Factors Influencing the Application of Technology to Enhance Efficiency of International Banks in Kenya
Abstract
The main purpose of this study was to determine factors influencing the application of
technology to enhance efficiency of international banks in
Kenya.
The study arose
because of the
fast-changing competitive environment, globalization, economic changes,
regulation, privatization and the like demands that banks are run efficiently and
effectively by continuously engaging in technological
innovations. There
is a wave of
rapidly evolving
technology. Technology
is changing the face of banking
completely. A
rapidly
evolving
business environment
is
causing the global banking industry to rethink
the way it leverages
technology. Market
growth objectives, the desire to create a globally
integrated multichannel
environment, and managing the complexity of new products are
placing increasing pressure on global banking institutions to move toward a bank of the
future paradigm. The transition
to
this future
state requires banks to realign their
technology environment and, more importantly, their IT applications
portfolio. There
is
increasing focus on customer centricity. While
banks push hard for cashless,
branchless
future, ultimately it is the consumers who accept or reject the techno heavy banking
systems. Banks
face serious future strategy challenge. The basic structure of the bank is
increasingly in conflict with the changing product delivery, and service needs o
f the
customers. The future belongs to the financial e service providers and not traditional
banks.
Banks will have to first develop a comprehensive distribution system
that will
enable customers to touch them at multiple
points. Banks
must also create performance
measurements
systems to ensure the mix of products and services they offer are
beneficial to both
the customer
and the bank. They must determine whether to deploy
new technologies themselves or with other service
providers. Nevertheless, technology
will not solve issues or
create
advantages. This technology needs to be integrated in an
organization, with the change management issues linked to people resisting new concept and ideas. Banks will also need to support a clearly defined and well communicated
business strategy.
Into the future banks
technology budgets are expected to continue
increasing as newer technologies occupy banking space. But with an economic on
recovery, and with regulatory scrutiny more intense than ever, banks IT investments are
likely to be focused largely on driving efficiencies and complying with new
requirements.
IT innovation in banking sector has failed to focus much attention on the
impact of these technological innovations to enhancing efficiency of international banks
in
Kenya.
This study adopted survey
research design and targeted 13 international banks
in Kenya.
Both secondary and primary
data was used.
A statistical package for social
sciences (SPSS Version 20.0) was
used.
From the findings of the study
it
was
concluded
that electronic
fund transfer, the card system and ATM availability influence technology
application in international banks and banking in general which has set the stage for
exceptional increase in financial activity across the globe.
Thus the study
findings
recommended
that
international banks should ensure free flow of information and
adequate use of technology in decision making in strategic and tactical
planning.
International banks should think of creative approaches to ensure that the
respectful
department has more time to experiment with integrating technology on service delivery
and
focus on using technology to enhance efficiency rather than the acquisition of
infrastructure.
This will help to create value networks and counter the challenges
Publisher
University of Nairobi