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Journal articles on the topic 'Kenyan Banking system'
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Fan, Hong, Allan Alvin Lee Lukaya Amalia, and Qian Qian Gao. "The Assessment of Systemic Risk in the Kenyan Banking Sector." Complexity 2018 (2018): 1–15. http://dx.doi.org/10.1155/2018/8767836.
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The present paper aims to assess the systemic risk of the Kenyan banking system. We propose a theoretical framework to reveal the time evolution of the systemic risk using sequences of financial data and use the framework to assess the systemic risk of the Kenyan banking system that is regarded as the largest in the East and Central African region. Firstly, we estimate the bilateral exposures matrix using aggregate financial data on loans and deposits from annual reports and analyze the interconnectedness in the market using network centrality measures. Next, we extend the Eisenberg–Noe method to a multiperiod setting to the systemic risk of the Kenyan banking system, in which the multiperiod includes the dynamic evolutions of the Kenyan banking system of every bank and the structure of the interbank network system. We apply this framework to assess dynamically the systemic risk of the Kenyan banking system between 2009 and 2015. The main findings are the following. The theoretical network analysis using network centrality measures showed several banks displaying characteristics of systematically important banks (SIBs). The theoretical default analysis showed that a bank suffering a basic default will trigger a contagious default that caused several other banks in the sector to go bankrupt. Further stress test proved that the KCB bank theoretically caused a few contagious defaults due to an unusually high interconnectedness. This methodology can contribute by being part of monitoring system of the Central Bank of Kenya (regulatory body) as well as the implementation of policies (such as bank-internal stress tests) that assist in preventing default contagion.
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Nyasha, Sheilla, and Nicholas M. Odhiambo. "Banking sector reforms in Kenya: Progress and challenges." Corporate Ownership and Control 10, no. 1 (2012): 88–96. http://dx.doi.org/10.22495/cocv10i1art8.
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This paper gives an overview of the banking sector in Kenya; it highlights the reforms since the country‟s independence in 1963; it tracks the growth of the banking sector in response to the reforms implemented over the past four decades; and finally, it highlights the challenges facing the banking sector in Kenya. The country‟s banking sector consists of more than 40 commercial banks, with the Central Bank of Kenya, which is the country‟s central bank, at the apex. Since the 1980s, the Kenyan government has implemented a number of banking sector reforms – in order to safeguard and improve the banking sector. The response to these reforms by the banking sector has been varied. As a result of these reforms, there has been a shift in the dominance from the State-owned banks to the private commercial banks. There has also been an improvement in the Central Bank‟s oversight of the financial institutions, and an enforcement of the banks‟ capital-adequacy requirements. By the standards of African countries, Kenya currently has one of the most developed banking systems in Africa. The country has enjoyed a substantial bank-based financial sector development over the years, and its institutional framework has also grown stronger. However, like many other developing countries‟ financial systems, the Kenyan banking system still faces wide-ranging challenges, such as high interest rate spreads and financial inclusion challenges
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Mutisya, Maria Mueni, and Gerald Atheru. "Electronic Banking and Financial Performance of Commercial Banks in Kenya." International Journal of Current Aspects 3, no. II (May 31, 2019): 293–304. http://dx.doi.org/10.35942/ijcab.v3iii.24.
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Information technology has changed the traditional ways of doing business to a digital and electronic way that has led to globalization. The banking industry has been forced by the wave of electronic payment system in the business environment to change from its traditional ways such as: long queues as customers waited to be served, delay in the clearing house as representatives of different banks waited to settle their dues and manual work that resulted to errors. The main purpose of the study was to determine the effect of electronic banking on the financial performance of commercial banks in Kenya. The specific objectives were to determine the extend of internet, mobile, automated teller machine and debit/credit card banking adoption and its effect on financial performance. The study covered a period of five years that is from the year 2011 to the year 2015 and adopted descriptive research design. The data collected was analyzed by the use of both descriptive and inferential statistics procedures. Primary and secondary data was collected from the 34 commercial banks that responded leading to a respond rate of 79.04% out of the 43 commercial banks. The trade analysis showed that internet banking was recognized and accepted by the Kenyan commercial banks and the Kenyans as a way of transacting. Electronic banking was found to be positive and significantly related to the financial performance of the commercial banks in Kenya. This was attributed by an R Square of 0.688 for Return On Assets, 0.63 for Net Profit and 0.277 for Return On Equity indicating that the independent variables in the study were able to give information of up to 68.8%, 63% and 27.7% respectively while the remaining 31.2%, 27% and 72.3% could not be explained in the study but could be explained using other variables outside the study. All the independent variables were (internet banking, Mobile banking, Automated Teller Machine banking and Debit/Credit banking) found to be positively and significantly related to the Return On Assets while only mobile banking and internet banking were found to be positively and significantly related to Net Profit since their p Values were less 0.05. Automated Teller Machine banking showed a positive relation that was insignificant with the Return On Equity.The study recommends that, electronic banking should be employed by commercial banks through proper management policies since it has shown improved efficiency and financial performance. For further studies, areas of crime technology, quality of banking services, electronic fund transfer and performing loans should be looked at.
This is an open-access article published and distributed under the terms and conditions of the Creative Commons Attribution 4.0 International License of United States unless otherwise stated. Access, citation and distribution of this article is allowed with full recognition of the authors and the source.
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Baer, Wolfgang, Ahmed Bounfour, and Thomas J. Housel. "An econophysics non-monetized theory of value." Journal of Intellectual Capital 19, no. 3 (May 14, 2018): 519–35. http://dx.doi.org/10.1108/jic-01-2017-0001.
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Purpose Mobile phones are radically transforming micro-finance in Sub-Saharan Africa, and Kenya, in particular. The introduction of the micro-financial transaction mobile phone application, “MPesa,” created a means to facilitate micro-transactions without the need for an intermediary, such as a banking system. The purpose of this paper is to posit an econophysics model to predict the value of Mpesa for Kenyan and South African consumers. The econophysics framework posits several fitness matrices and a distance measure that can account for the concepts of mass, distance, momentum, velocity, action, and force. The authors begin with a table of the match between the physics concepts and the economic concepts followed by the vector model that utilizes these concepts for the MPesa application case. In this paper, the authors will argue that MPesa succeeded in Sub-Saharan African countries, such as Kenya, because the fit between what this group of customers needed and the solutions Safaricom’s MPesa offered was a better fit with a smaller distance to adoption than in the South African case. Design/methodology/approach The research develops an econophysics approach to the assessment of micro-finance development in Sub-Saharan countries. Findings The research shows clearly the reasons of the success of MPesa in Kenya in comparison of its relative failure in South Africa: the distance between customers’ expectations and the system supply. Research limitations/implications The research is limited to two case studies and needs to be extended to other contexts, in order to demonstrate its robustness, especially with regard to the intangible dimension, e.g., the distance between a system potential and what it really offers. Practical implications The research shows the importance of system’s characteristics in its success. Social implications The social implications are very high, especially in this case, where micro-finance is a high stake for developing societies. Originality/value This is one of the first works to develop an econophysics approach for the evaluation of the key characteristics of a system.
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Alubisia, L’souza Boniface, Wainaina Githii, and Mirie Mwangi. "Effect of Technology Based Financial Innovations on Non-Interest Income of Commercial Banks in Kenya." European Scientific Journal, ESJ 14, no. 7 (March 31, 2018): 337. http://dx.doi.org/10.19044/esj.2018.v14n7p337.
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Technology based financial innovation has had a great impact on the financial industry as a whole over the past few decades. It has presented the banking sector with an opportunity to increase the revenue base. This study intended to identify the impact of technology based financial innovation on non-interest income in Kenyan commercial banks. The study investigated how the adoption of ATMs and Cards, Internet and Mobile Banking and use of Funds Transfer Systems such as RTGS and EFT has impacted the non-interest income of commercial banks in Kenya. Descriptive research design was utilised. The study found that technology based financial innovation has significant effect on the non-interest income earned by commercial banks in Kenya. It recommends all stakeholders in commercial banks to take any investments made towards technology based financial innovation products as a strategy to improve non-interest income
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Nzuve, Stephen N. M., and Edith A. Omolo. "A STUDY OF THE PRACTICE OF THE LEARNING ORGANIZATION AND ITS RELATIONSHIP TO PERFORMANCE AMONG KENYAN COMMERCIAL BANKS." Problems of Management in the 21st Century 4, no. 1 (July 15, 2012): 45–56. http://dx.doi.org/10.33225/pmc/12.04.45.
