Relationship between Mobile Banking and Financial Performance of Deposit taking savings and credit cooperatives in Kericho County, Kenya
Abstract
Deposit taking savings and credit cooperatives in Kenya have long struggled to adapt to the evolving technology which has seen several savings and credit cooperatives collapse as others incur losses. Mobile banking is a digital innovation that have diffused highly into financial institution creating competitive advantage. However, there is slow uptake of mobile banking in deposit taking saving and credit cooperatives. The study therefore seeks to establish the relationship between mobile banking and financial performance of deposit taking saving and credit cooperatives in Kericho County. It was guided by task technology fit theory; a correlational research design was adopted where the target population was 108 managers of all levels in the five deposits taking savings and credit cooperatives in Kericho County. Due to a small target population under study, this research adopted the census survey technique where all top, middle, and operational level managers were used. Data were collected by the use of primary and secondary methods. Content validity was conducted through engaging field experts and digital innovation professionals to determine the validity of the research instrument, while reliability was determined through test-retest of the questionnaires where 10 respondents were picked from Tenhos Sacco Society Ltd in Bomet County for piloting. Data was analysed using both descriptive statistics which comprises means and standard deviations while hypotheses were tested using correlation coefficient and multiple regression analysis. Data was presented in form of frequency tables and pie charts. The findings established that mobile banking had a strong positive relationship with financial performance of DT-Saccos (R = 0.729; β = 0.775). The study findings may be useful to the government in formulating strategies for effective and efficient deposit taking savings and credit cooperatives; will add value to the literature in the area of digital innovations in Saccos, and lastly, it may be of help to SASRA in understanding relationships between mobile banking and financial performance of savings and credit cooperatives.
Downloads
References
Anderson, P., & Tushman, M. L. (1990). Technological discontinuities and dominant designs: A cyclical model of technological change. Administrative science quarterly, 604-633.
Bagudu, H. D., Khan, M., Jan, S., & Roslan, A. H. (2017). The effect of mobile banking on the performance of commercial banks in Nigeria. International Research Journal of Management, IT & Social Sciences, 4(2), 71-76.
Bahati, J. M. (2018). Effects of Mobile Banking on the Financial Performance of Deposit Taking Saccos in Kenya. University of Nairobi.
Berman, S. and Payne, P. (2018) The Interaction of Strategy and Technology in an Era of Business Re-Invention. Strategy & Leadership, 46, 10-15.
Berti, G., Mulligan, C., & Yap, H. (2017). Digital food hubs as disruptive business models based on Coopetition and “shared value” for sustainability in the agri-food sector. Global Opportunities for Entrepreneurial Growth: Coopetition and Knowledge Dynamics within and across Firms, 415-438.
Chiinze, H., (2017) The impact of mobile banking adoption on financial performance: a case of Central Africa Building Society (CABS).
Goodhue, D. L., & Thompson, R. L. (1995). Task-technology fit and individual performance. MIS quarterly, 213-236.
James, I., & Prinsloo, C. (2017). Digital disruption: Changing the Rules of Business. Gordon Institute of Business Science, 24.
Leipziger, D., & Dodev, V. (2016). Disruptive technologies and their implications for economic policy: Some preliminary observations. Institute for International Economic Policy Working Paper Series, (13).
Madsen, E. S., & Hartington, S. (2015). Disruptive technologies and networking in telecom industries. Economics Working Papers No. 2015-21. Department of Economics and Business Economics, Aarhus University.
Maleto, D. K. (2016). Effects of financial innovation on growth of savings and credit cooperatives in Kenya. Unpublished Master Thesis. University of Nairobi.
Mosoti, Z., & Masheka, B. (2010). Knowledge management: the case for Kenya. Journal of Language, Technology & Entrepreneurship in Africa, 2(1), 107-133.
Muthiora, B. (2015). Enabling Mobile Money Policies in Kenya: Fostering a Digital Financial Revolution. Retrieved from www.gsma.com/mmu.
Muthui, A. N. (2013). Effects of information and communication technology on corporate strategy of SACCOs in Nyeri County. Unpublished master’s project. Kenyatta University. Nairobi, Kenya.
Njoroge, E. M., Muhoho, J., & Kibuine, M. (2019). Influence of customer relationship management system on performance of deposit taking SACCOs in Nairobi County. International Academic Journal of Human Resource and Business Administration, 3(6), 179-202.
Okiro, K., & Ndungu, J. (2013). The impact of mobile and internet banking on performance of financial institutions in Kenya. European Scientific Journal, 9(13).
Rawashden, A. (2015). Factors affecting adoption of internet banking in Jordan. International Journal of Bank Marketing, 33(4): 510-529.
SASRA. (2019). List of Sacco societies licensed to undertake deposit taking Sacco business in Kenya for the financial year ending 2019. Retrieved from: http://www.sasra.go.ke/index.php/regulation/capital-adequacy-for-deposit-taking-saccos#.V9k01jVObIU
World bank (2019). AFRONOMICS: M-Pesa and the Rise of Digital Financial Services in Africa. Retrive from https://www.worldbank.org/en/news/video/2019/03/27/afronomics-m-pesa-and-the-rise-of-digital-financial-services-in-africa
Copyright (c) 2022 Nancy Chepkorir, Raymond Kemboi, PhD, Alfred Bett, PhD
This work is licensed under a Creative Commons Attribution 4.0 International License.
