The effect of M-Pesa technology strategy on the performance of Kenya Commercial Bank ltd
The spread of mobile phones across the developing world is one of the most remarkable technology stories of the past decade. Buoyed by prepay cards and inexpensive handsets, hundreds of millions of first-time telephone owners have made voice calls and text messages part of their daily lives. However, many of these same new mobile users live in informal and/or cash economies, without access to financial services that others take for granted. Indeed, across the developing world, there are probably more people with mobile handsets than with bank accounts. Various initiatives have been used mobile phones to provide financial services to “the unbanked.” These services take a variety of forms—including long-distance remittances, micropayments, and informal airtime bartering schemes—and go by various names, including mobile banking, mobile transfers, and mobile payments. Taken together, they are no longer merely pilots; in the Philippines, South Africa, Kenya, and elsewhere, these services are broadly available and increasingly popular. Kenya commercial bank ltd is a leading and dominant Kenyan bank with a strong countrywide presence. The bank remains very strong in key parameters with the largest balance sheet (KShs 251.4billion), capital base (Kshs 39.1billion) and a branch network (218) as at 2010. To better its way of doing business and align to current practices including the statutory requirements, the bank’s structures, processes and systems have continued to change. This research was conducted to establish the effect of the M-pesa technology strategy on the performance of KCB ltd. The researcher used case study design since the research is descriptive in nature. Both the primary and secondary sources of data were used to obtain information for the study. Respondents were three employees in the Money Transfer Services department in Kenya Commercial Bank Ltd. The interview guides were administered through a face to face interview. The researcher used Content Analysis to analyze the data, because content analysis involves observation and detailed description of objects, or things, and the errors which occur during the study are easily detected and corrected. The introduction of the topic is covered in Chapter one, literature review in chapter two covers the theoretical and empirical materials, chapter three covers the methodology used, while chapter four and five are the research findings and summary of the findings respectively.The research findings show that Kenya commercial bank took a beneficial strategic step to keep up with the dynamic market. What drives a business growth is technological innovation and successful management lies in skilful allocation of resources to bring about the technological change. There has been increasing importance of technological innovation and strategy guiding the acquisition and deployment of technological resources for competitive growth. The bank industry has come up with technological strategy to keep up with the expectations of the customers. However there are various challenges which are associated with M-pesa technology strategy, these being the system being prone to fraudsters, systems upgrades which leaves the customers disappointed and difficulties in reconciliations of the accounts when the transactions are many or when there are system errors.