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The objective of the study was to investigate the extent of the practice of the learning organization within the Kenyan commercial banks and determine the relationship between the aforementioned practice with organizational performance. The study adopted a descriptive survey design. It was a census survey comprising all the 43 banks licensed to operate in Kenya under the banking Act. The sample frame included all the commercial banks listed in the Central Bank of Kenya website. The 43 banks were further divided into 3 tiers based on profitability for the year 2008 as indicated in the Banking Survey 2009. Primary data was collected using a structured questionnaire while secondary data regarding organizational performance was obtained from the banking survey 2009. The data collected was analysed using descriptive statistics in terms of frequency and percentage tabulations, cross tabulations and Pearson’s correlation coefficient to determine the relationship between the practice of the learning organization and organizational performance. The study established that most Kenyan commercial banks had to a large extent adopted the following practices adopted by most organizations: development of information systems designed to inform and empower, formative accounting control, learning approach to strategy development, participative policy making, reward flexibility and supportive leadership. The practices least adopted were the ones involved in enabling structures, creating a learning climate and boundary workers as environmental scanners. Findings indicate that there is an inverse relationship between the practice of the learning organization and organizational performance. This would suggest that there are other factors that have to be taken into account to determine and explain this discrepancy, hence the need for further study. In conclusion, the study established that two thirds of the Kenyan banks had adopted the practices of the learning institution. The study also indicates that there is a tendency for Kenyan commercial banks to focus on certain aspects of the learning organization instead of seeing the whole picture and focusing on the organization as a dynamic entity. Interest in the learning organization has been stimulated by the need to attain sustainable competitive advantage The researcher recommends that the Kenyan commercial banks should embrace more systematic, definite and concrete steps towards adopting a learning culture, in order to survive the onslaught of competitive forces in the global market. The study suggests further investigation into whether the practices were adopted as part of a systematic strategy to develop the banks as learning organizations or whether they were simply adopted on an ad hoc basis for purposes of expediency and organizational survival. Key words: learning organization, organizational learning culture, performance indicators, sustainable competitive advantage, global business environment.
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Kibicho, Nahashon Kairo, and John Mungai. "Mobile Banking Adoption and Financial Credit Accessibility in Wote Sub – County, Makueni County, Kenya." International Journal of Current Aspects 3, no. IV (July 6, 2019): 65–79. http://dx.doi.org/10.35942/ijcab.v3iiv.47.
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Although the financial system is a vital component of the socio-economic development of any nation, most Kenyans lack access to formal financial credit services. This arises due to the cause of putting up bank branches in the rural areas is deemed not economically viable. Most banks have partnered with Mobile Network Operators to help mitigate this problem by introducing the use of Mobile banking (M-banking) technology in accessing vital banking services such as financial credit. However, this effort may not attain success if the factors inhibiting the use of M-banking technology have not been assessed. The purpose of this study was to establish the effect of Mobile banking adoption on financial credit accessibility by residents in Wote sub-county. This study was necessitated by the current emerging trend of accessing financial credit through the Mobile banking system. This study adopted a technology acceptance model to establish the effects of adopting mobile banking and its application in use of banking services among residents of Wote sub-county. The study was guided by the following objectives: To establish the effect of perceived usefulness, perceived ease of use, and perceived risk of using mobile banking technology and financial credit accessibility in Wote sub-county, Makueni county, Kenya. Descriptive research design was employed in which the study population comprised the residents of Wote sub-county. The target population of the study consisted of 137,944 mobile money users across both banked and non-banked population in Wote sub-county and the sample size comprised of 138 participants who were selected through the use of simple random sampling technique. Data was collected using a questionnaire whose reliability was established by use of Cronbach’s Alpha. All items in the questionnaire had a score of above 0.7 which was deemed to be the acceptable threshold. The questionnaires were administered through drop and pick later method. The data collected was processed and analysed using SPSS. Descriptive statistics such as percentages, frequencies, standard deviation and mean scores were used. Afterwards, the research findings were presented using frequency tables, pie charts and bar graphs. Multiple regression analysis was used to analyse and draw inferences from the research data. The results indicated that perceived usefulness of mobile banking technology perceived ease of use of mobile banking technology, and perceived risk of using mobile banking technology were statistically significant in accessing of financial credit. The intervening variable- customers’ attitude- was found to be non-significant. This study recommended that both the banks and MNO’s to continuously invest in product improvement of mobile banking systems to ensure the uptake of mobile credit is enhanced. The study also recommended that the financial service providers should engage in education and extensive customer awareness on use of mobile applications to access mobile credit as well as draw up strategies to reduce the mobile phone operational costs such as the interest charged on mobile loans which are a major hindrance. Further, the banks and MNO’s should increase extra security features in their systems to increase trust in accessing mobile credit. Finally, the service providers should make mobile banking more user friendly for ease of financial credit access by incorporating graphics interface.
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Mugane, Maurine, and Reuben Njuguna. "Mobile Banking Services with Financial Performance on Commercial Banks in Kenya." International Journal of Current Aspects 3, no. VI (November 22, 2019): 176–92. http://dx.doi.org/10.35942/ijcab.v3ivi.84.
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The competition dimensions have changed following the adopting of various internet banking services that came about as a result of technological innovations such as the introduction of Automated Teller Machines (ATMs), phone banking Personal computer banking which were some of the first innovations of electronic finance. The main objective of this study was to establish the impact of mobile banking services on the financial performance of commercial banks in Kenya. The specific objectives guiding this study included to assess the influence of short message service (SMS) banking on the financial performance of commercial banks in Kenya, to establish the effect of person to person payments on the financial performance of commercial banks in Kenya, to determine the effect of bill payments on the financial performance of commercial banks in Kenya and to find out the effect of airtime top up service on the financial performance of commercial banks in Kenya. The research design that the study adopted was a descriptive research design employing quantitative research strategies. In this study the target population under investigation was all the 40 commercial banks in Kenya. Since in the current study the target population was 80 participants from all the 40 commercial banks in Kenya a census inquiry method was the best method used. Primary data for this study was collected through the use of a questionnaire that was given senior managers from all the departments of these organizations. Both quantitative and qualitative data was generated in this study. Qualitative data was analysed using content analysis whereby content of responses was looked at and responses were grouped together in relation to common patterns or themes for coherent categorization. Descriptive statistics included measures of central tendency and dispersion thus standard deviation and mean and use of absolute and relative percentage frequencies. Presentation of quantitative data was in form of graphs and tables and explanation given in prose. The study findings show that short message service had an above average positive correlation with financial performance of commercial banks and was statistically significant. Person to person had an average correlation with financial performance of commercial banks and was statistically significant. Bill payments had a strong positive correlation with financial performance of commercial banks and was statistically significant. Airtime top up service had an strong positive correlation with financial performance of commercial banks and was statistically significant. The study concludes that short message service banking has become and important part of banking, more and more people prefer to receive banking alerts through short message service which has not only improved service delivery but has had a positive impact on financial performance. Commercial banks have experiences large revenues from different activities with the banking system core among them the bill payments activities. The study recommends that it is important for commercial banks to focus more on short message service banking to lower operational costs thereby improving financial performance. Commercial banks need to consider using person to person payments to improve on their performance, they need to enhance their bill payments to get more clients paying bills using their systems so as to improve on their financial performance and that it is important for commercial banks to put more effort on airtime top up service so as to improve on their financial performance.
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Karimi, Kirima Lucy. "Effects of Agency Banking on Bank Performance: A Case of Equity Bank Meru Branch, Kenya." Business and Economic Research 8, no. 4 (November 21, 2018): 100. http://dx.doi.org/10.5296/ber.v8i4.13941.
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The purpose of this study was to establish the effects of agency banking on bank performance with a focus of Equity Bank Meru Branch, Kenya. The reason for the selection of Equity Bank was because of its large customer base and because of its growth. The study adopted a descriptive research design and the target population was the eighteen agency bank agents. The study used stratified random sampling to select 11 agents that were used in the study. Both quantitative and qualitative data was collected by use of questionnaires with both open and closed ended questions. Data was analyzed and presented using descriptive statistical tools. The study findings indicated that the general cost such as operations and transactions cost were still high even for agency banking, security measures were in place that is physical security though it needed strengthening, transaction security and customer security were not good and needed improvement and the regulations that were in place for agency banking also needed to be improved. The study made the following recommendations: For agent banking operations to be effective, strong internal control systems should be put in place which should be flexible and be evaluated periodically to increase efficiency and effectiveness; there should also be frequent updates of regulations and policies that guide agency banking and procedures that are used in the banking and agency industry in Kenya. Bankers Association in consultation with the Central Bank of Kenya should carry out frequent audit and research in relationship to agency banking to determine any loopholes and challenges in order to advice the banks accordingly. Also banks should work closely with the agents in order to streamline the systems and processes to help achieve efficiency. The results gathered out of the audit and research will help the banks to keep their agents updated.
