Towards the Development of a Framework for improving Internet banking in Kenya
Abstract
Internet banking IS a primarily a recent technology that enables customers access banking
services and transact remotely through the Internet (WWW) using computers or other hand-held
devices. The concept has gained popularity in developed countries and to a lesser extent in
developing countries. Internet banking has the potential of time and cost savings to banks and
customers hence our interest in the subject.
The ultimate goal of our study was to develop a framework for improving Internet banking
business in Kenya. Towards achieving this goal, the research set to examine the value of Internet
banking in bank-customer relationship as well as appreciate the issues customers faced in their
use of the service. Using these key customer issues, suitable technology considerations were
proposed to mitigate.for increased customer satisfaction. The research therefore took a customer facing
approach in proposing the framework. Literature review identified key models notably
UTAUT, forces responsible for increasing and competitive change in the banking industry and
Internet portal quality that formed the basis of our proposed framework. A survey was planned
involving commercial banks and their customers. Data was collected using questionnaires
followed by interviews for additional information. 1,0l3 questionnaires were distributed of
which 615 useful responses received (60.7% response rate). The data was analyzed using
frequency, percentage, means as well as regression and correlation analysis.
Analysis of the results established that 70% of banks that participated confirmed that Internet
banking was of strategic value in their bank-customer relationship and 12 of them were actually
offering the service. Furthermore, only 28% of the identified Internet banking products had been
implemented. Customers used Internet banking more for obtaining financial information and less
for transactional needs. Favourable economic climate and increasing customer demands for
better, cheaper and convenient services served to push banks towards rolling out Internet
banking. Support for Internet banking transactions was the biggest challenge consumers of the
service faced followed by slow systems and issues of security and trust. A generic framework for
improving Internet banking was eventually proposed based on identified technology
considerations to address these service gaps.
Citation
Master of Science in Information SystemsSponsorhip
University of NairobiPublisher
University of Nairobi School of Computing and Informatics