Impact of Mobile Banking on Financial Inclusion in Kenya

Abstract

The objective of the study was to examine the impact of mobile banking on financial inclusion in Kenya.The study population was all the 8 banks in Kenya with mobile banking.The study used secondary data from audited statements from communications authority of Kenya, central bank of Kenya and Kenya national bureau of statistics of all the 8 banks in Kenya with mobile banking.The researcher used both descriptive and inferential statistics in the studywhich included Pearson correlation and regression coefficient.Findings from regression results showed that the number of users enrolled mobile money services had a positive and significant effect with financial inclusion.The results also revealed that number of mobile money agency distribution had a positive and significant effect with financial inclusion. The results also showed that number of mobile banking transactions performed using mobile phones had a positive and significant effect with financial inclusion. In addition the results depicted that log of value of mobile banking transactions had a positive and significant effect with financial inclusion. Further the results revealed that technology had a positive and significant effect with financial inclusion. The study concluded thatthe number of users enrolled to mobile money services,number of mobile money agency distribution,and number of mobile banking transactions performed using mobile phones, log of value of mobile banking transactions and technology had a positive and significant effect on financial inclusion.The study recommends that to enable lower fees, category of street-level sub-agents, characterized by lower costs and commissions than store-based agents should be created.Sub-agents would use normal retail outlets to rebalance their cash and stored value.