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Abubakar, Abbas Said, and Dr Josiah Aduda. "ISLAMIC BANKING AND INVESTMENT FINANCING: A CASE OF ISLAMIC BANKING IN KENYA." International Journal of Finance 2, no. 1 (January 23, 2017): 66. http://dx.doi.org/10.47941/ijf.42.
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Purpose: The purpose of this study was to establish the effect of Islamic banking on investment financing in Islamic banks in Kenya.Methodology: This study employed descriptive survey design. The population of this research consisted of 8 commercial banks offering Shariah compliant products. The study used secondary data for the period 2009 to 2012. Data was analyzed using Statistical Package for Social Sciences (SPSS) and results were presented in frequency tables and figures. The data was then analyzed in terms of descriptive statistics like frequencies, means and percentages.Results: The study findings indicated that there were various Islamic banking products that Islamic banks used to finance their investments. This included motor vehicle financing, mortgage financing, asset financing, real estate financing, trade financing and SME financing. The study also indicated that there were various modes of financing used by Islamic banking such as profit and loss sharing, Ijara and murahaba. Regression results revealed that motor vehicle financing was statistically significant in explaining loans advanced to customers in Islamic banks. However mortgage financing, asset financing, real estate financing, trade financing and SME financing were not statistically significant in explaining loans advanced to customers in Islamic banks but they were positively correlated.Unique contribution to theory, practice and policy: The study recommends that the management of the banks to get well equipped and competent employees on Islamic banking products as most Islamic banks are currently managed by people who have been educated and trained in the conventional banking system. Thus, more time may be required for the unique characteristics of Islamic financial instruments to be completely accepted and understood by both bank personnel and customers. It is also recommended that the terms and conditions of acquiring a loan be made more appealing and considerate for more investors to approach the banks for assistance as the Shari`ah restricts the type of businesses for which Islamic banks can provide financing.
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Wanyonyi, Kizito Simiyu, and Dominic Ngaba. "Digital Financial Services and Financial Performance of Savings and Credit Cooperative Societies in Kakamega County, Kenya." International Journal of Current Aspects in Finance, Banking and Accounting 3, no. 1 (July 9, 2021): 9–20. http://dx.doi.org/10.35942/ijcfa.v3i1.177.
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Savings and Credit Co-operative Societies (Saccos) in Kenya have realised a tremendous growth in the subsector and are investing huge amount of their scarce financial resources in digital technology to enhance services delivery and offer a wide variety of products and services range, increased membership mobilisation and size, ensure better structure and effective financial performance. Digital financial Services as used in the Saccos industry is as a result of Information Communication Technology revolution commonly referred to as digital commerce. Many Saccos are steadily changing from manual banking system of operations to providing digital Financial (e-banking) services that include internet banking, M-banking and Automated Teller machine support. The adoption of digital financial Services by the Saccos is a strategic attempt to deal with increased cut throat competition from traditional banking institutions and non-banking financial institutions, to cut costs and add value to their services in order to optimise benefits to the shareholders. Despite the fact that Saccos have rapidly adopted digital financial services to provide services, and that they drive a huge section of the financial sector savings of the economy, they have experienced various challenges such as uncertainty and risk due to digital financial services. The study sought to establish the influence of digital financial services on the financial performance of SACCOs in Kakamega County, Kenya. The specific objectives was to determine the effect of the mobile banking, internet banking, use of credit cards and digital funds transfer on the financial performance of SACCOs in Kakamega County, Kenya. The research was guided by three theories of innovation and technology: Diffusion of Innovation Theory, The Theory of Task-Technology Fit Theory and the Technological context, Organisational context and Environmental context Theory.The study used a descriptive research design. The population of study were staff at the three SACCOs operating in Kakamega County. This consisted of 162 respondents who are the staff of the SACCOs. A sample of 49 respondents was taken which forms 30% of the target population which shall be evenly spread across the three SACCOs. The primary data was collected by use of self-administered semi-structured questionnaire.Collected data was analysed through descriptive and inferential statistics by the use of SPSS. Findings were presented by use of tables, frequencies, percentages, means and standard deviation.The study found that the financial performance of the SACCOs was significantly influenced by the digital financial services instituted by the SACCO managements. They demonstrated to have reliable mobile banking system where most of their customers had enrolled on the mobile banking platform and most of customer queries and updates were sorted via the mobile platform.Given the limitations and findings of this study, the researcher recommends that since there exists a positive relationship between digital financial services and bank performance and that e-banking has brought services closer to bank customer’s hence improving banking industry performance, SACCOs must also enhance the dynamics of the sector and embrace digital banking fully and extensively. Mobile banking faces various challenges among them being, system delays by the mobile money transfer service providers, slow processing of transactions, high transactions costs, limit on the amount of money that can be withdrawn in a day and fraud.
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Melubo, Kisotu David, and Salome Musau. "Digital Banking and Financial Inclusion of Women Enterprises in Narok County, Kenya." International Journal of Current Aspects in Finance, Banking and Accounting 2, no. 1 (May 11, 2020): 28–41. http://dx.doi.org/10.35942/ijcfa.v2i1.104.
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Financial inclusion is an important step in development, as access to finances can help the women to build money and lift themselves out of poverty. Lack of financial inclusion among women in Narok County is one of the many factors leading to financial exclusion and an introduction of digital banking is the remedy to its problems. Financial inclusion of women contributes immensely in empowering them. Digital banking in Kenya has been characterized by rapid technological change in the finance sector that has led to the development of mobile banking, online banking, ATMs and agency banking. The banking sector has undergone substantive transformation particularly from the year 2007. This study sought to establish the effects of digital banking and financial inclusion of Women Enterprises in Narok County, Kenya. Financial inclusion includes the provision of affordable financial services, which includes; access to payments and remittance facilities, savings, loans and insurance services by the formal financial system to those who tend to be excluded The study was anchored on finance growth theory and financial asymmetric theory. This study used descriptive research design and data was collected from the target population of all the 184 women owned enterprise in Narok County, Kenya. For this study census sampling was adopted to where all the population will be included in study since the number of target population is 184. Primary data was collected using a semi structured questionnaire to be administered to the women business owner through face to face interviews. The collected data was analysed using descriptive statistics methods; mean, mode, median, standard deviation, percentages and frequencies. Inferential statistical methods included multiple regression analysis was used to establish the relationship among variables. It was established that digital banking services significantly and positively influenced financial inclusion of women enterprises in Narok County. The study concluded that agency banking, mobile banking, online banking and ATM services significantly influenced the access and use of banking services by the locally based women enterprises in Narok County. It was further concluded that the women enterprises did not adequately use online banking due to limited literacy level, computer proficiency and internet availability. The study recommends that the available financial sector players in Narok County needs to sensitize SMEs especially women-owned to ensure that they are aware of the digital services available to be in the loop to enhance financial inclusion. The study recommends that the available digital banking providers need to improve formation of groups among the users of the services to enable improve usability. The study recommends further that the women enterprises managers and proprietors need to be in groups to develop each other and assist access, use and improve digital banking and financial inclusion.
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(CIPIT), Centre for Intellectual Property and Information Technology. "Privacy and Data Protection Practices of Digital Lending Apps in Kenya." Journal of Intellectual Property and Information Technology Law (JIPIT) 1, no. 1 (June 4, 2021): 131–69. http://dx.doi.org/10.52907/jipit.v1i1.68.
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The Centre for Intellectual Property and Information Technology Law (CIPIT) has been studying the impact of digital identities on society. This has included policy research on the legal and technical aspects of the national digital ID system Huduma Namba under which the Government is integrating all its identification documents. This research shows that the national digital identity system also integrates with privately issued digital identities such as mobile phone numbers and social media accounts. We anticipate that as national digital ID uses increase, so will the linkage with private systems. This is already evident from e-government services, where payments for Government services, such as passport applications, drivers’ licences, national health insurance and hospital bills in public hospitals are made using mobile money platforms. We also appreciate that private digital ID is more developed and has more uses than national digital ID. For example, a 2019 survey, undertaken by the Central Bank of Kenya (CBK), estimates that access to financial products had risen from 26.7% in 2006 to 89% of the population in 2019. This is attributed partly to the availability of digital products such as “mobile banking, agency banking, digital finance and mobile apps”. These products make use of personal data, which broadly falls under digital identities. This study seeks to understand the privacy implications of digital ID by looking at digital lending apps.
