dc.contributor.author | Munyasya, Catherine Kavinya | |
dc.date.accessioned | 2013-11-15T12:37:50Z | |
dc.date.available | 2013-11-15T12:37:50Z | |
dc.date.issued | 2013-11 | |
dc.identifier.citation | Degree of Masters of Business Administration | en |
dc.identifier.uri | http://erepository.uonbi.ac.ke:8080/xmlui/handle/123456789/59176 | |
dc.description | A research project submitted in partial fulfillment of the
requirements for the award of the degree of master of business
administration, university of Nairobi | en |
dc.description.abstract | Banking sector plays a major role in mobilizing and allocating resources to various sectors in an
economy. However, the sector is faced with a number of challenges among them macroeconomic
shocks. Thus to maximize profits and smoother macroeconomic shocks, commercial banks
adopt or create various financial innovations such as internet banking in order to increase
consumer demand through improved product or service quality, while simultaneously bringing
down the cost of production. In Kenya, little is known on the effects of macroeconomic factors
on internet banking. Therefore, the objective of this study is to analyze the effects of
macroeconomic factors on internet banking in Kenya. Specifically we sought to investigate the
effects of macroeconomic and bank specific factors on internet banking in Kenya. The analysis
focused on 33 commercial banks for a period between 2002 and 2012. To achieve the objectives
of this study we employed linear regression analysis to estimate the effects of both
macroeconomic and bank specific factors on internet banking in Kenya. We used random effects
model since we had a panel data. The study found that macroeconomic factors such as inflation
rate and economic growth bank specific factors such as asset base of the bank determines
internet banking. However, interest rate, nonperforming loans and bank profit do not determine
internet banking. Inflation rate and economic growth were found to negatively affect internet
banking. On the other hand asset base of the bank was found to positively influence internet
banking. The study concluded that macroeconomic factors have effect on internet banking in
Kenya. Specifically, inflation rate and economic growth are key macroeconomic determinants of
internet banking in Kenya. The study recommended that central bank should focus on enhancing
macroeconomic stability by maintaining low inflation rate. Further, the government should
devise policies that aim at increasing economic growth at the same time sensitizing people on the
need to adopt internet banking. Commercial banks should ensure compliance on all borrowing
requirements in order to avoid bad debts in order to increase their profitability and accumulating
more assets. Accumulation of asset would provide a strong muscle for the commercial banks to
invest in internet banking platforms. | en |
dc.language.iso | en | en |
dc.publisher | University of Nairobi | en |
dc.title | Effect of macroeconomic factors on internet banking by commercial banks in Kenya | en |
dc.type | Thesis | en |
local.publisher | School of Business | en |