E- PAYMENT RISK AND CONTROL TECHNIQUES IN THE BANKING SECTOR OF CAMEROON

CHAPTER ONE

INTRODUCTION

1.1 Background of the Study

In the digital era, technology and e-payments present a significant challenge for every company. The simplicity of electronic payment methods not only enables consumers to make purchases more conveniently but also saves them time and effort. Today, a vast majority of companies, government departments, and corporations have adopted electronic transactions as a means to enhance their profitability and operational efficiency across various sectors such as credit cards, banking, health insurance, automobile insurance, online auctions, and more. Beyond that, The process of sending and receiving money online through an e-payment account, without the need for credit or debit card information, has simplified money transfers and purchases. As a growing number of consumers engage with e-payment services, the financial landscape has shifted from physical cash transactions to exchanging credit card details online, over the phone, or in person (Ravikumar T, Suresha. B, Sriram. M, and Rajesh. R., 2020). This evolution signifies a transition from the physical exchange of tangible tokens of value to an exchange of information between parties.

With the emergence of electronic payments, where payment information is transmitted over public networks without a physical exchange between the buyer and the seller, the payment process has become increasingly digitized. Electronic payment is integral to e-commerce transactions, encompassing payments for goods and services over the Internet (Okunbor, Ateli, and Asogwa, 2019). This system is compatible with various devices such as automated teller machines (ATM), point-of-sale (PoS) terminals, internet payments, plastic money (e-purses, debit, and credit cards), mobile payments, wire transfers, and more. It facilitates direct payments and banking without the need for physical presence at government agencies, departments, and parastatals in Nigeria, leveraging electronic communication channels and other technological infrastructure.

Globally, financial systems and methods of transaction are evolving quickly. For convenient, quick, and easy business transactions, industrialized nations are more likely to migrate toward electronic payment than any other type of payment. Furthermore, the widespread acceptance of e-payment systems allows financial institutions, businesses, and government entities to offer a diverse range of payment options to their customers. These electronic payment systems are gradually replacing traditional methods that relied on personal contact between buyers and sellers. By doing so, e-payment systems contribute to cost reduction for both businesses and consumers. The efficiency and convenience associated with electronic transactions make them a preferred choice, fostering a shift away from older, more cumbersome payment methods. In order to align with developed economies, Cameroon must establish e-payment as the foundation for all financial transactions. Therefore, a survey will be conducted in order to assess  E- payment risk and control techniques in banking sector of Cameroon.

1.2 Statement of the Problem

E-payment is the key function for any e-business as it is rising exponentially in today's business world as e-business grows. E-payments made it easier for people to survive and helped them save a lot of money and time. Although electronic payments are quick, easy, and safe, there are a number of risks involved, including the possibility of fraud, cyberattacks, compliance problems, and operational breakdowns. According to Patgaonkar & Aditi(2020), to protect both organization and clients, it is essential to establish a robust risk management strategy for e-payment. However, from customers perspective, risks associated with electronic payments include the theft of payment information and passwords, fraudulent activities by scammers targeting financial service companies, and disputes regarding the quality of goods and services. The viability of e-payment system depends on how it overcomes the practical and theoretical challenges facing various online payment methods. It is in the light of these that the study seeks to assess E- payment risk and control techniques in the banking sector of Cameroon

1.3 Objective of the study

The main purpose of this study is to assess E- payment risk and control techniques in the banking sector of Cameroon. Specifically, the study will;

Determine the extent e-payment system is adopted in banking sector of Cameroon.

Determine the level of e-payment acceptance in banking sector of Cameroon.

Ascertain the risk factors associated with the adoption of e-payment system in banking sector of Cameroon.

Ascertain the control techniques required to ameliorate the factors affecting e-payment in banking sector of Cameroon.

1.4 Research Questions

The study will be guided by the following questions;

To what extent  is e-payment system adopted in banking sector of Cameroon?

What is the level of e-payment acceptance in banking sector of Cameroon?

What are the risk factors associated with the adoption of e-payment system in banking sector of Cameroon?

What are the control techniques required to ameliorate the factors affecting e-payment in banking sector of Cameroon?

1.5 Significance of the study

The government is undergoing a significant transformation in the process of disbursing payments, shifting from traditional paper checks to an entirely online system for government workers, contractors, and other beneficiaries. This transition is motivated by the need to address a prevalent issue wherein fraudulent individuals exploit the government, resulting in financial losses. The outcomes of this research are anticipated to guide the government in implementing necessary measures to curtail financial leaks and safeguard its funds. The adoption of digital transactions is expected to provide the government with enhanced control and monitoring capabilities, overseeing monetary transactions across diverse government departments nationwide. Furthermore, the study's findings will assist civil servants in better planning and managing their responsibilities, promoting effective governance. The move towards online interaction with government services will facilitate easier communication for the general public, allowing them to express their opinions and feedback. This transparent communication channel enables citizens to engage with government operations, sharing their perspectives on the government's performance. This open dialogue ensures alignment with public needs. Moreover, the research findings will serve as valuable material for subsequent researchers, contributing to the body of literature on the subject. 

1.6 Scope of the study

The scope of this study is boarded on E- payment risk and control techniques in banking sector of Cameroon. Empirically, this study will determine the extent e-payment system is adopted, the level of e-payment acceptance, ascertain the risk factors associated with the adoption of e-payment system and the control techniques required to ameliorate the factors affecting e-payment in banking sector of Cameroon.

Geographically, the study will be delimited to civil servants in Kumba, Cameroon.

1.7 Limitations of the study

Without certain limiting variables or restrictions, no significant and substantial academic activity has ever been undertaken. In that sense, the most significant constraints on this study were a lack of funding and a time crunch. A further restriction was the relative information sharing by the staff and management (respondents) of the company under examination.

1.8 Definition of terms

E-Payment- a digital payment for a transaction made on the internet.

Risk- a situation involving exposure to danger.

Control- the power to influence or direct people's behaviour or the course of events.

Technique- a skillful or efficient way of doing or achieving something.