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Michael, Okoche. "Political Dimension in Pan-African Cross-border Banking: An Inhibitor or Catalyst?" Business and Management Studies 5, no. 1 (January 22, 2019): 1. http://dx.doi.org/10.11114/bms.v5i1.3984.
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The emergence and the dominance of African banks in Africa have been touted as one of the popular mechanisms for financial development leading to a concept termed as Pan-African cross-border banking. African Banks have become dominant in the African market as opposed to European colonial banks substantially increasing their geographic footprints on the continent. African banks have become economically significant beyond their home countries and of systematic importance in a number of jurisdictions. This systematically examined the influence of the political environment on Pan-African cross-border banking using Kenya Commercial bank as a case study.Interpretive research paradigm guided the study seeking using qualitative data by interviewing employees, managers, and policymakers from the three subsidiaries of Kenya Commercial Bank; Uganda, Rwanda, and Burundi. This was further supported by secondary data collected from journal articles and reports from the Kenya Commercial Bank.The study established that political environment plays an important role in influencing Pan-African cross-border banking either through catalysing or inhibiting. Despite effort integration by African Union, regional unions like East African Community there still areas for improvement. In order to enhance Pan-African cross-border banking, there has to be systematically management of political environment which was distorted by history, ideologies, different political systems, different regulatory frameworks between the subsidiaries and home countries. This will further enhance the significance of Pan-African banks African cross-border banks enhancing economic development within Africa.
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Ndungu, John Gichia, and Willy Muturi. "Effect of Diversification on Financial Performance of Commercial Banks in Kenya." International Journal of Current Aspects 3, no. V (October 31, 2019): 267–85. http://dx.doi.org/10.35942/ijcab.v3iv.67.
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Diversification plays a vital role in risk management and consequently financial performance of commercial banks. Diversification mitigates systemic risk facing a commercial bank and thus reduces the probability of bank failure. In Kenya, commercial banks have been diversifying their business by increasingly offering new services such as mobile banking, agency banking, bank-assurance, faceless banking and integrating microfinance in their banking system. Diversification by the commercial banks is premised on the need to enhance financial performance. This has mainly emanated from banking industry having undergone numerous regulations regimes which over the years have affected financial performance of these entities. Empirical literature shows that diversification may not always lead to higher financial performance due to increased overheads and exhausted economies of scale. The study sought to determine the effect of diversification on financial performance of commercial banks in Kenya. The specific objectives of the study were to determine the effect of income diversification on financial performance of commercial banks in Kenya, to examine the effect of geographical diversification on financial performance of commercial banks in Kenya and to examine the effect of product diversification on financial performance of commercial banks in Kenya. Secondary data used by the study was collected for five years period (2013-2017 on annual basis). All the commercial banks were studied. Data was analysed using descriptive and inferential statistics and presented in tables and figures. The study found that Income Source Diversification and Geographical Diversification had a positive effect on the financial performance of the commercial banks while the Product Diversification had a negative impact the financial performance the commercial banks. The findings from the OLS regression analysis revealed that the diversification components studied namely product diversification, geographical diversification and income diversification explain up to 13.3% of the variations in return on assets (R2=0.133) and 18.7% of the variations in return on equity (R2=0.187). The study concluded that financial performance of the commercial banks in Kenya can be accounted for by the diversification strategies that have been implemented. It was further concluded that increased formulation and implementation of additional diversification strategies resulted in significant improvement in the financial performance of the commercial banks. The study recommended that managers at the commercial banks to make formulation and implementation of diversifications as a key organizational priority. Before the adoption of any particular diversification, the management of the commercial banks are econcouraged to first determine the suitability of that particular diversification strategies based on the organization structure, culture and policies and the overall intended outcomes. The study recommends that the government and other regulatory bodies to create favourable policies on the implementation of diversifications in commercial banks. This will ensure that there is effectiveness, efficiency as well as consistency in the use and adoption of diversifications by not only the banks but also other organizations in different sectors.
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Magutu, Peterson Obara, Nixon Onchara Muganda, and Gladys Monchari Ondimu. "THE FACETS AND ECONOMIC BENEFITS OF THE INFORMATION COMMUNICATIONS TECHNOLOGY AND INNOVATIONS USED BY COMMERCIAL BANKS IN KENYA." Problems of Management in the 21st Century 2, no. 1 (December 5, 2011): 121–40. http://dx.doi.org/10.33225/pmc/11.02.121.
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The recent developments in the Information Communication Technology (ICT) have been received with great interest in research and practice by the banking community the world over. There began to appear theoretical arguments regarding the role of information technology (IT) in creating the value chain at firms and this opened up new lines of inquiry. This paper was a survey on the business value of information communication technologies in the financial departments of commercial banks in Kenya. In recognizing the significance of ICT in economic stability and growth of a country, it should not be lost on the consumers of the technologies that risks abound in every opportunity. It has also been noted that the pace of legislating the sector much of the time is overtaken by technological advancements that are directly linked to the banking sector. The research findings and recommendations are therefore expected to assist in building into the ICT and business value at departmental level, as a body of knowledge. Data was collected from a population that comprised of forty-four commercial banks incorporated and, or licensed to operate in Kenya by 2007. It was found that the two commonly used technological tools in cash management in the finance department are the financial software and e-banking. Also, the five key economic benefits of the information communications technology and innovations that have accrued to the commercial banks in Kenya at their finance departments include: ICT use has ensured proper management of account balances at value dates; ICT has helped in the monitoring and optimization of the sales-cash circuit; ICT has led to system responsiveness to changing user needs; and ICT has helped in the coverage of exchange-rate risk. Key words: facets, benefits, information communications technology, commercial banks and Kenya.
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Jesse Nakhumwa, Ndubi. "Adoption of E-commerce Payment Systems by Commercial Banks in Kenya." INTERNATIONAL JOURNAL OF MANAGEMENT & INFORMATION TECHNOLOGY 9, no. 2 (April 30, 2014): 1600–1622. http://dx.doi.org/10.24297/ijmit.v9i2.2853.
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E-commerce, which is combination of traditional commerce and Internet, has brought dramatic changes of the way business transactions are conducted prompting banks, as the intermediary financial instruments, to adopt and adapt electronic payment systems (EPS). These e-payment systems which include debit and credit cards, electronic fund transfer, mobile payments platforms and internet banking are already in use in Kenya market. Importantly to note is the fact that electornic payment instruments are not used with equal intensity even in developed countries due to various reasons. The research thus is focused on identifying key drivers for adoption of EPS in Kenya market by banks.The researcher identified major variables affecting adoption of EPS which included security status, perceived level of trust, infrastructure capability to handle the system, marginal cost reduction and perceived associated benefits. A descriptive census survey of all the 43 banks was then done through a structured questionnaire. With a id of technology acceptance model and DeLone & McLean Information System Success model, the data collected was empirically analysed and results presented.With different intensity, the findings of the study revealed that many banks in Kenya are implementing EPS platforms. The driving forces for the adoption are the factors identified in the conceptual framework of this study. Bank respondents successfully did the rating of these factors. Therefore, the study recommends for a concerted effort amongst EPS key players to streamline operations in their area of concern. They should establish policies and legal framework good for electronic transactions as well as building sound telecommunication infrastructure countrywide. Again, this study is just but a stepping-stone to a better analysis that will unlock the potential of e-payment systems. The researcher encourages both academicians and practitioners to critique the study findings.
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Njue, Michael Njeru, and Marion Mbogo. "IMPROVING ACCESS TO BANKING PRODUCTS AND SERVICES FOR SMALL AND MEDIUM ENTERPRISES IN KENYA." International Journal of Finance 2, no. 3 (February 13, 2017): 47. http://dx.doi.org/10.47941/ijf.102.
