study’s objective was to determine the impact of internet banking on commercial banks profitability in Vietnam as measured by Return on Equity, Return on Assets, and Net Interest Margin. This was accomplished using the Statistical Package for Social Sciences (SPSS). This study’s empirical findings are more important for developing nations like Vietnam because they would motivate bank profitability and policy makers to expand Internet banking. Finally, because internet banking is new and continually developing, the results of empirical research Internet banking research might differ greatly depending on the sample size and analysis approach. Multiple regression results, on the other hand, show a modest significant correlation, a bigger significant link, and a negative association with bank risk for Internet banking profitability and offering, implying that internet-based banks are less vulnerable to risks such as nonperforming loans.