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Abstract
The paper examines the practices, opportunities and challenges of E-banking services in Ethiopia. Ethiopian banking system is one of the most underdeveloped compared to the rest of the world. In Ethiopia cash is still the most dominant medium of exchange and electronic-banking is not well known, let alone used for transacting banking business. All banks in Ethiopia except Dashen Bank are too late to move with technological advancement and they should clearly chart out the time schedule for their integration and technological advancement.
Keywords: E-banking, Challenges of e-banking in Ethiopia
INTRODUCTION
Information technology is considered as the key driver for the changes taking place around the world. Due to a pervasive and steadily growth of information and communication technology, the world banking industry is entering into new phenomena of unprecedented form of competition supported by modern information and communication infrastructure. E-commerce has become a buzzword for companies over a couple of years with increased awareness about the use of computers and internet. The Internet is the driving force for the growth of e-commerce.
The information and communication applications are paramount concern to the banks in today's business environment and Internet has become the major platform for all financial, banking and commercial transactions in the present scenario. Statistics show that Africa is lagging behind in the adoption of E-commerce. However, according to Jensen (2003), there is some e-commerce activity in Africa, with South Africa, Egypt, Morocco, and Tunisia taking the lead. Most rural areas in Africa, where the majority of small and medium businesses are concentrated, have no Internet facilities and thus are unable to engage in e-commerce activities. According to Jensen (2003), most countries in Africa, except South Africa, have Internet infrastructure only in their major cities."
The slow diffusion of e-commerce has been attributed to a number of issues some of which may be unique to the African continent. Recently, several African countries have already made progress in their e-commerce links to integrate them selves with the global connectivity roadmap (Magembe, B A S and Shemi A P (2002).
Existing trading relationships and service provision within the financial sector are undergoing rapid change with the development of new financial soft ware applications. The rapidly growing information and communication technology is knocking the...