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Purpose: The purpose of this study was to highlight the need for banks to develop financial products and services for small and medium enterprises.Methodology:The research design was descriptive survey study. The target population was 46 commercial banks .The sampling frame was the list of commercial banks given at the Central bank of Kenya Website. A sample of 17 banks was selected using random sampling. The second stage of sampling involved the selection of the respondents using a stratified sampling approach. The strata were the various departments that interact with SMEs in a bank. The respondents were the head of departments of the respective departments that form the strata. Both qualitative and quantitative data was collected using a questionnaire that consisted of both open ended and close ended questions. Data was analysed using Statistical Package for Social Sciences (SPSS.Results: One of the study objectives was to establish the level of access to financial products and services offered by the banks to SMEs. Results from the bank manager’s perspective indicated that the level of access to finance was high, but the bank clients indicated otherwise, that it was low. The other objective of the study was to determine the factors that hinder the SMEs from accessing the financial products offered by banks. Results indicated that several factors influence access of SMEs to finance. These factors include gender, level of education, size of the business, age of the entrepreneur, collateral, and level of income for the entrepreneurs. All the factors had a negative effect on the access of finances from the banks by SMEs and hence indicate SMEs low access to financial products. Another objective of the study was to establish the tools or systems required to improve accessibility to financial products offered. Results indicated that there are tools and systems put in place by banks to improve accessibility to financial products offered to small and medium enterprises.Unique contribution to theory, practice and policy:The study recommended that training be emphasized to SME entrepreneurs on financial matters, all gender to be treated equally, the banks to introduce financial education programs for SMEs to improve their access to credit, banks to further make use of a credit scoring system to assess the credit worthiness of small businesses and to introduce the use of new credit bureau regulations to increase SME finances.
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Antony, Atellu, Muriu Peter, and Sule Odhiambo. "The Role of Banking Concentration on Financial Stability." International Journal of Economics and Finance 13, no. 6 (May 18, 2021): 103. http://dx.doi.org/10.5539/ijef.v13n6p103.
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Globally, financial instability is a major source of concern among policy makers and bank regulators, particularly after the 2007-09 global financial crisis. Motivated by inconsistent theoretical evaluations on the impact of bank concentration on the likelihood of a systemic banking crisis, this paper investigates the role of bank concentration on financial stability in Kenya with competition as an intervening variable. The novelity of this study lies on the use of structural equation modeling (SEM) in the analysis of direct and indirect effects of bank concentration on financial stability. Results show that higher concentration induces banks to increase cost of service provision which may aggravate credit risks and expose banks to systemic risks. Further, competition plays a significant role in ensuring financial system stability which supports the ‘competition-stabiliy’ hypothesis. Uncompetitive banking industry may therefore provide incentive for banks to take excessive risks, which renders them vulnerable to systematic risks. We also establish that tight regulations enhances concentration and financial stability but hinders competition. These new insights give bank regulators and policy makers an incentive to formulate and implement the right policies to improve financial stability.
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Mburu, Irene Muthoni, Lucy Wamugo Mwangi, and Stephen M. A. Muathe. "Credit Management Practices and Loan Performance: Empirical Evidence from Commercial Banks in Kenya." International Journal of Current Aspects in Finance, Banking and Accounting 2, no. 1 (May 31, 2020): 51–63. http://dx.doi.org/10.35942/ijcfa.v2i1.105.
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Commercial banks in Kenya as per the World Bank report were recording higher non-performance in loans over the study period than the standard globally in spite of Kenya having the most stable and developed banking system in East and Central Africa region. Commercial banks non-performing loans for five years from 2015 to 2018 averaged eleven percent which was higher than the recommended rate of one percent. In Kenya, commercial banks’ non-performing loans remain higher than the recommended rate which could be due to inadequate credit management practices. The study therefore aimed at examining the effect of credit management practices on loan performance of commercial banks in Kenya. Specifically, the study sought to establish the effect of debt collection policy, client appraisal and lending policy on the loan performance of commercial banks in Kenya. The underpinning theory of the study was the 5Cs model for credit. The study used explanatory research design and the research philosophy adopted was positivism. The target population was 44 commercial banks in Kenya and a census approach was used. Both primary and secondary data were used. Primary data was collected through structured questionnaires and related to credit management practices while secondary data was obtained from review of existing bank loan records in relation to loan amount advanced and non-performing loans for a period of four years from 2015-2018. The data collected was analyzed using both descriptive and inferential statistics with the help of SPSS version 22. The study found out that debt collection policy and lending policy had a positive significant effect on loan performance of commercial banks in Kenya. However, client appraisal had no significant effect on loan performance of commercial banks in Kenya. Therefore, the study concluded that commercial banks’ loan performance could be largely attributed to the efficiency of the credit management practices put in place at the institutions. The study recommended that commercial banks to regularly evaluate and update practices relating to debt collection policy, client appraisal and lending policy that are capable of ensuring that credit risks are identified and recorded from departmental level to the institution at large. This is vital in light of technological innovations in the banking sector like mobile lending that may limit commercial banks’ ability to evaluate and manage credit using traditional methods.
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Moturi, Christopher, and Prester Mbiwa. "An evaluation of the quality of management information systems used by SACCOs in Kenya." TQM Journal 27, no. 6 (October 12, 2015): 798–813. http://dx.doi.org/10.1108/tqm-05-2015-0065.
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Purpose – Savings and Credit Cooperatives (SACCOs) in developing countries require core banking Management Information Systems (MISs) to run their business, serve their clients and provide differentiated products and services to gain competitive advantage. Considering that SACCOs in Kenya lack the necessary resources to acquire the best information systems, the purpose of this paper is to evaluate MISs currently in use in the SACCO subsector to determine how well they are serving. Design/methodology/approach – Using the ISO/IEC 25010 Software Product Quality Model, the quality of MISs operated by 215 Deposit-Taking SACCOs in the Kenya was evaluated to determine their level of performance. Findings – The results indicated that the MISs currently in use by the SACCOs serve them well in terms of functionality, efficiency, reliability, ease of use and portability. However, vendor support, technical training and implementation process are a big concern to the SACCOs. Practical implications – The SACCOs in Kenya need not look for other MISs as the ones in use satisfied the condition required by the ISO/IEC 25010 Software Product Quality Model. The areas that require attention are vendor support services by entering into contracts technical training and service level agreement; and good project management in software implementation. Originality/value – The research addresses itself to one of the biggest setbacks faced by a fast growing subsector in adopting ICT with limited capacity and infrastructure.
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Thuita, Joyce, and Winnie Njeru. "Marketing Information Systems and Competitive Advantage at Consolidated Bank of Kenya Limited." European Journal of Business and Management Research 6, no. 5 (October 26, 2021): 224–27. http://dx.doi.org/10.24018/ejbmr.2021.6.5.1077.
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Business today is a challenge because of the dynamics involved, marketers whose responsibility is to ensure that the business makes profits also have to be dynamic on how they organize their marketing strategies in a way that is relevant to today’s market. Whatever the kind of establishment, market and purchaser information is necessary if organization objectives are to be met and consumers needs fulfilled, having an efficient marketing information system is one of the channels through which an organization can acquire the information it needs from its customers thereby giving the organization competitive advantage. This study therefore sought to establish the impact of marketing information systems on competitive advantage at Consolidated Bank of Kenya Limited. The study used a case study. Primary data was collected using an interview guide and data collected from the heads of departments particularly from marketing, alternative business channels and business development, who are highly involved in formulation and implementation of strategy. Content analysis was used to analyze the data. The study established that the marketing environment in the banking industry is very competitive and therefore marketers must adapt to the ever-changing marketing environment. Further, improvements in the bank’s products, services and the brand image have enhanced competitive advantage of the bank. Finally, the study also revealed that Marketing Information Systems are of value to the organization. In conclusion the study established that the company has in place a marketing information system which the bank uses to acquire relevant information from customers, which is in turn used to develop products and services that meet the customer’s needs while still maintaining lower costs. The study recommends that management should ensure continued improvement in the marketing information system to enable the bank to maintain sustainable competitive advantage. There need for management to set aside resources and invest in marketing information systems to enable the bank to compete effectively in its marketing environment.
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Ngigi Nyakarimi, Samuel, Samuel Nduati Kariuki, and Peter Wang’ombe Kariuki. "Moderating Effect of Government Regulations on Internal Control System and Fraud Prevention. A Case Banking Sector in Kenya." Journal of Social Sciences Research, no. 512 (December 25, 2019): 1900–1907. http://dx.doi.org/10.32861/jssr.512.1900.1907.
