Retail Technology and Operational Performance of Commercial Banks in Kenya

Abstract

The aim of the study was to establish if the use of retail technology in commercial banks in Kenya had an impact on the bank’s operational performance. The specific objectives were to determine the retail technology commonly used in the commercial banks in Kenya, and determine if there was a relationship between retail technology use and operational performance in commercial banks in Kenya. This study used a descriptive design. Descriptive research design is a scientific method that involves the observation and description of a subjects behavior without imputing any form of influence to it. The population of interest to the study was all commercial banks operating in Kenya. There are currently 42 commercial banks operating in Kenya. Data was collected from all the banks in Kenya, the study being a census survey. The census method was thus used. Primary data collection was done through the administration of a semi-structured questionnaire to the operations manager of each bank. The use of a questionnaire ensured collection of data within a short time. The data was processed through coding then descriptive analysis of the codes done. Quantitative data was processed by tabulation and the descriptive analysis done. Multiple regression analysis was used. The study found that retail technology was applied in the banks. The study also established that the bank uses mobile banking as the retail technology in its operation. The study further established that the bank uses mobile banking to a great extent as compared to other retail banking practices. The study established that to a great extent that a customer friendly environment while waiting for service, such as music and running advertisements of other available products while waiting for service, was very good at the banks. It also established that retail technology influences the operational performance of commercial banks to a great extent. At a 5% level of significance and 95% level of confidence Internet Banking, Mobile Banking, Electronic Payments, Information Exchange, and ATM Banking were all significant retail technology practices to increased operational performance of commercial banks in Kenya. This study concluded that to a great extent that all the customers’ transactions were processed efficiently without waiting. This was the practice that had been applied in the retail technologies to a great extent. The study also concluded that to a great extent that all the transactions are processed efficiently without waiting is an important retail technology practice in the commercial banks. The study recommended that Commercial banks adopt more retail technology practices that were not specifically mentioned in this study alongside the use of the current ones discussed for the results suggests that the influence performance to a great extent.