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The main purpose of the study was to establish the moderating effect of government regulations on the relationship between internal control system and fraud prevention in baking sector. Structured questionnaire was used as tool for data collection. The study was based on all banks registered and operating in Kenya and the questionnaires were meant for branch managers, operations mangers and cash managers in head offices of all banks. One hundred and seventeen questionnaires were distributed and officers from 33 banks out 39 banks returned fully filled questionnaires. The questionnaires were analyzed using Structural equation Model (SEM). The findings indicated that the government regulations have significant moderating effect of control environment and risk assessment. However, there was insignificant moderating effect on control activities, communication and monitoring of activities. The study suggested that further studies and analysis should be undertaken to establish those legislations and regulations that should be enhanced, abolished and also establish need of new laws to enhance the functions of internal control system.
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Njoroge, Leah, Mercy Warui, Catherine Mbogo, Margaret Chiera, and Dr Chogii. "THE DETERMINANTS OF INTEREST RATE SPREAD AMONG COMMERCIAL BANKS IN KENYA." International Journal of Finance and Accounting 2, no. 5 (August 29, 2017): 29. http://dx.doi.org/10.47604/ijfa.446.
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Purpose: To establish the determinants of interest rate spread among commercial banks in Kenya.
Methodology: The study utilized a descriptive survey research design.
Findings: The results indicated that the commercial banking sector has witnessed a gradual rise in the Interest rate spread. Results also showed that the mean of market structure has been fluctuating with year (2010) being the lowest with mean of 4 and year (2012) being the highest with mean 12. Results also showed that there was no regulation from the year (2005) to the year (2009) but it was later adopted whereas regulations shoot steadily to mean of 1.0 in the year (2009) and remained in the same level the rest of the years. The regression results indicate that there is a positive and significant relationship between market structure, credit risk and interest spread. The regression results also indicated that there is a positive but insignificant relationship between access to information and interest spread. Further, the results indicated that there is a negative and significant relationship between regulation and interest spread.
Unique contribution to theory, practice and policy: The study is important to the management of Commercial banks as it will provide an insight on the factors influencing interest rate spread among commercial banks in Kenya. The results of this study will provide information to policy makers and other stakeholders in the financial sector (especially the banks) to come up with strategies that help in dealing with the high interest rate spread experience in the banking sector and thus improve on the financial performance of the organisations. It may be used as a tool for persuading commercial banks to reduce their interest rates spread and hence increase their volume of business, which of course would compensate the loss in the interest rate spread. The study will also be invaluable to the government and CBK. This is because the monetary policy framework of Central Bank of Kenya and its implementation will be guided by a need to ensure, among others: realistic interest rate spreads that encourage financial deepening and a safe, sound, efficient and competitive banking system through discreet risk management. These findings therefore might influence the effectiveness of economic policies. The research results will also be important to scholars and researchers as it will add to the existing pool of knowledge.
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Mtengwa, Bonnie Batsirai, Agripah Kandiero, and Stanislas Bigirimana. "Drivers of Mobile Money Services Development in Zimbabwe." International Journal of E-Business Research 17, no. 1 (January 2021): 42–64. http://dx.doi.org/10.4018/ijebr.2021010104.
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This study sought to identify the drivers of mobile money services development in Zimbabwe using Ecocash as a case study. Through purposive sampling, respondents were selected from financial institutions, regulatory bodies, customers, and agents. The research showed that in Zimbabwe the development of mobile money services is influenced by several factors such as a high mobile telephone penetration rate, a high number of unbanked people owing to poor access to traditional banking services, a lower level of internet penetration levels, customer awareness of the service because of aggressive branding, security and ease of use, and a dense networks of agents. Fast technology diffusion was also a factor that influenced the fast adoption of mobile money services in Zimbabwe. More research is needed to assess the impediments in countries where the adoption of mobile money services has not been as spectacular as in Zimbabwe or Kenya.
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Davis Bundi, Ntwiga,, and Weke Patrick. "Credit Scoring for M-Shwari using Hidden Markov Model." European Scientific Journal, ESJ 12, no. 15 (May 30, 2016): 176. http://dx.doi.org/10.19044/esj.2016.v12n15p176.
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The introduction of mobile based Micro-credit facility, M-Shwari, has heightened the need to develop a proper decision support system to classify the customers based on their credit scores. This arises due to lack of proper information on the poor and unbanked as they are locked out of the formal banking sector. A classification technique, the hidden Markov model, is used. The poor customers’ scanty deposits and withdrawal dynamics in the M-Shwari account estimate the credit risk factors that are used in training and learning the hidden Markov model. The data is generated through simulation and customers categorized in terms of their credit scores and credit quality levels. The model classifies over 80 percent of the customers as having average and good credit quality level. This approach offers a simple and novice method to cater for the unbanked and poor with minimal or no financial history thus increasing financial inclusion in Kenya.
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Bwire, Albert Camus Onyango. "Loan asset indicators and commercial bank fragility in Kenya." European Journal of Management Issues 29, no. 1 (March 25, 2021): 25–36. http://dx.doi.org/10.15421/192103.
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Purpose. To test the predictive ability of loan asset indicators on Commercial bank fragility in Kenya.
Design/Method/Research approach. The study adopted positivism research philosophy with exploratory research design. The study population was 42 Commercial banks in operation on 31st December 2015. Secondary data was collected from Central Bank of Kenya and analysed using Stata Statistics/Data analysis. Generalised Linear Model was used to establish the relationship between asset indicators and bank fragility. The concept of credit creation was explored as the genesis of bank fragility. This study is part of early warning systems in detecting bank fragility.
Findings. The research found a direct relationship between a lagged dependent variable, loan portfolio growth, loan deposit ratio and bank fragility.
Practical implications. Recommendations are followed on the basis of this study. At first, regulator develop a potential solution to control loan portfolio growth, cap loan deposit ratio and limit the level of non-performing loans. Banking practitioners should model monthly reporting requirements to ensure that banks are able to disclose the ratio and explain any significant changes. Secondly, since Non-performing loans can act as an incentive for bank managers to seek deposits and lend more thereby exacerbating the problem, banks with NPL to gross loans greater than an upper threshold determined by the regulator should not be allowed to attract more deposits. Thirdly, set the maximum level of loan deposit ratio to avoid expensive, sensitive and high-risk loan capital. Implementation of these recommendations will lead to secured social welfare.
Originality/Value. The study examines the role of certain loan asset indicators on bank fragility and extends the discussion in the area of early warning systems and commercial bank instability in Kenya.
Research limitations/Future Research. This research contributes to the discussion on bank fragility and early warning systems. The further research should review evidence from other jurisdiction with high numbers of distressed institutions to determine how many months or years before distress the three significant variables could predict fragility. Besides, there is need for research on insider loans as defined and why there was no statistical significance.
Paper type. Empirical.
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Nchor, Dennis, and Václav Adamec. "Unofficial Economy Estimation by the MIMIC Model: the Case of Kenya, Namibia, Ghana and Nigeria." Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis 63, no. 6 (2015): 2043–49. http://dx.doi.org/10.11118/actaun201563062043.
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This study investigates the size and trend of the underground economies in selected African countries. Underground economies are present in all countries, but they are endemic in developing economies. Their presence is not necessarily bad for the economies, in which they prevail. It could however cause huge losses to government revenue and could also constitute serious violation of Labor regulations. The study uses the Multiple Indicators and Multiple Causes model (MIMIC), a variant of Simultaneous Equations Model (SEM). It involves two sets of variables: the observed variables and the indicator variables. The former include size of government, indirect tax rates, total tax rates, business regulation, interest rate on deposits, unemployment rate, quality of public services, and GDP per capita. The indicator variables were Labor participation rate in the official economy, the amount of cash held outside the banking system and growth in GDP per capita. This study found the average level of underground economies in Kenya, Namibia, Ghana and Nigeria as 33.7%, 29.1%, 36% and 47%, respectively. The estimated results show that the causes of shadow economic activities vary among the countries. The data was obtained from the World Bank country indicators and the International Financial Statistics.
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Sarpong-Kumankoma, Emmanuel, Joshua Abor, Anthony Q. Q. Aboagye, and Mohammed Amidu. "Differences in bank profit persistence in Sub-Saharan Africa." African Journal of Economic and Management Studies 9, no. 4 (December 3, 2018): 512–22. http://dx.doi.org/10.1108/ajems-03-2017-0037.
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Purpose The purpose of this paper is to examine differences in determinants of bank profit persistence among Sub-Saharan African (SSA) countries. Design/methodology/approach Using system generalized method of moments and data from four SSA countries during the period 2006–2012, this study considers differences in determinants of bank profit persistence across countries. Findings Efficiency in cost management is a major determinant of profit persistence in all the countries. However, concentration is found to be insignificant in all the estimations, suggesting that efficiency may be a more important determinant of profit persistence than concentration. Economic freedom associates negatively with profit persistence in Ghana, but its effect is insignificant in Tanzania, Kenya and South Africa. Lending specialization translates into less profit persistence in South Africa, but greater persistence in Tanzania. Higher levels of financial development result in lower profit persistence in Kenya and Ghana, but does not matter in Tanzania and South Africa. Practical implications The level of profit persistence gives an indication of the effectiveness of competition policies, and the differences observed in their determinants in this study suggest the need for tailor-made policy responses in the different countries. Originality/value This study improves the understanding of why some banking market competition policies have not achieved the desired outcomes in some countries. It is evident that blanket rules or wholesale importation of policies from other countries may not work in different contexts.
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Siregar, Hajizah Azmi, Noya Yukari Siregar, and Yeni Selfia. "Sosialisasi Sampah Melalui Bank Sampah untuk Menyejahterakan Masyarakat di Desa Truko Jawa Tengah." JATI EMAS (Jurnal Aplikasi Teknik dan Pengabdian Masyarakat) 5, no. 1 (April 5, 2021): 5. http://dx.doi.org/10.36339/je.v5i1.406.
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Indonesia is the second largest contributor to plastic waste after China. In this case, the Kendal Regency government has various ways to educate the community to be aware of the importance of waste management. One way to reduce the amount of waste is by establishing Garbage Bank. Truko Village is one of the villages in Kendal district, Central Java province, this village was selected for community service activities because Truko village does not yet have a Garbage Bankand the village community also does not understand the system of running a Garbage Bank. This happens because there is still a lack of information about the Garbage Bank and proper waste management. To achieve this goal, the methods used are:1) Educating the public about the Garbage Bank program 2) Socializing the management of Garbage Bank and waste 3) Socialization and training on waste management has become a valuable project. The existence of this article is expected to improve facilities in Truko village and in other villages with a plan to form a Waste Bank.Establishing a Garbage Bank is a way to improve village facilities because with a Garbage Bank the waste management process will be more focused, it is hoped that this article can provide information to people in Truko Village and people outside Truko Village the process of forming a Garbage Bank and managing waste appropriately to become valuable goods selling
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Osifo, Osagie, and Esther Ikavbho Evbayiro-Osagie. "FOREIGN DIVERSIFICATION AND PERFORMANCE OF QUOTED DEPOSIT MONEY BANKS IN SELECTED SUB-SAHARA AFRICAN COUNTRIES." Oradea Journal of Business and Economics 5, Special (June 2020): 82–93. http://dx.doi.org/10.47535/1991ojbe099.
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Foreign diversification offers prospective market opportunities which afford firms prospects for greater growth and penetration of global markets. This study investigated the effect of foreign diversification on performance of quoted deposit money banks in selected Sub-Sahara African countries; Botswana, Ghana, Kenya, Malawi, Mauritius, Namibia, Nigeria, South Africa, Uganda, Zimbabwe and Zambia. The study employs secondary data collected and computed from sampled deposit money banks annual audited financial statements. Employing the use of descriptive statistics, correlation analysis, panel unit root analysis, co-integration test, multivariate panel data analysis and the system- GMM for a period of 2007 – 2017, the data were estimated with the aid of Eviews 9.0 econometric statistical package. Using dependent variables (Net interest margin and Tobin Q), explanatory variables of foreign diversification, bank’s size and bank’s age respectively. The findings revealed that foreign diversifications have negative and significant effect on all the performance indicators (NIM and TOBIN Q) used in the study. The explanatory variable (foreign diversification) was significant at 1% significance level. The findings from robustness check showed that the coefficients of foreign diversification are also largely negative for most of the banks. This study therefore recommends, amongst others, banks should consider diversification as a long run strategy for promoting growth and other forms of expansions. This can be achieved by promoting more regional banking integration within the sub-region. Given that formalities are already on the ground to facilitate entry and establishment within economies in the regional blocs, diversification in this direction will involve less institutional obstacles
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Kanake, Martin Guantai, and Dr R. Mahesh. "THE IMPACT ASSESMENT OF THE MICRO FINANCE TO FINANCIAL INCLUSION AND BISUNESS GROWTH: A STUDY OF THE MICRO, SMALL AND MEDIUM ENTERPRISES IN IGEMBE SOUTH (KENYA)." American Journal of Finance 3, no. 1 (April 20, 2018): 1. http://dx.doi.org/10.47672/ajf.323.
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Purpose: The purpose of this study was to assess the impact of microfinance on financial inclusion and business growth in Igembe South District Kenya.Methodology: Descriptive research was used in discovering the research objectives. The research targeted the micro, small and medium sized businesses operating in Maua town (Igembe south District), 2181 of which were registered and licensed. A sample of 280 businesses (12.84% of the population) participated in the study.Results: This study revealed that microfinance institutions played a major role in improving financial inclusion among the small business owners who previous research has shown that they have been traditionally excluded from the formal banking systems. 78% of the respondents had access to the micro finance services while 60% had active microcredit in the preceding 12 months. It was clear that the microfinance institutions were cultivating the culture of saving among the micro entrepreneurs. However, most of the new businesses specifically those less than one year of age minimally benefitted from the micro finance services. It was also noted that default risk among the small businesses remains to be a challenge that micro credit lenders have to overcome for continued services provision. Working capital requirement was the leading reason for borrowing from micro finance institutions by the businesses.Unique contribution to theory, practice and policy: The study found that there was a good complementation between the existing micro finance institutions and the public entrepreneurial programs initiated by the government of Kenya such as Youth Entrepreneurs Development Fund, Women Enterprise Fund, Uwezo Fund and other County governments initiatives. The study recommended that the microfinance institutions should also be included in the distribution channel of these public funds for stronger linkage with the target groups. The MFIs should also utilize Credit Reference Bureau services to reduce the problem of default.
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Ramos, Patrick Kioko. "The Influence of Digital Money on Economic Growth in Kenya." Account and Financial Management Journal 06, no. 11 (November 1, 2021). http://dx.doi.org/10.47191/afmj/v6i11.01.
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The growth of the economy is a concern to many because it has an influence on the progress of a country and its citizens. It is expected that an economy with a highly advanced digital money system should also experience high economic growth. However, statistics indicate that the economic growth rate in Kenya has been fluctuating and has failed to grow consistently despite numerous policy interventions. This study sought to establish the influence of digital money on Economic Growth in Kenya. The study incorporated a descriptive research technique and a time series approach to analyse the relationship between digital money and economic growth using Kenyan quarterly data from 2011 to 2020. Four variables were used as proxies to measure digital money: - the value of mobile money transactions, the value of cards money transactions, the value of internet banking (EFTs) transactions and agency banking. The findings revealed that all relationships that were tested were positive and significant each with p-Value that was less than 0.05. Further analysis showed F-Calculated (1, 38; α=0.05) was 32.909 (card transactions), 247.029 (EFT transactions), 297.118 (mobile transfer), and 571.417 (active agents). Therefore, the study recommended that there is need for an intensified campaign to sensitize the public on the importance of digital money owing to their flexibility and improved security as compared to carrying physical cash especially in the wake of the COVID-19 pandemic. To the policy makers, the findings suggest that there is need to solidify and enforce strong digital/ICT policy that promotes cashless payments.
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Kung’u, Gabriel Kamau, and Athanas Osiemo Kengere. "Deposit Insurance a Precursor of Bank System Stability? An Empirical Evidence of Kenya Banking System." International Journal of Business & Management 9, no. 9 (September 30, 2021). http://dx.doi.org/10.24940/theijbm/2021/v9/i9/bm2109-045.
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Ambira, Cleophas, and Henry Kemoni. "Records management and risk management at Kenya Commercial Bank Limited, Nairobi." SA Journal of Information Management 13, no. 1 (October 6, 2011). http://dx.doi.org/10.4102/sajim.v13i1.475.
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Background: This paper reported empirical research findings of an MPhil in Information Sciences (Records and Archives Management) study conducted at Moi University in Eldoret, Kenya between September 2007 and July 2009.Objectives: The aim of the study was to investigate records management and risk management at Kenya Commercial Bank (KCB) Ltd, in the Nairobi area and propose recommendations to enhance the functions of records and risk management at KCB. The specific objectives of the study were to, (1) establish the nature and type of risks to which KCB is exposed, (2) conduct business process analysis and identify the records generated by KCB, (3) establish the extent to which records management is emphasised within KCB as a tool to managing risk, (4) identify which vital records of KCB need protection because of their nature and value to the bank and (5) make recommendations to enhance current records management practices to support the function of risk management in KCB.Method: The study was qualitative. Data were collected through face-to-face interviews. The theoretical framework of the study involved triangulation of the records continuum model by Frank Upward (1980) and the integrated risk management model by the Government of Canada (2000).Results: The key findings of the study were, (1) KCB is exposed to a wide range of risks by virtue of its business, (2) KCB generates a lot of records in the course of its business activities and (3) there are inadequate records management practices and systems, the lack of which undermines the risk management function.Conclusion: The findings of this study have revealed the need to strengthen records management as a critical success factor in risk mitigation within KCB and, by extension, the Kenyan banking industry. A records management model was proposed to guide the management of records within an enterprise-wide risk management framework in the bank.
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Kimani, Edwin Njoroge. "Interest Rate Caps in Kenya; Is this the End of the Oligopolistic Banking System?" SSRN Electronic Journal, 2016. http://dx.doi.org/10.2139/ssrn.2919355.
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Muthinja, Moses M., and Chimwemwe Chipeta. "Financial innovation, firm performance and the speeds of adjustment: New evidence from Kenya’s banking sector." Journal of Economic and Financial Sciences 11, no. 1 (June 28, 2018). http://dx.doi.org/10.4102/jef.v11i1.158.
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This article examines the speed of adjustment of firm performance to financial innovations usage and the speed of adjustment of financial innovation to financial innovation drivers for banks in Kenya. We used the Koyck distributed lag model, which is estimated using dynamic panel estimation with System Generalised Method of Moments. We find that it takes on average 1.179 years for bank financial performance to adjust to the four financial innovations studied. Secondly, it takes less than a year (0.368 years) to accomplish 50% of the total change in firm performance following a unit-sustained change in the financial innovations. Moreover, mobile banking has the shortest mean lag (2.849), while Automated Teller Machines (ATMs) have the longest mean lag (4.926). Notably, it takes approximately three years for mobile banking to adjust to financial innovation drivers at firm level and on average five years for ATMs to adjust to the financial innovation drivers.
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Atellu, Antony Rahim, Peter Muriu, and Odhiambo Sule. "Do bank regulations matter for financial stability? Evidence from a developing economy." Journal of Financial Regulation and Compliance ahead-of-print, ahead-of-print (August 3, 2021). http://dx.doi.org/10.1108/jfrc-12-2020-0114.
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Purpose This paper aims to establish the effect of bank regulations on financial stability in Kenya. Specifically, the study seeks to uncover the effect of micro and macro prudential regulations on financial stability and their trade-offs or complementarities. Design/methodology/approach Using annual time series data over the period 1990–2017, the study uses structural equation model (SEM) estimation technique. This solves the problem of approximating measurement errors, using both latent constructs and indicator constructs. Findings Study findings reveal that macro and micro prudential regulations are significant drivers of financial stability. Further, prudential regulations are more effective when they complement each other. Research limitations/implications This study centers on how bank regulations affect financial stability. Future research could be carried out on the effect of Non-Bank Financial Institutions regulations on financial system stability. Practical implications Complementing macro and micro prudential regulation is more effective and efficient in ensuring stability of the financial system other than letting the two policy objectives operate independently. Social implications Regulatory authorities should introduce prudential regulations that would encourage innovations in the banking sector. This ensures easy deposit mobilization that enhances financial inclusion. Prudential regulations that ensure financial stability will be effective when low income earners are included in the financial system. Originality/value To the best of the authors’ knowledge, this study is the first to investigate the role of banking regulations on financial stability. This study is also pioneering in the use of SEM estimation technique, in examining how prudential regulations affect financial stability. Previous cross-country studies have focused on macro prudential regulations ignoring the importance of micro prudential regulations.
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Karoney, Kenneth Kibet, Mathew K. Kosgei, and Kennedy L. Nyongesa. "Modelling the Mean Waiting Times for Queues in Selected Banks in Eldoret Town-Kenya." Asian Journal of Probability and Statistics, July 25, 2019, 1–9. http://dx.doi.org/10.9734/ajpas/2019/v4i330116.
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The mathematical study of waiting lines is mainly concerned with queue performance measures where several applications have been drawn in past studies. Among the vast uses and applications of the theory of queuing system in banking halls, is the main focus of this study where the theory has been used to solve the problem of long queues as witnessed in banks leads to resource waste. The study aims to model the waiting times for queues in selected banks within Eldoret town, Kenya. The latter component was put under D/D/1 framework and therein its mean derived while the stochastic component was put under the M/M/c framework. Harmonization of the moments of the deterministic and the stochastic components was done to come up with the mean of the overall bank queue traffic delay. The simulation was performed using MATLAB for traffic intensities ranging from 0.1 to 1.9. The results reveal that both deterministic and the stochastic delay components are compatible in modelling waiting time. The models also are applicable to real-time bank queue data whereupon simulation, both models depict fairly equal waiting times for server utilisation factors below 1 and an infinitely increasing delay at rho greater than 1. In conclusion, the models that estimate waiting time were developed and applied on real bank queue data. The models need to be implemented by the banks in their systems so that customers are in a position to know the expected waiting time to be served as soon as they get the ticket from the ticket dispenser.
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Koskei, Loice. "Unsystematic Risk Factors and Mortgage Non- Performing Loans in Kenya: Evidence from Commercial Banks." Asian Journal of Economics, Business and Accounting, October 26, 2020, 22–31. http://dx.doi.org/10.9734/ajeba/2020/v18i330285.
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Commercial banks face severe challenges relating to their processes due to variations in the financial system. Identifying methods for reducing mortgage defaults and reducing the level of nonperforming loans is very important. Mortgage defaults occur because of complex factors. The amounts of mortgage non-performing loans depend on unsystematic risk factors which have an effect on mortgage loans of commercial banks. The stronger the effect of such factors, the less useful is diversification across a large number of borrowers and the stronger are the fluctuations in portfolio losses over time. The study looked at unsystematic factors and mortgage non-performing loans in Kenya’s commercial banks. Annual panel secondary data spanning from 2014 to 2019 was obtained from the Central bank of Kenya, Banking Supervision report and Kenya National Bureau of Statistics. The six year period was chosen because of availability of Mortgage secondary data. A panel fixed effects regression model was employed to address the objective of this study. The fixed effects panel regression model results indicated that capital asset ratio and lending rate had negative and statistically insignificant effect on Mortgage non-performing. Loans to deposit ratio and bank size results indicated a positive and statistically significant effect on mortgage non-performing loans implying that loans to deposit ratio and bank size affects mortgage non-performing loans in Kenya’s commercial banks. ROA results indicated a negative but statistically significant effect on mortgage non-performing loans. The study recommended enactment of internal policies by banks in regard to unsystematic factors in order to minimize the surge in mortgage non-performing loans especially in Kenya.
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Smith, Ryan, and Laura Ruhl. "Chamas for Change: A Community Based Strategy for Pregnancy, Infancy, and Women Empowerment." Proceedings of IMPRS 1, no. 1 (December 7, 2018). http://dx.doi.org/10.18060/22791.
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Background: Maternal mortality is the leading cause of death among women of childbearing age in Kenya, and 1 in every 19 infants dies before their first birthday. To address this, Chama cha MamaToto was developed as a community-based program for pregnant and breast-feeding women. It integrates health and social education to decrease poor health outcomes and parental stress. It also uses a table banking system called GISHE to develop financial independence. Central to Chamas is peer support and accountability, leading to empowerment of the women. This poster is an analysis of the program’s history, and a summary of data collected by the MNCH team from MTRH.
Results: Women in Chamas had 5 times the odds of delivering in a health facility (OR = 5.07, 95% CI: 2.74-9.39). Children in Chamas had 33% relative reduction in stunting. Women and children in Chamas experienced 30% absolute reduction in harsh punishment (p< 0.001) compared to the control group. The Chamas program showed the potential for combined relative reduction of stillbirths and infant deaths by 56 percent (p<0.083). Additionally, women in Chamas had an 35% absolute increase in EBF for 6 months.
Personal role: My role working with the Chamas program this summer involved a cost analysis of the program as well as developing an implementation manual.
Conclusion: The next steps for the program include a continued scale up in two new sub counties, validation of findings from a cluster RCT, and a scale up of the program to all of Kenya in 2019.